Boyd Gaming is coming off a strong third quarter and hopes the upswing will continue well into the future. Bit hard by the COVID-19 pandemic, which caused the casino operator to lay off 25% of its workforce and issue $800 million in bonds, the company believes the worst is behind it. Following Q3’s record-setting performance, Boyd is willing to buy back $300 million in shares to usher in a stronger 2022.
Boyd Continues Growth
According to Boyd’s latest financial health report, the operator saw record revenue in the third quarter. Its adjusted earnings improved by over 42% and adjusted margins after corporate expenses climbed 40.4%. In Q3 of last year, the adjusted margins were 36.6%. 21 of the company’s 26 properties across the US saw double-digit year-on-year gains, and 18 of them set new property records for the quarter.
In Las Vegas, Boyd’s revenue increased by 35% compared to last year, with adjusted earnings growing by nearly 60%. Downtown Las Vegas saw the most impressive growth, with adjusted earnings on margins closing at 31% growth. According to the company’s report from yesterday, that marks a double-digit improvement over what had been reported for Q3 of 2019. Elsewhere in the country, the company saw 22% year-on-year earnings growth and 42% growth compared to two years earlier.
Improved Performance Brings Improved Stability
With strong results for Q3, Boyd is ready to start spending more money. It said that it will “increase expenses” over time and that new marketing initiatives are on the horizon. It added that it will expand its workforce complement over time, as well, filling some of the 25% that was let go in July of last year. In addition, the company wants to buy back up to $300 million in stock that has been issued; however, it didn’t lay out a plan or schedule for the repurchase.
Boyd President and CEO Keith Smith asserted in the report, “As the labor market recovers and we’re able to rent all of our hotel rooms and open more of our amenities, we believe there are more revenue opportunities.” He added, “In downtown Las Vegas, we anticipate continued growth as tourism throughout the city recovers and Hawaiian visitation improves. We also have opportunities for future growth in our midweek business and meeting and convention business.”
iGaming, Sports Betting to Propel Further Growth
Boyd already has an established presence in the online gambling space, offering both iGaming and online sports betting in some areas. These two segments will continue to boost the company’s revenue, with Pennsylvania and New Jersey iGaming already “off to a good start.” Partnered with FanDuel, Boyd expects to increase its coverage in the US as the sports betting operator extends its reach, with a lot of attention currently being given to Louisiana.
The inclusion of Louisiana is expected to give Boyd a considerable injection of revenue. According to Smith, “Once live, this will expand our partnership with FanDuel to six of our nine regional states. In all, we expect our digital operations, including sports, casino, and social casino, will generate more than $20 million in (adjusted earnings) this calendar year.”