Regional casino operator Boyd Gaming saw every of its geographic segments post revenue gains in the final quarter of 2019, thanks in part to sports betting options bringing in scads of new spendthrift customers.
Figures released Thursday shows Boyd generated revenue of $833m in the last three months of 2019, up 5.2% from Q4 2018. Operating income was up more than one-fifth to $114.8m while net income gained 6.2% to $24.3m.
Boyd’s mainstay Midwest & South segment posted the biggest Q4 revenue gains, rising 7.5% year-on-year to $539.7m, while the Las Vegas Locals segment was essentially flat at $223.8m and the Downtown Las Vegas segment gained 3.3% to $67.3m.
For the year as a whole, revenue was up 26.6% to $3.32b, operating income rose one-third to $472.6m and net income improved 37% to $157.6m.
The full-year gains reflect Boyd’s conspicuous consumption of other operators’ casinos in recent years, including four former Pinnacle Entertainment properties, Pennsylvania’s Valley Forge and the Lattner Entertainment video gaming terminal operations in Illinois.
Boyd hasn’t bought anything in a while, likely because its debt now tops $3.8b, and the rent it pays on the land under its expanded property portfolio nearly quintupled to $97.7m in 2019. So investors should enjoy the lull, however long it lasts, because they might finally get to compare apples to apples for a spell.
Boyd has a long history of sports betting at its Vegas casinos and has been eagerly adding sportsbooks to its casinos in other states courtesy of its deal with Flutter Entertainment’s FanDuel brand. Boyd now has active sportsbooks in Indiana, Iowa, Mississippi and Pennsylvania and plans to add betting to the Par-A-Dice casino in Illinois soon.
Boyd CEO Keith Smith has previously discussed the broader impact of welcoming new sports bettors to Boyd properties. On Thursday he told analysts that customers “don’t necessarily walk around with a button on that says ‘I came in to bet sports,’” making their impact on other gaming options at the casinos somewhat hard to quantify.
But Smith said “we’ve seen an uplift” in terms of spending on slots, tables, food & beverage and other amenities at every property that has added betting, so “it is very much a positive additional amenity for us.” Smith added that his company was already “profitable when it comes to sports betting where a number of our peers are not.”
As for online casino gambling, Smith noted that FanDuel has launched a site in Pennsylvania and Smith said Boyd “would anticipate launching a product there.” Smith added that this product would be “branded differently,” although he didn’t specify what other form this brand might take.
