Golden Entertainment Inc., parent company of The Strat, Arizona Charlie’s and the PT’s Pub franchise, reported record first-quarter earnings, company executives said Thursday.
“Our record first-quarter results reflect a continuation of the strong financial performance we delivered over 2021,” said Blake Sartini, chairman and CEO of Golden. “Our strong cash flow has allowed us to reduce debt while returning capital to shareholders through our share repurchase program. Since the beginning of 2021 we have reduced indebtedness by $158 million and since December 2021 we have also repurchased more than $25 million of our common stock. We expect to remain focused on returning capital to shareholders as the strength in our business continues.”
Golden reported a 14.1 percent revenue increase over 2021’s first quarter. The company produced net income of $36.1 million, $1.12 a share, on revenue of $273.6 million for the quarter that ended March 31.
A year earlier, the company reported net revenue of $10.6 million, 35 cents a share, on revenue of $239.7 million.
Charles Protell, president, chief financial officer and treasurer of Golden, said the company’s second quarter has started out the way the first quarter left off. The company’s visitation profile has been similar to those of other casino operators — somewhat weak in January, as a result of the omicron variant of COVID-19 fears, followed by upticks in February and March. The usual CES convention crowd was not as abundant this year.
“Right now, we see no sign of a slowdown in any of our properties,” Sartini said.
Protell said the Strat is poised for cash flow growth and has been seeing occupancy of between 70 percent and 75 percent overall.
“We’re definitely punching above our weight,” he said.
While Golden’s Las Vegas assets remain strong, Chief Marketing Officer Brad Goldberg said there’s still room for growth in the market as international travel and midweek convention business returns.
In an interview with the Review-Journal, Goldberg said the Strat is a magnet with international appeal because of its prominent profile on Las Vegas Boulevard. And, while the Strat has no convention facilities of its own, the hotel is a draw to convention and trade show attendees because of its proximity to the Las Vegas Convention Center.
Goldberg also said Golden, the market leader in Laughlin, has seen solid performance there, mainly because of entertainment brought to the Laughlin Event Center during the spring season ahead of the hottest time of the year.
Golden officials say gaming revenue generally runs parallel to entertainment events at the 10,000-seat outdoor amphitheater. It has a smaller indoor entertainment venue at its Edgewater resort.
Goldberg said there are no plans at present to reopen its Colorado Belle resort on the Colorado River.
The 1,150-room hotel, modeled to look like a Mississippi River steamboat, was shuttered in March 2020 when Gov. Steve Sisolak ordered emergency closures of casinos to stop the spread of COVID-19. The property never reopened and was deemed permanently closed in August 2020.
“Golden posted first-quarter upside with revenues and adjusted cash flow that exceeded our and consensus estimates, despite the impact from omicron in January and February,” gaming analyst Omer Sander of New York-based J.P. Morgan said in a note to investors. “Management highlighted still strong customer trends across the portfolio, with no deterioration in consumer habits — spend nor visitation — a topic that remains front of mind for investors given the macro backdrop.”
Golden Entertainment shares, traded on the Nasdaq, fell $1.97, 4.1 percent, to $45.93 a share on volume less than nearly twice the daily average.
Golden Entertainment Inc.
First-quarter revenue and earnings for Las Vegas-based Golden Entertainment Inc., which operates The Strat and two Arizona Charlies properties in Las Vegas and properties in Laughlin, Pahrump and Flintstone, Maryland. (Nasdaq: GDEN)
1Q 2022: $273.6 million
1Q 2021: $239.7 million
1Q 2022: $36.1 million
1Q 2021: $10.6 million
Earnings per share
1Q 2022: $1.12
1Q 2021: $0.35