Boyd Gaming narrows net loss in fourth quarter

13 February 2015

LAS VEGAS -- Boyd Gaming Corporation narrowed its net loss in the fourth quarter as results from its regional markets and Las Vegas locals properties grew in the final months of 2014.

Following a conference call with analysts Thursday, Boyd Gaming CEO Keith Smith said he isn’t ready to declare the locals market completely recovered. The company operates the Coast Casinos, Inc. brands and Sam’s Town and has embarked on an effort to improve non-gaming offerings.

“It only picked up at the end of the year, so it’s still too early,” Smith said of the market where overall revenue increased 2.1 percent in the quarter that ended Dec. 31.

Smith said the company’s Las Vegas properties had their strongest growth quarter since before the recession, but attributed much of the success to non-gaming revenue, which grew 14 percent through increased hotel room rates and restaurant sales.

Las Vegas-based Boyd Gaming said its net loss for the fourth quarter was $32.4 million, or 29 cents per share. A year ago, the company lost $47.3 million, or 43 cents per share. Boyd Gaming said it took impairment charges of $40.6 million during the quarter, which was reflected in the net loss.

Overall, the company reported fourth-quarter net revenue of $531.6 million, an increase of 1.4 percent. Boyd Gaming had overall revenue of $2.14 billion in 2014.

In addition to Las Vegas, the company cited improved results in regional markets, where revenue increased 2 percent and at the Borgata in Atlantic City, which showed a 14 percent revenue at the end of the year.

On Thursday, Atlantic City released gaming revenue figures for January and Borgata Hotel Casino and Spa showed a nearly 17 percent increase. Smith said the casino, considered the market leader, picked up a large share of business following the closings of four casino last year.

“The good news is the business stayed in the market,” Smith said.

On the conference call, Smith and Boyd Gaming CFO Josh Hirsberg said the Borgata’s Atlantic City market share continued to grow because the casino gained customers from the region. Boyd said it still expects to receive $88 million from Atlantic City in a property tax settlement.

Boyd’s three Downtown Las Vegas casinos reported flat gaming revenue in the third quarter. Smith said the properties, which draw some 65 percent of their customer based from Hawaii, said tour and travel packages have a set price for hotel rooms. He said the rates for hotel rooms not part of the Hawaiian packages was up 5 percent in the quarter.

Analysts asked Smith if Boyd, which operates 22 casinos in eight states, was looking at expansion opportunities. Other than a long-standing agreement with a Sacramento, Calif., Indian tribe to manage a potential casino, the company has nothing on the horizon, he said.

Smith said the company “is not a big fan of having multiple assets in the same markets, which limits the opportunities.”

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