Boyd Gaming reported a full-year record for revenue and adjusted earnings, the third consecutive year the company broke its own record. Fourth-quarter earnings, however, were reduced, partly due to the opening of Red Rock Resorts’s Durango Casino & Resort in southwest Las Vegas.
For 2023, Boyd Gaming reported revenue of $3.7 billion, up from $3.6 billion for 2022. Total adjusted EBITDAR for 2023 was $1.4 billion, up slightly from the prior year, the company announced in an earnings call Thursday with Wall Street analysts.
Boyd’s online segment benefited from the introduction of sports betting in Ohio in January 2023. Revenue and adjusted EBITDAR growth was also driven by strong results at Sky River Casino in Elk Grove, California. Boyd expects $60 million to $65 million in EBITDAR for its online segment in 2024, as no new markets are expected to come online.
Boyd also reported fourth-quarter revenue of $954.4 million, increasing 3% from $922.9 million in the fourth quarter of 2022, aided by growth in its online segment. Total adjusted EBITDAR was $355.5 million in the fourth quarter of 2023 versus $360.1 million in a record fourth quarter of 2022.
During the fourth quarter, year-over-year revenue and adjusted EBITDAR in the Las Vegas locals segment were consistent with each of the last two quarters, executives said. Downtown Las Vegas delivered fourth-quarter revenue growth, while adjusted EBITDAR equaled last year’s record fourth quarter, with “particularly strong” results at the recently expanded Fremont Hotel & Casino, which performed at record levels.
The Midwest and South returned to growth during the fourth quarter, as both revenue and adjusted EBITDAR increased over the same period in 2022. Operating margins were more than 38%. Gaming revenue was even with the fourth quarter of 2022 and the strongest in 2023. Food and beverage revenue rose 4%.
“Play from our core customers grew at the strongest rate of the year,” said Keith Smith, president and CEO of Boyd Gaming. “While this growth was offset by lower retail play, the year-over-year decline in retail play was the smallest we’ve seen since the first quarter of 2023. Non-gaming revenue continued to grow 1.5% over the prior year.”
Property-level margins for Q4 exceeded 40%, which Smith said is in line with what they’ve delivered over the last three years.
In the Las Vegas locals segment, revenue and EBITDAR during the fourth quarter were in line with expectations and play from core customers grew at a rate similar to the third quarter. Retail play was also consistent with third-quarter levels. Hotel revenue rose 4% during the fourth quarter and overall margins exceeded 50%, Smith said.
“Looking ahead at 2024 in our locals segment, remember we produced a record first quarter last year, so we’re facing tougher year-over-year comparisons,” Smith said. “We also expect to see some impact from the recent opening of a new competitor in the Las Vegas locals market and a room remodel project at the Gold Coast Hotel. We’re encouraged that customer trends in the Las Vegas locals segment are holding steady so far in the first quarter, with overall play volumes looking similar to fourth- quarter levels through early February.”
Josh Hirsberg, executive vice president and CFO, said it’s too early to gauge the impact from the opening of its newest competitor in Durango. “We have to see how that plays out.”
Boyd’s downtown Las Vegas segment is poised for “healthy growth” in 2024. The optimism is based on the strength of the southern Nevada economy. “For the Super Bowl this weekend, we’re experiencing strong demand in the cash hotel business at our locals and downtown properties,” Smith said.
As for the Midwest and South segments, they’ve been impacted by bad weather so far in 2024, but customer trends in the last two weeks have rebounded to fourth- quarter levels, Smith said.
Boyd Gaming paid a quarterly cash dividend of $0.16 per share on January 15, 2024.
