Golden Entertainment’s first-quarter results suffered from the comparison to the 2024 Super Bowl in Las Vegas, but the casino operator is off to a good start in the second quarter.
President Charles Protell said the decline in revenue and adjusted earnings for the first-quarter results were “in line with our expectations and primarily impacted by not having the Super Bowl in Las Vegas, which was mainly felt at The Strat.”
Outside of the Super Bowl impact on The Strat, the business during the first quarter was “healthy,” Protell said. The company’s adjusted earnings from other casinos was up, while those at its taverns was stabilizing. “As we look forward, April continues to demonstrate stable operating trends and May is off to a strong start.”
Currently, no “dislocation in our business” seems to be reflected in the company’s public valuation, Protell said.
During the first quarter, The Strat had declining occupancy and spending primarily in February promoting a $3 million headwind in adjusted earnings, Protell said. Occupancy was down 5% for the quarter and down 13% in February, which in turn led to lower gaming, food, and beverage revenue.
In April, the Strat benefited from higher occupancy and rates driving improved adjusted earnings in the second quarter, Protell said. Bookings through May show Strat occupancy is up 6% over last year at attractive room rates. June is showing strength as well, Protell said.
In Laughlin, the operator increased adjusted earnings by reducing expenses and focusing on more profitable concerts at their smaller entertainment venue, Protell said. They also targeted weekend promotions for drive-in customers and midweek bingo for local residents that allowed them to maintain a leading market share.
For Las Vegas’s two Arizona Charlie’s locals casinos, revenue was flat, with adjusted earnings of 2% driven by operational efficiency, Protell said.
“We see consistent performance out of our locals casinos, with EBITDA margins at 46% for the second straight quarter,” Protell said. “We’re even seeing increasing strength in our local-based casinos, so this segment is off to a strong start in the second quarter.”
In Golden’s taverns, revenue and EBITDA were down slightly year-over-year, but on a sequential basis have increased over the fourth quarter, thanks to their newest taverns at lowered operating expenses.
Protell said Golden’s business overall has remained resilient and is improving despite an uncertain economic environment. Owning their taverns and land gives them the potential to withstand any short-term fluctuations in consumer demand and benefit from long-term economic trends in Nevada.
CEO Blake Sartini said that without traditional banquet space, their window of looking at long-term bookings is shorter than other operators. It’s hard to predict beyond June, but casino revenue and operating margins are tending in the right direction at The Strat.
Sartini said Las Vegas consumers aren’t feeling the stock market decline, but are more affected by mortgage rates and higher prices. He said there are trends they are playing a similar amount of gaming days, but have less investment, “so there’s been a pull back a little bit.”
