Las Vegas Sun

March 29, 2024

Boyd’s bad news, good news

The slowdown in the locals casino market apparently hasn't hurt No. 2 operator Boyd Gaming Corp. much.

The question that even top executives can't yet answer is how long this slowdown will last.

Fourth quarter revenue from the company's locals casinos in Las Vegas fell 2 percent but operating profit rose 3 percent, as the company implemented efficiency initiatives last year.

Executives warned that they wouldn't be able to sustain such efficiency gains in the future. Meanwhile, the housing market is still in the tank and competitor Station Casinos hasn't let up on its aggressive promotions since going private.

But analysts say there are bright spots on the horizon for Boyd, including the company's new, tiered player rewards program aimed at encouraging locals to gamble at Boyd-owned properties around the country.

Business is expected to pick up "as construction workers flood to town" to build Strip resorts expected to open in coming years and as workers are recruited to work at the hotels, opening in 2009 and 2010, Jefferies & Co. stock analyst Larry Klatzkin said in a research note.

The company blamed overall lower revenue and profit in the fourth quarter on its Blue Chip casino in northwest Indiana, which has new competition and is under construction with an expansion.

While the Atlantic City market reported an overall decline in 2007, the company's luxury Borgata casino grew gaming revenue by 3.7 percent and stole market share from the competition in 2007. The Borgata's Water Club hotel addition opens in June.

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