Golden Entertainment is hoping that Nevada will share plenty of similarities with Montana. The Strat’s operator, as well Arizona Charlie’s and 60 Las Vegas pubs and taverns, thinks pent up demand could mean big revenues when Governor Steve Sisolak eventually allows Nevada gambling operations to resume.
Montana’s recently re-opened slot machine locations have revealed pent-up demand at pre-closure levels, causing CEO Blake Sartini to be optimistic on a conference call about what it could mean for Nevada locations, which they hope will reopen by the end of May. “We have not missed a beat in Montana,” Chief Financial Officer Charles Protell added.
But before getting to that good news, they covered the financial hit the company has taken. Golden Entertainment Inc has drawn from its $200 million credit facility and deferred capital expenses to endure the COVID-19 pandemic, and reported a 13.6 percent decline in revenue. Net losses are up by a multiple of four year over year.
“The COVID-19 pandemic forced the mandated closure of all our operations beginning in mid-March and continues to have an unprecedented impact on our business and the gaming and entertainment industry in general,” Sartini said. “This is reflected in our first-quarter financial results, notwithstanding our significant year-over-year growth through February prior to the suspension of our operations.”
But assuming Nevada has the same pent up demand as Montana, Sartini is hopeful they can stick to the plan of renovating the Strat and keeping the business growing. “Our current cash position, capital structure with no near-term debt maturities and diverse operations of wholly owned casinos and distributed gaming operations across multiple jurisdictions will position Golden Entertainment favorably to achieve long-term success as we are allowed to reopen our properties,” he said.
Specifcially citing Golden Entertainment’s record with drive-in customers, as opposed to fly-in customers who may still be months away from returning, he expects the industry will be booming again soon.
Protell also noted that the Strat is is a great position to implement social distancing rules. With a floor designed to hold 2,000 slot machines, it only had 750 at the time the property was acquired.
Spacious Montana has already started reopening, with some children already going back to school. The state announced as early as April 22 their plan to reopen, as their number of new infections is effectively zero, having reached 456 and stayed there, with only one new case in the last week.
While Nevada has started to talk about reopening some businesses, Gov. Sisolak has said gambling operations will have to wait. Nevada’s curve has flattened, but with around 100 new cases a day still being found, they have to take it slow, or risk a new spike in the curve.
