Updated July 28, 2020 - 10:32 pm
Despite dampened foot traffic inside Boyd Gaming Corp. hotel-casinos, President and CEO Keith Smith said the visitors who are coming are spending big, and the cost-cutting measures in place to weather the pandemic — like closing buffets — could be here to stay.
There have been fewer visitors 65 and older, but the number of younger visitors has been up and the company reported “robust” spending per visit in a Tuesday earnings call.
“Our core customers are not deterred by social distancing measures, limited amenities or masking requirements,” Smith said.
Despite one-time stimulus checks possibly playing a role in this spending, Smith believes these levels of gaming activity are sustainable.
Smith said the company has seen “significant companywide margin improvement,” even though the company is operating at roughly 50 percent capacity.
Revenue was $209.9 million for the second quarter of 2020, down 75 percent from the same period last year. Net loss was $108.5 million, or $0.96 per share.
The company has streamlined operating expenses and improved margins in its Midwest, South and Las Vegas segments by cutting costs in areas like marketing, labor and certain amenities, like buffets.
This month, the company laid off at least 2,500 Nevada employees as Las Vegas visitation numbers stood well below pre-pandemic levels.
Keith said the company “will not simply return to the old way of doing business,” and many of the cost cuts will be permanent.
“We intend to keep this philosophy in place after the crisis is over” and focus on high-worth customers, he said. “We think largely that many of the costs will stay out of the business. … Buffets are a great example. It’s hard to understand how buffets come back in the picture going forward in the environment we’re in today.”
The company has reopened all but three of its 29 properties; the Eastside Cannery, Main Street Station and Eldorado Casino in Southern Nevada have yet to reopen.
Smith said the reopenings will be based on demand, but there are “no dates right now.” He added that downtown Las Vegas — where Main Street Station is located — is not performing at the same level as Boyd’s other segments.
At this point, the company has about 19 months worth of liquidity in a zero-revenue environment.
By the numbers
Second-quarter revenue and earnings for Las Vegas-based Boyd Gaming Corp. (NYSE: BYD)
Q2 2020: $209.9 million
Q2 2019: $846.1 million
Q2 2020: ($108.5 million)
Q2 2019: $48.5 million
Earnings/(loss) per share
Q2 2020: ($0.96)
Q2 2019: $0.43