Boyd Gaming (NYSE:BYD) has delivered another quarter of top- and bottom-line growth. The company's recently released second-quarter report shows that the casino and hospitality company continued to benefit from favorable economic trends in the Downtown Las Vegas segment and solid operating results at its newly acquired properties.
Boyd Gaming results: The raw numbers
|Metric||Q2 2019||Q2 2018||Change|
|Revenue||$846.1 million||$616.8 million||37.2%|
|Net income||$48.5 million||$38.9 million||24.7%|
What happened with Boyd Gaming this quarter?
- The company's Las Vegas Locals segment reported revenue of $220.9 million, slightly up from $220 million in the year-ago quarter. Adjusted EBITDAR (earnings before interest, taxes, depreciation, amortization, and rent expense) came in at $71.4 million compared to $70.2 million a year ago.
- The Downtown Las Vegas segment reported revenue of $64.5 million, up 5.4% year over year. Adjusted EBITDAR for the segment jumped 17.4% over the year-ago quarter to reach $15.9 million.
- The Midwest & South segment saw the biggest year-over-year increase in revenue and profit due to the addition of new properties acquired last year. Segment revenue increased 67% to $560.7 million, while adjusted EBITDAR increased by 68% to reach $165.1 million. Excluding acquisitions, the segment still performed well, posting its fifth consecutive quarter of revenue growth and higher margins.
- The new properties from last year's acquisitions include Ameristar Kansas City, Ameristar St. Charles, Belterra Resort and Belterra Park, Valley Forge Casino Resort, and Lattner Entertainment. As a group, the new properties experienced growth in revenue, adjusted EBITDAR, and margins compared to the year-ago quarter.
What management had to say
In the company's press release, CEO Keith Smith expressed his satisfaction with the quarter, noting that the company saw growth in all segments even while dealing with a few challenges:
During the second quarter, our Company made continued progress executing against our strategic growth initiatives. Despite a few isolated challenges, we delivered revenue, adjusted EBITDAR and operating margin growth in every segment of our business, as our operating teams identified and drove profitable revenue growth and enhanced efficiencies.
Management maintained its full-year guidance for adjusted EBITDAR to be between $885 million and $910 million. Smith noted that the Las Vegas properties will experience disruption in the next few quarters as a result of the nearby Circa construction project that's putting together a 44-story resort, and this is reflected in the company's guidance.
Looking beyond the short term, management is optimistic about its new B Connected loyalty program, which is driving strong results. Plus, Boyd's partnership with fantasy sports provider FanDuel looks promising as the legalization of sports betting continues to gain momentum throughout the country.