A Santa Fe Station patron heads for the property's recently opened poker room Wednesday. Station Casinos said it will spend $120 million to improve Santa Fe Station. Photo by Isaac Brekken.

Boosted by a booming local economy, Station Casinos on Wednesday posted first-quarter earnings, reversing a year-earlier loss related to a heavy debt-retirement charge.

The Las Vegas casino operator said net income was $40.6 million, or 59 cents per share, for the three months ended March 31, reversing a loss of $29.8 million, or 48 cents per share, a year earlier.

Pretax earnings rose 28.5 percent to $120.9 million, beating Station Casinos' projections of $117 million to $119 million in pretax earnings. A year ago, Station had $94.1 million in pretax earnings.

"These results were obviously a reflection on the strength of the Las Vegas market," Station Casinos Chief Financial Officer Glenn Christenson said.

The company said its adjusted earnings per share, which excluded one-time items, was 70 cents, up from 51 cents per share a year ago and the 67-cent average Wall Street estimate from Thomson First Call.

Revenue rose 14.4 percent to $273.4 million from $239 million

In addition, company executives told analysts it was raising its earnings-per-share guidance for the second quarter to a range of 61 cents to 65 cents and full-year earnings-per-share guidance to a range of $2.43 to $2.55.

In trading Wednesday, Station Casinos closed at $65.54, down $2.71 or 3.97 percent.

"The Las Vegas local's market is the best gaming market in the country," Station Casinos President Lorenzo Fertitta said in a statement. "The stable regulatory, political and tax environment in Nevada, the strong Las Vegas economy and positive supply and demand characteristics in this market are the drivers of our business model."

Previously, Station Casinos announced it was accelerating the expansion plans of Red Rock Station, kicking up the cost of the Summerlin project to $800 million and expanding the hotel's number of rooms to 850. The first phase of the resort is expected to open by the end of March with the second phase to follow by the end of next year.

Christenson said the demographics for Red Rock Station, "are even stronger" than the area that surrounds the company's Green Valley Ranch casino in Henderson.

Station Casinos used its quarterly earnings release to announce it was accelerating the expansion of two other company projects: Santa Fe Station in the northwest and the Fiesta Henderson.

The company will spend $120 million to, add a 2,900-space parking garage, add a 500-seat buffet, add 400 additional slot machines, remodel and expand the race and sports book and add a 15,000-square-foot meeting and banquet hall at Santa Fe Station. Construction will start in August and finish by September 2006.

At Fiesta Henderson., Station Casinos will spend $70 million to add a 1,500-space parking garage, add 350 slot machines, expand the race and sports book, and add a 12-screen movie theater. Construction is expected to start in July and be completed by June 2006.

"These are two incredible markets," Christenson said. "The area around the Santa Fe is growing rapidly and Henderson is the third fastest growing city in America. These expansions are geared toward the local market."

Christenson also said the borrowing rate for money to fund the expansions was about 5.9 percent, making the expansion economically feasible.

The company is master-planning two new developments: Durango Station at the southeastern portion of the Beltway Durango Road and a Strip-style casino on the site that currently houses the Wild Wild West on Tropicana Avenue near Industrial Road.

Gaming analysts said the newly announced expansions made sense, given the Las Vegas market's growing demands.

"Station Casinos continues to have the most visible growth profile of gaming operators serving the Las Vegas locals market," Deutsche Bank gaming analyst Marc Falcone said.

"Looking further ahead, we would expect Station Casinos to announce further expansions and new projects given a low cost of capital and the strong Las Vegas locals market characteristics."

Bear Stearns gaming analyst Joe Greff said Station Casinos will continue to place its stamp on Las Vegas.

"To us, the Station Casinos story remains simple," Greff said. "Station Casinos, in our view, remains the best growth story with the most visibility among the gaming operators, with attractive supply-demand dynamics in the locals market plus a laddering of growth projects that goes through 2010."