Boyd Gaming Reports Second Quarter Results
LAS VEGAS, Aug. 5 /PRNewswire-FirstCall/ -- Boyd Gaming Corporation (NYSE: BYD) today reported financial results for the second quarter ended June 30, 2009.
(Logo: http://www.newscom.com/cgi-bin/prnh/20030219/BOYDLOGO)
For the quarter, we reported net income of $12.8 million, or $0.15 per share, compared to net income of $21.7 million, or $0.25 per share, in the same period last year. Certain pre-tax items resulted in a net increase in income of $3.6 million ($2.3 million, net of tax, or $0.03 per share) during the second quarter 2009. By comparison, the second quarter 2008 included certain pre-tax items that had a net effect of reducing income by $7.6 million ($4.8 million, net of tax, or $0.05 per share). Pre-tax items in the second quarter 2009 and 2008 are listed in a table at the end of this press release.
Adjusted Earnings(1) for the second quarter 2009 were $10.4 million, or $0.12 per share, compared to $26.4 million, or $0.30 per share, for the same period in 2008.
Net revenues were $423.0 million for the second quarter 2009, compared to $460.8 million for the same quarter in 2008, a decrease of 8.2%. Total Adjusted EBITDA was $105.6 million for the quarter, a decrease of 11.7% from $119.6 million in the prior year.
Keith Smith, President and Chief Executive Officer of Boyd Gaming, commented on the quarter, "While business conditions remained difficult in each of our regions, our results were in line with our expectations. The uncertainty which exists in the economy today continues to negatively impact consumer spending. Despite this, we believe the precipitous declines that began in the second half of 2008 are over, as we continue to see stabilization in our business. We remain confident in the resilience of our business model and our ability to manage the Company through these challenging times."
Smith added, "The recent bankruptcy filing by Station Casinos highlights the difficulties this recession has created for some businesses. Having said that, we remain confident in the long-term viability of the Las Vegas market, and we continue to be interested in acquiring some or all of Station's assets."
(1) See footnotes at the end of the release for additional information relative to non-GAAP financial measures.
Year-To-Date Results
We reported a net loss for the six months ended June 30, 2009 of $1.1 million, or $0.01 per share. By comparison, we reported a loss of $10.9 million, or $0.12 per share for the six months ended June 30, 2008. The net losses were due in part to non-cash, pre-tax impairment charges related to Dania Jai-Alai of $28.4 million and $84.0 million during the six months ended June 30, 2009 and June 30, 2008, respectively.
Adjusted Earnings for the six months ended June 30, 2009 were $23.4 million, or $0.27 per share, as compared to $63.4 million, or $0.72 per share for the six-month period in 2008.
Net revenues were $857.8 million and $931.9 million for the six months ended June 30, 2009 and 2008, respectively. Total Adjusted EBITDA was $215.2 million for the current six-month period. By comparison, total Adjusted EBITDA for the 2008 period was $247.3 million.
Key Operations Review
Las Vegas Locals
In our Las Vegas Locals segment, second quarter 2009 net revenues were $166.1 million versus $197.9 million for the second quarter 2008. Second quarter 2009 Adjusted EBITDA was $43.9 million, a 29.7% decrease from the $62.4 million in the same quarter 2008. Reduced consumer spending and continued pressure on room rates impacted results.
Downtown
Our Downtown Las Vegas properties generated net revenues of $57.6 million and Adjusted EBITDA of $11.8 million for the second quarter 2009, versus $63.0 million and $10.3 million, respectively, for the second quarter 2008. Improved property operating margins, as well as lower fuel costs at our Hawaiian charter operations, contributed to increased Adjusted EBITDA in the region.
Midwest and South
In our Midwest and South region, we recorded $199.2 million in net revenues for the second quarter 2009, compared to $199.9 million for the same period in 2008. Adjusted EBITDA for the current period was $44.3 million, a decrease of 2.4% from the $45.3 million reported in the second quarter of 2008. The consistent results were principally due to higher than normal operating costs associated with integrating our new hotel at Blue Chip, offset by strength at our Delta Downs and Par-A-Dice properties.
Borgata
Net revenues for Borgata were $191.5 million for the second quarter 2009, compared to $205.1 million recorded in the same quarter in 2008. Despite the decline in net revenue, operating income for the second quarter 2009 increased to $27.3 million, versus $22.3 million for the second quarter 2008. Adjusted EBITDA also increased to $47.7 million, up from $45.2 million for the second quarter 2008. While Borgata's net revenues were adversely impacted by both the recession and an increasingly competitive regional environment, cost-control measures implemented over the last year drove increases in operating income and Adjusted EBITDA. In addition, the property continued to outperform the Atlantic City market, boosting its leading market share by more than two percentage points versus the year-ago quarter.
Paul Chakmak, Executive Vice President and Chief Operating Officer of Boyd Gaming, said, "Although conditions in the Las Vegas Locals market remained challenged, the rate of decline was consistent with the first quarter, and margins were stable. In our Midwest and South region, innovative marketing efforts and more efficient operations contributed to consistent results compared to the same period last year. And in Downtown Las Vegas and Atlantic City, cost-containment measures helped us post EBITDA growth in declining markets. These results demonstrate the success of the more efficient business model we've created while maintaining the exceptional service our customers have come to expect from Boyd Gaming."
Key Financial Statistics
The following is additional information as of and for the three months ended June 30, 2009:
-- June 30 debt balance: $2.69 billion
-- June 30 cash: $93.6 million
-- Maintenance capital expenditures during the quarter: $12.1 million
-- Echelon expansion capital expenditures during the quarter: $9.4 million
-- June 30 debt balance at Borgata: $666.8 million
Conference Call Information
We will host our second quarter 2009 conference call today, August 5, at 12:00 p.m. Eastern. The conference call number is 888.679.8040 and the passcode is 80231597. Please call up to 15 minutes in advance to ensure you are connected prior to the start of the call.
The conference call will also be available live on the Internet at www.boydgaming.com or http://phx.corporate-ir.net/...etails&c=95703&eventID=2305917
Pre-registrants will be issued a pin number to use when dialing into the live call, which will provide quick access to the conference by skipping the operator sequence upon connection.
Following the call's completion, a replay will be available by dialing 888.286.8010 today, August 5, beginning two hours after the completion of the call and continuing through Thursday, August 13. The passcode for the replay will be 64540189. The replay will also be available on the Internet at www.boydgaming.com.
The following table presents Net Revenues and Adjusted EBITDA by operating segment and reconciles Adjusted EBITDA to net income (loss) for the three and six months ended June 30, 2009 and 2008. Note that in the Company's periodic reports filed with the Securities and Exchange Commission, the results from Dania Jai-Alai and corporate expense are classified as part of total other operating costs and expenses and are not included in Reportable Segment Adjusted EBITDA.
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