Author: David Mckee

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Sands sends the help; Atlantic City slips

While most companies who were presenting at the J.P. Morgan Gaming, Lodging, Restaurant & Leisure Management Access Forum sent their CEOs and CFOs, Las Vegas Sands couldn’t be bothered. It kicked the matter downstairs to Senior Vice President of Investor Relations Daniel Briggs. We can only presume that Rob Goldstein had a pressing tee time. After all, Sands had almost nothing but good news to present to Wall Street analysts. Leaving aside Goldstein’s discourtesy, you may be wondering if and when Sands is returning to the U.S. The answer would appear to be …

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Wall Street comes to Vegas; Trump wins?

Gaming executives showed the flag this week for the J.P. Morgan Gaming, Lodging, Restaurant & Leisure Management Access Forum, being held this week on the Las Vegas Strip. We’ve covered Caesars Entertainment and Boyd Gaming for CDC Gaming Reports, but will deal with a couple of the other majors here. MGM Resorts International sent CEO Bill Hornbuckle and CFO Jonathan Halkyard to impress the assembled investors and stock boffins. As summarized by Morgan’s Joseph Greff, Hornbuckle and Halkyard (henceforth H&H) said they didn’t see any consumer pullback on the Strip, although there had been some “modest degradation” in the lower price tiers. Excalibur, beware! So much the better that Marriott Hotels had arrived in force and its new alliance with MGM was showing “significant progress … performing well ahead of internal expectations.” Good for Marriott, good for MGM, not so good for online travel agencies, who stand to be displaced.

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Motown and more; Stiff of the Month

Since the Great Pandemic, gambling has never been quite the same for Detroit. Last month’s casino tally of $105 million was flat with 2023 and 9% down from the pre-pandemic pace of 2019, a recurrent theme in Motown. MotorCity beat the odds and posted a 1% increase, hitting $31.5 million for the month. Hollywood Greektown, which had been on a tear, was flat at $24 million, leaving $49 million (-1.5%) for MGM Grand Detroit. As J.P. Morgan analyst Joseph Greff reminds us, this includes a Leap Day, which probably kept Detroit’s casinos revenue-neutral for February.

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The many moods of Dan Lee

If people who contradict themselves contain multitudes, it must be very crowded inside Full House Resorts CEO Dan Lee. Make no mistake: Big Gaming needs a lot more CEOs like him. He’s down to earth and a straight shooter. But Full House’s latest earnings call could have given you whiplash, given some of Lee’s back-and-forth comments about new resort Chamonix, in Cripple Creek, Colorado. One minute he was praising the property, the other making excuses for it. Some of this was understandable, seeing as the opening was botched, coming off a rough start for The Temporary at American Place, in Waukegan (birthplace of Jack Benny), which also had Full House going into spin-doctoring overdrive.

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A’s: Pretty pictures and B.S.; Glebocki’s back

Onward goes the fan dance that is the Oakland Athletics‘ long-running tease of the Las Vegas Strip. After spending months tantalizing Clark County officials with promises of a new stadium design, A’s brass finally dropped a veil in the form of a set of project renderings for a gull-winged ballpark that looks suspiciously like the Sydney Opera House. More of that anon. What’s of more interest to us is the sleight of hand being performed by A’s owner John Fisher to make this change be mistaken for progress. It’s becoming questionable whether Fisher has two nickels to rub together, as he’s been elaborately silent on whether he can pick up the $1.5 billion tab for the vanity park. A credible financing package would be more impressive than all the renderings in the world but we’re no closer to that. It gets worse …

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Oscar odds and fearless forecast

Thanks to the epic throwdown between Greta Gerwig‘s Barbie and Christopher Nolan‘s Oppenheimer, bettors are out in force in seven states as the Academy Awards derby comes down to the wire. Bookies.com analyst Bill Speros bluntly told Reuters, “You have two movies that everybody’s seen.” FanDuel is even taking prop bets (color of dresses, etc.) in Canada. At the moment, though, it looks like Oppenheimer will virtually run the table while Barbie is struggling to not get shut out. Virtually the only significant suspense is whether Emma Stone (Poor Things, +125) pulls a narrow upset over Lily Gladstone for Best Actress, thereby validating the National Board of Review jinx. Meanwhile, Barbie is a lock for nothing except Best Original Song. Since the odds are pretty consistent at this point, we’ll go with Covers.com‘s set (plus some averaging by ourselves) and take it away …

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Golden gleams; Trump’s casinos revisited

What might have been a disappointing quarter for Golden Entertainment was redeemed in Wall Street‘s eyes by the initiation of stock dividends. Golden will be paying $0.25/share on a quarterly basis. This has been made possible by the wholly laudable reduction of the company’s debt to 2X cash flow. “We believe the decision to institute a dividend, more so than the dividend itself, speaks to the optionality and flexibility of the Company at this stage,” applauded Deutsche Bank boffin Carlo Santarelli.

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Dip on the Strip

Contrary to Wall Street’s expectations, gambling revenues on the Las Vegas Strip dropped 4% last month. The $686 million haul was depressed by 4.5% lower coin-in at the slots, despite tight hold (9%). Table games fared even worse, with a -17% trend in wagering (baccarat excluded) driving a -20% plunge in casino winnings. Baccarat play plummeted 31.5% but luck was with the house, which saw only a 7.5% decline in win. Contrarily, locals-casinos blossomed, their revenue up 4.5%, propelled by Durango Resort, which continues to do boffo business. Slot revenue of $239.5 million was up 5.5% while table win ($46 million) was flat. Compared to the once-halcyon days of 2019, the Strip was up 29% and locals joints were 31% higher. The January numbers may be somewhat misleading, as end-of-December slot winnings got rolled into the next month (due to a Nevada reporting oddity); making locals numbers look even better and Strip ones marginally less worse.

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This & that

There was a rumble in Manhattan on the 22nd. Proponents and foes of New York City casino descended upon a town hall to duke it out. In this corner, opposed to casinos is state Sen. Liz Krueger. In the other, favoring a megaresort is state Sen. Brad Hoylman-Sigal. “We do need to center the community and insure community members have the opportunity to have their voices heard,” said the latter, adding, “I’m going to be using my involvement with the community advisory committee … to do just that: insure that the proposals—and there are two of them in my district on the west side of Manhattan—are first and foremost beneficial to and desired by the community around it.”

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Caesars on ice; Bally’s “respectable”

Managing expectations was the order of the day for Caesars Entertainment, which had guided Wall Street to expect cash flow of $930 million. That included a 5% revenue disappointment on the Las Vegas Strip, despite 98% occupancy. The quarter could have been better were it not for salary increases (we thought the company had made provision for that; it certainly said it had), construction-related disruptions in New Orleans and Indiana, the loss of 65,000 room nights at the Versailles Tower of Paris-Las Vegas and Colosseum Tower at Caesars Palace, and adverse sports betting hold as punters did well. Caesars execs warned stock boffins not to anticipate too much from 1Q24, saying January was “a debacle” thanks to dreadful weather. In the same breath they said, no matter, it’s “a seasonally slow month.” So which is it?

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