Boyd Gaming Corp. said the benefit from operating the five casinos the company acquired more than a year ago boosted the Las Vegas-based regional casino operator’s overall financial performance 2019.
The company, which operates 29 casinos in 10 states, credited the five properties with exceeding first-year performance expectations.
“Our diversified nationwide portfolio continued to generate strong results in the fourth quarter of 2019, as every segment of our business achieved growth in same-store revenues and adjusted (cash flow),” Boyd Gaming CEO Keith Smith said. “It was a very successful year. We are operating smarter and more efficiently.”
Net revenue in the quarter that ended Dec. 31 rose 5.2% to $833.1 million, with the largest jump – 7.6% – coming from the company’s Midwest and South division, which included the five casinos: Valley Forge Casino near Philadelphia, Ameristar Kansas City and Ameristar St. Charles, near St. Louis; Belterra Resort in Indiana and Belterra Park in Cincinnati.
“As we pass the one-year anniversary of the Ameristar and Belterra acquisitions, we have exceeded our initial expectations for our first full year of ownership,” Smith said. “As we continue to identify best practices and opportunities for additional synergies, we expect to realize further value from these acquisitions in the year ahead.”
Smith said the Belterra Resort in Indiana, which draws business from nearby Louisville, Kentucky, has been hurt by the growth of historical horse racing games, a slot machine type product, that is becoming popular in the market.
“Cash flow was down 1% at the property,” Smith said, adding the overall results still exceeded expectations.
Smith said the company’s sportsbooks in Pennsylvania, Indiana and Iowa – which are run in partnership with FanDuel – attracted new customers to the properties.
Boyd is waiting on Illinois to launch sports betting – the activity has been approved but the regulations are still being drafted. The company would add a FanDuel branded sportsbook at its in Par-A-Dice riverboat casino and hotel in East Peoria.
“With market access in 15 states across the country, representing more than 36% of the U.S. population, Boyd Gaming is well-positioned as additional states consider legalizing sports wagering,” Smith said.
The company’s net income in the fourth quarter rose 6.2% to $24.3 million and earnings per share jumped 6.9% to 21 cents per share.
For all of 2019, Boyd Gaming grew revenues 26% to $3.33 billion.
In the south, Boyd officials said the company is considering moving the Treasure Chest Casino in the New Orleans suburb of Kenner, Louisiana to an adjacent land-based facility. Smith said the riverboat casino, moored on Lake Pontchartrain, is a three-story, 30-year-old casino.
The company hasn’t made any decision on a move, a process legalized in 2018 by Louisiana lawmakers.
Boyd’s downtown Las Vegas revenues grew 3.4% to $69.9 million during the fourth quarter while the company’s Las Vegas locals market casinos grew revenues to $223.9 million, a less than 1% percent increase. For years, Boyd’s downtown casinos grew revenues 3.8% to $257.6 million while the Las Vegas locals market was up 8.4% to $880.9 million.
Boyd’s total debt at the end of 2019 was $3.81 billion.
#exclusive – New properties help Boyd Gaming boost 2019 financial results. –@howardstutz, CDC Gaming Reports. https://t.co/Lg3HRewQXJ @boydgaming #CDCgaming
— CDC Gaming Reports (@CDCNewswire) February 21, 2020
“Our locals segment continues to perform at near-record levels,” Smith said. “Revenue growth in the quarter remained consistent with trends we saw throughout 2019. As we begin 2020, we are encouraged by the trends we have seen in January and remain optimistic for the full year. The fundamentals of our locals business have not changed.”
During the question and answer session with analysts, Smith said the company still finalizing plans with the Wilton Rancheria tribe in Northern California for a casino project just south of Sacramento. He said construction could begin soon after the financing is secured for 18-month build out.
“We plan to develop a first-class resort that takes full advantage of this attractive location and allows the Wilton tribe to realize the significant potential of this opportunity in the coming years,” Smith said.
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at hstutz@cdcgaming.com. Follow @howardstutz on Twitter.
