PCI Gaming Authority

Overview Key strengths Key risks Strong market position in the Alabama gaming market. Macroeconomic headwinds could lower gaming demand. Relatively low leverage and strong EBITDA margins compared with regional gaming peers. New development in the competitive Chicago market could increase marketing spend and reduce profitability. Strong cash flow conversion due to low taxes and interest expense. Under our forecast, we expect PCI's S&P Global Ratings-adjusted net leverage to increase somewhat to the mid- to high-1x area in fiscal year 2023 (ending Sept. 30), mostly due to net debt increasing because of capital spending at its Chicago casino project from the mid-1x area in fiscal year 2022. Our forecast also reflects our view that the demand for its casino properties will

...PCI Gaming Authority (PCI) has built a significant cushion into its credit measures and we believe it has sufficient capacity to absorb development spending and some operating volatility next year. Under our forecast, we expect PCI's S&P Global Ratings- adjusted net leverage to increase somewhat to the mid- to high-1x area in fiscal year 2023 (ending Sept. 30), mostly due to net debt increasing because of capital spending at its Chicago casino project from the mid-1x area in fiscal year 2022. Our forecast also reflects our view that the demand for its casino properties will begin to decrease significantly in fiscal year 2023, compared with low-...

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