Boyd Gaming Provides Updates On Its US Casinos During Q2 Earnings Call

Written By Nicholaus Garcia on July 27, 2022
Earning Call From Boyd Gaming Q2 Comes With US Casino Updates

Despite high inflation and recession fears, Boyd Gaming reported its second-highest quarterly adjusted earnings in history. The company also provided updates on several of the US casino projects it has in development. 

During the company’s Q2 earnings call, President and Chief Executive Officer Keith Smith reassured analysts the core customer base remains the priority. Smith also said the opening of three new properties will help expand the company’s customer base and drive enhanced results.

As of writing, shares of $BYD were trading at $55.75.

Retail US casino updates

Boyd has projects in different stages of development stretching from Louisiana to Northern California. During the call with Wall Street analysts, Smith provided an update on three projects.   

Louisiana

Smith said Boyd has begun working on its new Treasure Chest Casino in Louisiana. The property is expected to open in late 2023.

“Once complete, this project will significantly enhance our gaming and non-gaming amenities, creating a more attractive and competitive entertainment experience. We are confident the all new Treasure Chest will further expand the property’s customer base while increasing its appeal to our existing customers.”

Las Vegas

Over in Nevada, the company continues to work on its expansion of the Fremont Hotel and Casino.

“We are making good progress on construction and are on track for completion around the end of the year,” Smith said. 

Boyd has been busy expanding the Fremont casino space and adding several quick-serve restaurants hoping to capitalize on foot traffic throughout Fremont Street in downtown. 

California

Lastly, Smith touched briefly on the new Sky River Casino on behalf of the Wilton Rancheria Tribe. The 100,000-square-foot casino just south of Sacramento will have 2,000 slot machines, 80 table games, and 17 food and beverage venues. 

Boyd has a seven-year agreement to manage the Sky River Casino and will receive a standard management fee. 

“We look forward to a successful opening of Sky River and are proud to partner with the tribe as they achieve their vision of self-sufficiency,” Smith said. 

The casino is on pace to open in early September.

Boyd Gaming’s approach to its US casino players

While there are rising fears of a potential recession, Smith said a few economic factors are working in the company’s favor. 

“As we look at our business today, there are two important themes worth noting: the stability of our financial performance and the continued strength in our customer trends.”

Josh Hirsberg, executive VP, chief financial officer, and treasurer, added,

“Driving our business and overall performance is a focus on a very loyal and high-quality customer.”

Hirsberg continued:

“Business today feels very different than pre-COVID, in the sense of who the customer is, our focus on that customer, and how we’re marketing to that consumer. Insightful for us is our core customer [base] that we’re reinvesting in, continues to be very stable and grow.”

Boyd Gaming quarter two earnings numbers

Despite a 6% decline in its gaming business, Boyd reported a modest year-over-year revenue increase. The company generated $894.5 million in revenue, a 0.1% increase from Q2 of last year. This is another positive after the company posted strong margins during its Q1 earnings call in April.

Customer trends relating to “Food & Beverage” accounted for 8% of Boyd’s total Q2 revenue. Smith said volumes from core customers continue to grow, driving profitability. 

“Our hotel bookings are running ahead of 2021 levels with no change in cancelation activity to date. Our customer trends in the second quarter and so far in July remain consistent with what we have seen over the last four quarters. And while these trends are encouraging, we recognize there are also challenges in the economy.”

Breakdown by sector:

  • Food & Beverage: $70.3 million
  • Room: $50 million
  • Other: $89.3 million

As expected, “gaming” accounted for most of the Q2 revenue bringing in roughly $685 million. However, compared to the same period last year, gaming experienced a $40 million decline.

Photo by Shutterstock.com
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Nicholaus Garcia

Nick Garcia is a senior reporter for PlayUSA. Garcia provides analysis and in-depth coverage of the gambling industry with a key focus on online casinos, sports betting and financial markets. Garcia has been covering the US gambling market since 2017. He attended Texas Tech University as an undergrad and received a Master of Arts in Journalism from Columbia College Chicago.

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