Boyd Gaming has announced impressive third-quarter results, attributing its success to strategic property investments, growth in downtown Las Vegas, and strong performance in regional markets. The company reported annual gains in both revenue and earnings, bolstered by a significant $750 million project underway in Norfolk, Virginia.
Key Highlights from the Third Quarter
During a conference call with Wall Street investors, Boyd Gaming’s president and CEO, Keith Smith, shared insights into the company’s performance. He noted that property-level margins exceeded 39% in the third quarter, with stable underlying customer trends.
- Performance Metrics:
- Flat Play Volumes: Overall play volumes remained essentially flat year-over-year, with the exception of a challenging first quarter due to weather conditions.
- Las Vegas Trends: The third quarter reflected similar trends to the first half of the year, although the Orleans and Gold Coast properties faced competitive pressures.
Excluding the Orleans and Gold Coast, Boyd reported EBITDAR margins of 49% during the quarter, indicating strong operational efficiency. Hotel revenue in Las Vegas continued to rise, driven by increased demand, particularly in downtown areas.
Downtown Las Vegas and Regional Success
Boyd’s investments in downtown Las Vegas have paid off, with the Fremont Hotel & Casino achieving record third-quarter revenue and EBITDAR performance. Smith highlighted the benefits of strong pedestrian traffic throughout the downtown corridor, which has contributed to the overall success of Boyd’s properties.
- Economic Fundamentals:
- Strong Visitation: The southern Nevada economy remains robust, with strong visitation and broad-based job growth.
- Housing Market Expansion: The ongoing expansion of the housing market further supports economic stability in the region.
Outside of Las Vegas, Boyd’s Midwest and South segment also performed well, particularly with the Treasure Chest Casino in Louisiana, which opened its land-based casino in June. Smith noted that the casino is on track to exceed targeted EBITDAR returns.
Growth in Online Gaming and Future Prospects
Boyd’s online gaming segment continues to thrive, thanks in part to its partnership with FanDuel. Based on this strong performance, the company has raised its full-year EBITDAR guidance by $75 million, increasing it from $65 million to $70 million. This includes the recent acquisition of Resorts Digital Gaming in September.
- Strategic Positioning:
- Prepared for Expansion: Smith emphasized that Boyd is positioning itself to expand into new states as they approve iGaming.
- Managed Business Outlook: Boyd’s managed business is projected to generate $90 million in EBITDAR in 2024.
Smith also discussed ongoing renovations across Boyd’s properties, including updates at the Gold Coast and Orleans in Las Vegas. Renovations at the Suncoast in the west Las Vegas Valley are expected to take another 12 months, with plans for a new food hall and expanded meeting space.