Boyd Gaming’s first-quarter earnings report was somewhat gloomy, but casinos in Missouri were bright spots for the company in the first three months of 2024.
It’s tough for any company to repeat it successes following a record year, as Boyd is finding out. However, Boyd Gaming President and CEO Keith Smith said he was “encouraged” at the company’s trajectory moving forward.
“As we look ahead, we are encouraged by the improving customer trends over the last several quarters. And those trends have continued across our Midwest and South segment in April.”
Smith talks about renovations at St. Charles casino
Boyd Gaming operates two of the 13 riverboat casinos in Missouri: Ameristar Casino Hotel Kansas City and Ameristar Casino Resort Spa St. Charles. Missouri online casinos remain illegal, while efforts are underway for residents to vote on legalizing sports betting in November.
The current renovations at the St. Charles Ameristar came up in the earnings call this week. Smith said Boyd is also upgrading two of its other properties.
“We are also refreshing and updating our hotel product. Currently, we are renovating rooms at Gold Coast, Ameristar St. Charles and Blue Chip. And we are set to begin similar projects at the Orleans IP and Valley Forge later this year.”
The Boyd casinos in Missouri are two of the largest gambling destinations in the state.
Ameristar Kansas City boasts a 140,000-square-foot casino floor, more than 2,200 slot machines and 80 table games. High-limit gaming is available, too, as players can bet up to $10,000 on select games. The casino also offers a baccarat pit.
Ameristar St. Charles, located roughly 30 minutes northwest of St. Louis, has 130,000 square feet of gaming space. Between its slot machines and table games, there are more than 2,000 options for its customers. Ameristar St. Charles also features a hotel with 400 suites, five restaurants, and a luxurious spa encompassing 7,000 square feet.
Revenue down about $3M from 2023
In the first quarter of 2023, Boyd Gaming posted revenue totals just under $964 million. During the same timeframe this year, the company came up short roughly $3 million, clocking in around $961 million.
Following the earnings call, Boyd Gaming’s stock dropped 15%.
Again, the company is competing against a record year in 2023. On the plus side, Smith highlighted the company’s “nongaming revenue.”
“We also saw growth elsewhere in the business. Adjusting for rooms out of service related to a hotel renovation project at our Ameristar St. Charles property, nongaming revenues grew 4% in February and March.”
Severe winter weather one reason for slow start, Smith says
During the earnings call, Smith noted a few reasons why revenue could be down last quarter compared to a year ago.
He pointed to the severe weather that has affected the company’s Midwest and Southern casinos. Once the storms passed, Smith said a sense of optimism returned.
“While results were down year over year, this was primarily due to severe winter weather impacting January. Beyond January, gaming volumes from our core customers grew, continuing the trends from the fourth quarter. And retail play in February and March was also encouraging, coming in nearly flat to the prior year, the best year-over-year performance we have seen in almost two years.”
Josh Hirsberg, Boyd Gaming’s executive vice president and CFO, elaborated later in the call regarding the weather in January.
“When you look at the quarter for the Midwest and South, it’s all about weather, and it’s all about January. I mean January was essentially wiped out because of the weather influence … We can look at February and March of this year. I understand it’s two thirds of the quarter, but January was essentially affected significantly by weather. And you look at February and March of last year and say what was going on. Margins in February and March of this year were 39%; margins last year in February and March were 40%.”
