Casino operator Boyd Gaming posted its fifth consecutive quarter of revenue growth thanks to continued strong performance at its Atlantic City casino and a healthy rebound in its Las Vegas locals business.
For the three months ending Dec. 31, Boyd’s overall revenue increased 2.1% to $542.7m while adjusted earnings rose 13.1% to $154.2m. The company reported a net loss for the quarter of $6.9m, a significant improvement over the $32.4m loss Boyd reported in Q4 2014.
Revenue in Boyd’s Las Vegas Locals segment rose 4.8% to $158.8m, while adjusted earnings rose 10.7% to $44m. The results are the best the segment has reported since the pre-recession heyday of 2007 and the company says it expects continued progress in 2016, with both gaming and non-gaming revenue enjoying broad-based growth.
Revenue was similarly sunny in the Downtown Law Vegas segment, which improved 4.8% to $62.5m on significant increases in visitation by the segment’s loyal Hawaiian clientele. Revenue at Boyd’s Midwest and South ($201m) and Peninsula ($120.5m) segments were basically flat year-on-year.
Boyd has a 50% stake in Atlantic City’s market-leading Borgata property, which reported revenue up 7.7% to $193m and earnings up 27.3% to $46m. The Borgata continues to fire on all cylinders, setting Q4 records for gross slot win and hotel occupancy, while notching an all-time record gaming market share of 30.4%.
On the conference call with analysts, Boyd CEO Keith Smith referenced the Borgata’s recent “self help” program, aka the refusal to pay property taxes until the local government honors a court order to refund tens of millions the city was determined to have overcharged the casino in recent years. Smith said the casino was “ready and willing” to discuss the matter but was having a hard time getting the city to engage.
Smith also suggested Boyd might be interested in one of the two proposed North Jersey casino licenses but at the moment there were simply too many unknowns regarding tax rates and other rules to make a proper determination of whether this is an opportunity Boyd would be interested in pursuing.
Sadly, Smith offered no comment whatsoever regarding the Borgata’s market-leading online gambling operation in New Jersey’s regulated market. Bwin.party, the Borgata’s technology partner, was recently absorbed by rival GVC Holdings, and the ensuing scuttlebutt had the Borgata mulling whether to maintain its existing online tie-up.
