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twitterStation Casinos’ loss widens on reorganization costs
Monday, Nov. 16, 2009 | 7:28 a.m.
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Las Vegas locals gaming leader Station Casinos Inc. today disclosed it incurred $370.7 million in costs related to its bankruptcy reorganization, driving a quarterly loss of $455.4 million.
The third quarter 2009 loss compares to $23.4 million lost in the third quarter of 2008.
Net revenue of $255.7 million was down from $317 million as high unemployment in the Las Vegas area, now 13.9 percent, reduced spending at Station's 18 Las Vegas-area properties.
Factoring out the reorganization costs, Station would have lost $84.7 million.
On a sequential basis, Station's decline in net revenue of 19.3 percent was an improvement from the second quarter, when net revenue fell 21.2 percent.
Station said that during 2009's third quarter, casino revenue fell 18.6 percent as customer visits and spend per visitor fell. Food and beverage revenue was down 19.6 percent.
At the company's hotels, room revenue was down 21 percent as occupancy of 84 percent was down from 90 percent and the average daily room rate of $61 was down from $77.
In the Chapter 11 bankruptcy case filed July 28, cash payments for the nine months ended Sept. 30 for professional fees and retainers and other reorganization items totaled $50.8 million.
Other reorganization costs included $319 million for losses on interest rate swaps and write offs related to changes in the values of expected debt discounts and debt issuance costs.
Related accounting adjustments in the quarter lifted Station's total debt and liabilities to $6.818 billion vs. $6.49 billion at the end of the second quarter.
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Locally owned and independent for more than 50 years.
Maybe when they close down they can make arrangements with Joe Jackson and turn their properties into 18 little Michael Jackson Museums.
Perfect example of taking a company private, looting it by taking most equity out of the business by going private, issuing huge amounts of debt, and then going BK. Identical situation at Lake Las Vegas. The banks take a haircut, the Fertittas and the like make a bundle, and laugh their way to Malibu. Oh, and the banks either fold or are bailed out by the government, as in taxpayers.
I went to Sunset Station several times recently, and mostly had the place to myself. Gee, the slots were a little tight, too....
Lake Las Vegas was different. The BANKS did the looting!! The builders were 2nd in line and allowed to take their profits..each time, Credit Suisse kept upping the pot...CS should go to Jail just like the other companies. I know, cause I own (giving it back) a house there..
once again the casino operators are spoiled from the big boom of the city.they need to change the odds and losen the slots to help draw people back into their resorts.OOOOPPPPSSSSS!!!!THa would be to smart.
Partially correct retiredyoungster, the original looters were the Transcontinental Corp (Bass Brothers and Ron Boeddecker), who took out a huge loan on the property's equity from CS, and then waltzed back to Texas with their pockets stuffed. After that, the place went in a long downward spiral that seems never ending.
RJ Oct 2009
"Lake Las Vegas President Frederick Chin filed papers criticizing Transcontinental for pocketing $470 million in cash from a $560 million loan made to the resort in 2004."
Anyway, best of luck, retiredyoungster. I'm still wondering what's going to happen to CML-I have a lot of friends working there sitting on pins and needles. Hi, Bouvier, still on the porch?
Comment removed by staff.
Maybe if they treated their customers right & not have resort fees for a $20 Hotel Room, then they would have stayed afloat.
1st the Station stock holders need to get rid of the Fertittas, 2nd they need to put in a staff that knows how to treat people.
Stations has made all their slots so tight it not worth playing a single one, they treat the regulars like visitors from out of town - instead of valued customers, and they been firing staff to reduce overhead under BS circumstances to avoid paying unemployment.
It is for these very reasons I will not step into a Station Casino property.
Station lost my respect with Red Rock. $25 resort fee there. Rooms are over priced and the package deals are never available. Their ads are very misleading.
I hope someone new takes over and runs the place right.
Easy money breeds upon itself making everything more attractive than reality...we are talking hedge funds and cash flow projections, in order. Too much chasing the last decimal point of return; too much instant commission upon deals primed for tomorrow; too high design standards for a local's casino; and, of course, too much hubris all around! What a bunch to have for a party...uh, who's paying?
"Station Casinos Inc. today disclosed it incurred $370.7 million in costs related to its bankruptcy reorganization"..imagine how many jobs they could have saved with that kind of cash? Turn the keys over to Boyd already and save this business from going bust!
if these two as-holes get away with this, then they ought to turn madoff loose!!!!!!!!!!!!!
mk, right on.
No surprises on the high cost of attorneys fees on the Station Casinos case.
Station is paying top dollar attorneys fees (sometimes approaching $850 per hour) for their own lawyers, their directors lawyers, Deutsche Bank's lawyers, the unsecured creditors' lawyers. If I left out any category of lawyers feeding at the trough, I'm sorry.
In case anyone hasn't noticed, the principle benefit of Chapter 11 cases is enriching the elite of the Chapter 11 bankruptcy bar. All the better if there is a Chapter 11 examiner or trustee, so those boys get their cut. All of these attorneys fees are paid before the unpaid, unsecured creditors see a penny on what they are owed.
Folks here just have to get used to the idea that Vegas as we know it is history. There are going to be hotel closures, BK's and all sorts of changes that are going to take place here before light at the end of the tunnel becomes evident. It's going to be a whole new order of how the gambling and resort business operates in the valley. Unfortunately all indications are that these changes are NOT going to be in favor of us.
