Question of the Day - 14 November 2023

Well, we agree that the first impulse for companies like Station Casinos when presenting a delay or problem or newsworthy issue to the public is to dissemble and spin. This inclination is almost instinctive for public companies, especially those with a lot of highly paid PR departments and outside media companies and consultants, when they have to reframe an issue or event to reduce any negative impact it might have on public opinion.

Though it's often hard to believe that anyone with a modicum of intelligence would fall for the most obvious kinds of corporate poppycock (remember Wells Fargo's lame excuses over getting caught creating fake customer accounts, unilaterally modifying mortgages, and charging auto-loan customers for insurance they didn’t need, for which the bank was subsequently fined billions of dollars?), there is, we note, a sucker born every minute.

That said, it's actually conceivable that Durango employees won't be ready on November 20.

There's been a lot of competition for workers lately, with Sphere opening, Fontainebleau needing 6,500 (and hiring only 1,800 so far, last we heard), F1 scooping up temps, lots of new restaurants showing up, and casino job fairs a common occurrence hereabouts. If Station is having some trouble filling Durango positions, especially since the company is spending upwards of $800 million on its 200-room hotel, it's not hard to believe that onboarding and training might be behind schedule.

Also, if construction is the culprit, it's easy enough to blame the contractors. Which, in fact, Station did, at least to a certain extent.

"Different areas critical to the opening were not turned over by contractors in the time we originally anticipated," Lorenzo Fertitta said on the company's recent third-quarter earnings call. He further explained, "Our operations are a little different from the Strip, in that we’re primarily a locals’ property. We’re going to have a lot of repeat customers. This isn’t where you’re going to see a new face every day."

And it might seem like he laid it on a little thick when he added, "The level of service on the day we open must be at the highest quality it can be. It’s the right thing to do when the doors open to be totally ready. We’re going to own this asset for a long time and the first impression is very important. We have very high standards and want to make sure we nail the opening.” 

But that's not too far from the reality, either. Locals casinos do need to concentrate on superb service with a smile, since as Fertitta says, these are all return customers. And he should know. Palace Station was the first true locals casino and Station has been in that business ever since.

What do you think? Is this the rare occasion that the spin actually matches up with reality? Is Durango delayed a couple of weeks due to employee-training issues? Or is it something else? And if it's something else, what might it be?