Las Vegas Sun

March 28, 2024

Boyd Gaming 4th-quarter loss widens on expenses

Updated Tuesday, March 1, 2011 | 10:23 a.m.

With unemployment in the Las Vegas area running at 14.9 percent, Boyd Gaming Corp. today reported revenue and profitability declines for its Las Vegas locals' hotel-casinos during the fourth quarter of 2010.

Net revenue for the locals' casinos including Sam's Town and the Orleans was $152.1 million, down from $155 million in the fourth quarter of 2009 when unemployment was about 13 percent.

Fourth quarter adjusted EBITDA -- a profitability measure -- was $34.1 million, down from $34.7 million in the 2009 quarter. EBITDA means earnings before interest, taxes, depreciation and amortization.

Despite the declines, Boyd today said: "These results marked the region's best year-over-year comparison in 12 quarters, as our operating margins remained consistent and local economic conditions began to stabilize."

Boyd's downtown Las Vegas casinos including Main Street Station and the California reported similar declines, with net revenue of $57.1 million down from $58 million and adjusted EBITDA of $10.9 million down from $12.2 million. Boyd, however, said its market share there increased.

Companywide in the quarter, Boyd reported higher expenses as it lost $7.1 million, or 8 cents per share, compared to a loss of $1 million, or 1 cent per share, in the same period last year.

Net revenue of $551.9 million was down 1.5 percent.

"As expected, fourth-quarter comparisons were the best of the year, as business conditions and consumer confidence continued to improve. As the economic recovery gains momentum, we anticipate we will see increases in both visitation and spend-per-visit, resulting in a return to consistent growth across our business this year," CEO Keith Smith said in a statement.

During a conference call with analysts today, Boyd executives said their Las Vegas locals' business has not been hurt by competitor Station Casinos Inc.'s aggressive new "We Love Locals" promotions, with Boyd's locals' casinos seeing "coin-in" slot machine revenue unaffected.

For its Suncoast hotel-casino near Summerlin in western Las Vegas, Boyd is working with developers of the Tivoli Village mixed-use center opening this year on joint marketing efforts to capitalize on increased traffic Tivoli Village will bring to the area.

In downtown Las Vegas, the company's profitability may be hurt by rising fuel prices for its Hawaiian air charter business. But the Hawaiian market remains strong and Boyd has boosted its downtown market share to 35 percent, executives said.

Overall in Las Vegas, increases in taxable sales and higher visitation numbers to the Strip are encouraging signs that the recovery is picking up steam as many of the Strip hotel-casino workers are Boyd's local customers.

"Our core business is improving," Smith said on the call.

"People are going back to work (on the Strip). They're getting more hours. These are our customers," Smith said.

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