I normally never write comments, but most of them on here make me laugh.
You really all dont know what you are talking about. For those of you who wish not to come to a Station Casinos hotel, dont come. It is YOU who will be helping to continue the weakening of our Vegas economy.
American Gaming Guru - As for Boyd, they only had a quarterly decrease in Net revenues of
-27.5%. they need to get their own ship afloat before they consider taking on more responsibility. Ever been in any of their dirty hotels? Talk about disgusting. You may not like Stations, but at least their hotels are clean and inviting.
Again, when you all ACTUALLY know the business, you will gain a better understanding of how it all works. Until then, everyone relax and support your local economy and that means all the hotels. If you dont like it, move to LA. If you havent lived there before, then you have no idea of how well you actually have it here versus there!
Here is betting that when times are good again, and they will be good again, that you will all frequent the properties you now scold.
If you listen carefully i think you will hear a bandwagon coming by with more people looking to climb off of.
And what is supporting a casino that is mismanaged and left for rot going to do? Why visit a place that doesn't value you as a customer? Because of what exactly? Saving jobs? Psst. That is the problem right there. We as Las Vegans are conditioned to support gaming until the very end, despite the fact it is declining rapidly. What is it going to take to make people realize economic diversification is the answer, not placing a coin in a machine.
And by the way, I'm born and bred here. Vegas lost its way when the corporations got in bed with Wall Street. See the common theme? Everything Wall Street touches rots. They loot the house and leave the vermine. Utilities (i.e. Enron)? Check! The Dot coms in the late 90s? Check! The mortgage crisis? Check! Just wait until the so-called cap-and-trade legislation goes through. The U.S. will become a feudal state and third-world country.
I agree with environprotector, Vegas will get alot worse for the hotel owners. City Center coming online with another 6000 rooms can't be good, it might be good for a little while and then the newness will wear off. As far as Station's, I don't think Boyd Gaming should buy them, that would give them control over most of the locals market. They would be able to set their price for everything. Also, what about Station's joint venture with Greenspun corp. Is it a 50/50 or does Station's have more control? It might be in Greenspun corp's better interest to get out or buy one of the casino's from Station's. Just a thought.
Secret to Stations turnaround:
Free Rooms, Free UFC, Free Food, Free Chips, Free Parking
Free James Brown
Iknowmoreabouthotelsthanyou...I certainly do know how they operate. And contrary to the tone of my posts, I have always been a fan of the Station properties and organization. What bothers me is that Colony came in at the height of the market (with the Fertittas participation) and over-levered these properties. We all know what happened next. The real gall here is that Colony and the Fertittas cashed out BIG by the LBO, but how much more equity have they put in to stabilize the organization? Instead, many loyal station employees were cut loose and customer loyalty began to suffer for lack of service and quite simply comfort. Look at what Sheldon did at LVS. When the debt load of the company got over-bearing, he pledged over $1 BILLION of his own equity to save the company. What has Station management done? They took a play out of Trump's playbook which is esstntiall declare BK and try and screw your debtors and come out with a clean balance sheet. I understand that they have pledged additional capital as a part of their BK plan, but not nearly as much as Boyd has. Boyd's properties may not come close to some of the newer and more flashier Station properties, but if you compare apples to apples in terms of Station's older portfolio to Boyd's, I think they are very similar. So why do I root for a Boyd take-over? Simply because I think they are a great operator with a respectable reputation in the community and with a better reorganization plan for Station. A little discussion is always fun "Iknowmoreabouthotelsthanyou". I appreciate your feedback.
boo hoo for station casinos!! they are the worst place to gamble!! i wouldn't walk to a station casino if it was across the street!!
History has shown that Stations is following a pattern of deceit in their operations. They put their plan to the test in their takeover of the Pride MMA and then refined it in their quest to take Stations from the creditors after mortgaging the company to the hilt. Read their practice run and tell me this all wasn't planned...
http://westcoastpoppin.com/popping-locki...
ok - here is my take on the matter:
Just got back from Vegas last week:
went to Palace Station to find my former host - who now has moved on to Texas Station - ok - went to Texas Station - played about 3 hours and didnt even get a bonus round on any machine - Lost about $300. Went to Red Rock also - was there about 3 hours also - did play one machine - deal or no deal and got the bonus round about 5 times - I did make about 100 bucks - BUT the food was so high in price - whats up with the price of food at the stations??
I stayed downtown at the plaza - won a few small jackpots - $200 or so - but nothing big anyplace - noticed 2 winners - 1 on a video poker - and one on a video keno - other than that nothing anyplace - think that the slots are all at the min the state allows - I have been going to vegas for many years and this is the first time that I did not hit a jackpot of $500 or so - I am not talking thousands - just a small one to keep you playing.
I come with other people - take 4 rooms and such - coming back 1 more time in Feb for the nascar race and thats it - coming from Florida is a long flight - until they start to pay off - probably will just take a spin down I -95 and hit the casinos in south florida and maybe try atlantic city.
soooo - its not just staions casinos not winning - its all of them....
followup to my comment:
Get John Sands to run the Stations Casinos - he was a great host - he could do it!!!