As the temporary shutdown of casinos across the U.S. lingers on, at least through the end of the month, casino operators are being forced to take drastic measures in order to stem their financial losses. Some companies have been able to squirrel away more funds over the years and are better equipped to weather the coronavirus, while others, for various reasons, are strapped for cash. As the situation becomes more difficult with each day that passes with no gambling action, nothing is safe from being discarded in order to cut expenses. Boyd Gaming, like the majority of the casino operators in the U.S., is having to make the tough decision to let go some of its staff in order to save money.
Boyd said in a press release yesterday that, as of this Saturday, an unspecified number of employees will be on extended obligatory vacation. Any of the employees who are currently enrolled in the company’s health care plans will continue to have their insurance premiums covered by the company, but everyone else is apparently on their own. The company adds that a “limited number” of employees will still be on the payroll while the shutdown continues.
Keith Smith, the company’s president and CEO, asserts, “This is by far the most difficult decision we have ever made. We care deeply about the well-being of our team members, which is why we maintained full pay and benefits through April 10. Implementing furloughs was a last resort for us, but a necessary step to protect our Company, especially given the current lack of visibility regarding property re-openings.”
But, it’s not all bad news for the company. On the bright side, the upper echelons will be able to enjoy a solid long weekend to celebrate Easter. The press release also indicates that the executive leadership team will take “significant salary reductions” and that the members of the Board of Directors will suspend their compensation. Boyd adds, “Additionally, all non-furloughed members of the Company’s corporate and property management teams will take a salary cut.” It didn’t mention how much of a cut any of the individuals would be taking.
In addition to the furlough and executive pay cuts, the company is also prepared to halt all non-essential purchases and suspend all of its capital projects. Smith adds, “As a result of these difficult but necessary actions, we are confident Boyd Gaming will have sufficient liquidity and resources to sustain itself until we are able to re-open for business. We will continue to carefully review our operations and expenditures during the closure period and make additional adjustments as necessary.”
Some casino operators, such as Wynn Resorts, Las Vegas Sands, and most recently, Station Casinos, have agreed to pay their furloughed employees into May. Other companies have seen their top brass completely waive off compensation for the rest of the year to provide wages for their workers, something that shouldn’t be too difficult to do with compensation packages that range in the high seven-figure area.
The company can also take advantage of its stock to help offset losses, as well. It was trading on the NYSE at $10.92 a share last Friday, but has climbed to $15.58 as of yesterday afternoon. The company’s announcement came after the market closed, so sale orders will probably be numerous when it reopens.