Boyd Gaming losses narrowing

Wednesday, May 6, 2009 | 8:02 a.m.

Boyd Gaming Financial Information

	2Q 2009	2Q 2008	% Change	1Q 2009
Revenue	$423 million	$460.8 million	-8.2%	$434.8 million
Net income	$12.8 million	$21.7 million	-41%	($13.8 million)
Net income per share	15 cents	25 cents	-40%	(16 cents)

+ Boyd Gaming operates the California, Fremont and Main Street Station in downtown Las Vegas and locals properties Sam’s Town, Suncoast, Gold Coast and Orleans.

+“Results were especially encouraging in our Midwest and South and Downtown Las Vegas regions, both of which posted gains for the quarter. These regional performances helped to offset difficult economic climates in Las Vegas and Atlantic City and demonstrate the value of geographic diversification to our company.” – Keith Smith, president and CEO.

+ Boyd stock hit 52-week highs April 28 ($8.13), April 29 ($9.20) and April 30 ($9.80).

+ May 5 stock price: $11.31 (52-week high: $19.45)

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Boyd Gaming, which operates three downtown Las Vegas properties and four locals resorts in Southern Nevada, today added evidence to the outlook that the gaming industry may have hit bottom in the recession.

The company, which also has riverboat casinos in the South and Midwest and a 50 percent stake in Atlantic City’s Borgata property, narrowed its losses in the first quarter and executives said they liked the trends they were seeing.

“The recession continues to impact our business, but we’re encouraged by some positive trends that developed during the quarter,” Keith Smith, president and CEO of Boyd, said in a statement preceding a conference call with investors this morning.

The company reported a loss of $13.8 million, 16 cents a share, on revenue of $434.8 million for the quarter that ended March 31. In the same quarter a year earlier, the company had a loss of $32.6 million, 37 cents a share, on revenue of $471.1 million.

The loss included a charge of $28.4 million in connection with a write-off involving the company’s purchase of the Dania Jai-Alai fronton in Florida in January. Excluding the charge, the company would have posted a 15-cents-a-share profit. Analysts had projected the company would earn 8 cents a share.

Boyd was the third casino company this week to express optimism with financial developments that occurred late in the quarter. MGM Mirage on Monday and Wynn Resorts on Tuesday reported similar patterns.

“In our Las Vegas Locals region, we began to see signs of stabilization, while Borgata continued to outperform a severely challenged Atlantic City market,” Smith said in his statement. “Results were especially encouraging in our Midwest and South and Downtown Las Vegas regions, both of which posted gains for the quarter. These regional performances helped to offset difficult economic climates in Las Vegas and Atlantic City, and demonstrate the value of geographic diversification to our Company.”

The company said weakened consumer spending and reduced room rates affected revenue in the Las Vegas locals market, which includes the Sam’s Town, Suncoast, Gold Coast and Orleans. The company had net revenue of $170.1 million in that marketed compared with $206.5 million a year earlier. Cash flow suffered a 32 percent decline to $45.3 million.

But downtown Las Vegas, where the company operates the California, Fremont and Main Street Station, the company generated revenue of $58.7 million compared with $60.9 million a year ago. Cash flow jumped to $13.4 million from $10.2 million.

The company said streamlining operations and reducing costs have helped lessen the recession’s impact. At the end of the quarter, the company had $2.7 billion in debt and $98.2 million cash on hand. It spent $19.5 million on expansion, including $10.9 million in payments on the mothballed Echelon project on the Las Vegas Strip.

Boyd’s statement prior to its earnings conference call did not address the status of Echelon, a $4 billion project on 67 acres where the Stardust once stood. Boyd shut down construction on the project in August and did not specify when work would continue, but company officials have said it could be at least 2010 before a startup.

Discussion: 8 comments so far…

By markp

5/6/09 at 8:29 a.m.

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are these results encouraging because of all the cost cutting measures?
By adamj

5/6/09 at 8:43 a.m.

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Just spent a few days downtown, stayed at a Boyd property. Actually came home with a little money for the first time in a couple of years but not from a Boyd property, their machines were tighter than ever. Thanks for the small wins GN and El Cortez!
By SafetyNow

5/6/09 at 11:24 a.m.

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Wah Wah Wah Boo Hoo Wah Wah
That's all I'm hearing. Why should we care about the impact the recession is having on Boyd gaming. The recession is hurting everyone And here in the midst of it all Boyd expects the people to sympathize with them just because their not meeting their quota at the craps table?! How typical People are losing their jobs homes and entire families are being torn apart everyday and yet its the mufti billion dollar company executives we should feel sorry for? Give me a break.
By American_Gaming_Guru

5/6/09 at 12:43 p.m.

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If anyone in the industry cared about their employees, customers and neighborhoods they operate in, it is Boyd. Boyd is a class act in the business.
By acesbet

5/6/09 at 4:22 p.m.

Suggest removal

Just got back from a (3) stay at the "Pallazo".
The rooms were wonderful & and the amenities were surperb.

The slots were so tight we decided to go "Uptown" to Freemont St. Had a great time at the "Main St. Station" Food was reasonable and the Slots were not that hard on us. We even had some fun.

Boo Hoo for the Strip. They have not learned it is OK to "fleece" someone,but do it with some mercy. Planned to play in the May $7,500.00 slot tournament in June at the "Pallazo" not too sure now. Ace's
By SafetyNow

5/6/09 at 5:01 p.m.

Comment removed by staff.
By nonny2t

5/8/09 at 5:45 a.m.

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I do not live in Las Vegas, but it is my favorite destination of anywhere. One thing that has put a big damper on vacationing is the horrendous way the airlines are treating us. We are being overcharged for everything from baggage to bathroom use. Funny how companies like no frill Southwest seems to stay in the black, still provide decent pricing and do not charge for every little thing. I live 40 miles from 11 casinos in Tunica, MS. For those of you who have NO sympathy for gaming corporations, just remember they have EMPLOYEES just like anywhere else. I recently read that one of the corporations let 500 of their employees go so they are now on the unemployment line. Don't be so fast to judge, yes they make millions, but they also have folks working and getting paychecks just like you and I.
By SafetyNow

5/9/09 at 4:25 a.m.

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LoL so I'm wondering how many times american gaming had to flag my comment to get it removed lol more proof for the crack junkie that The truth hurts. Oh well flag away oh hallucinogenic one it still wont change the fact that BOYD has publicly proven over and over again just how little it cares for its employees...
Like Travis, Richard and Dave.
So once again good luck kicking the habit and escaping your current state of delusion