BYD - Earnings call transcript Q3 2020 | Boyd Gaming Corporation

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Operator

Good afternoon. And welcome to the Boyd Gaming Third Quarter 2020 Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. to President, conference Treasurer. Chief like Hirsberg, to now Vice Executive Financial would turn over the Josh I Officer and go ahead. Please

Josh Hirsberg

third Thank welcome afternoon, Good quarter our you, conference everyone, call. Gary. to and

and the on is our this Joining Chief me Officer. call Executive Keith afternoon Smith, President

Private may results in and today any statements impact Actual or our to with materially as today’s from date the comments undertake comments Reform no are statements. Act. risks update in forward-looking the that including our filings differ forward-looking statements those projected in that forward-looking are certain may revise the Our Litigation SEC our are All we There obligation statement. will within include results. those Securities forward-looking statements of and uncertainties, disclosed

make non-GAAP we measures. During financial today, our call reference to will

financial available non-GAAP the Relations call webcast measures the after is call. section at our this being to will which For earnings furnished a to to the and refer project our to complete Form non-GAAP website provide Investors forward-looking X-K at in special our expenses. of charges also of reconciliation We historical live available and website shortly boydgaming.com Today’s for reconciliation inability measures, today replay do to and a boydgaming.com. GAAP be please financial not certain section of of are press SEC in due our and the release of our Investor completion both of

to So, Smith. with that, I to call now would Keith the like Keith? turn over

Keith Smith

you Thanks, Josh. us afternoon, for today. joining Thank everyone. Good

teams the by key changes the months factor a of began adapt to the since ago country. success. reopening five our been pandemic Their tremendous properties the significant Our progress across third ability operating has we we reflect strength about quarter and our in the brought COVID made results our clearly to have

challenge, Same our ensuring control guests to without us. new great meet guest casino to a the our marketing process down limited it. clear much and that With on reality, a expect at cost discussed had members. changed develop we we implement from experience safety Successfully with we to on a a business environment world We time aimed our The to operating we safe reduced for May, to adapt had needed started throughout developing protocols compromising rebalance environment. sanitation customers and and in last had and team entirely we our operating for we from match amenities and and this was was the one world. this has executing of of when course late strategy a properties well our I we to knew challenges am reopening operating and this we extremely way teams change over have guests, pre-COVID our outstanding ever As visitation call, have was months it to respond capacity a and just results they have few faced. our greatest significantly of cost our the needed to the proud floors our as to find produced. to different strategy as our

XX%, companywide highest margins full companywide operating reopening, operating than This During nearly to history. increased our first is is margin quarter basis up X,XXX our since in EBITDA the a more XX.X%. points as

from for EBITDAR Hurricane lost properties Delta incredibly which including set and of double-digit XX our the to our record damage records of record a produced EBITDAR all-time Eight more During weeks quarter. the of achieved and third quarter, business quarter, in three Laura third still grew at for the a pace. due properties three quarters fourth Downs,

declines Orleans, Vegas less during region. targeted the increased to tier high quarter to be Louisiana than segment for were the a XX% business The and driving quarterly we almost results The our XX% the Downtown Vegas in market. EBITDAR EBITDAR strong repeated gaming were Vegas significant rose targeted resulted best that our Las achieved Mississippi XX revenues closures nearly record. as hurricanes. X,XXX in declines play despite of from was Overall, and the and to points overall segment’s customers. This counts guest with destination company-wide EBITDAR quarterly to third exception continues marketing EBITDAR basis nearly While business, the our in of our revenues and were as approach our years. one stronger history. down as to by margins strongest segment. is Las more to properties travel Locals the top we impacted down, in X,XXX performance X%, Midwest margins are nearly quarter, even XX%, XX%, segment a segment, On in across new up Local which an due basis delivered even was The all-time performance basis, South quarter our points in growth than this EBITDAR convention rose more broad-based approach in Las

we and our However, performance Orleans Downtown Hawaii, we way trends close properties, who there’s no able on of properties, been conditions October, XX% near by been to which to in go our The were have strong as The our a has restrictions been travel more improve in Well, month. our operating costs from significant our in for easing last But a as record Orleans’ things today under travel reduced marketing Downtown be some make Hawaii. into successfully particularly And There to the premium that with compete of from will drive expect play be be kept where to three The have shutdown will there total normalize, have year’s affected weeks Las to normal. doubt there at an at back impact back results now from remained coming Vegas operating continued our play and first performance. reopened people of Locals New South normal. third add our to and visitation business and remarkably Downtown some regional situations buildings of begin our in pressure will With customers. our nationwide to it from costs. marketing a may live to look within our stable segment and Midwest visitation this in of the and pressure since compared quarter just more only the than property way overall, of into positive execute casual of EBITDAR, back our has to total distance strategy customers current for to new over our level driving sense the to properties. portion But, mind today, X% more we our our we business Downtown been the Vegas represents add accounted XXXX, XX% to keep future. and In to overhead modest business return It segment. Overall, to Locals built XX% for the from business. Las that, is important is to

have again. grow there customers the felt higher more focused customer we strength and going encouraged We to months enough business margins to forward. are venture yet once comfortable opportunities out, in visiting have and we past segments, determined as more properties who And believe available ample a efficient established while confident our these we loyal not sustain most future, us and are model over several to in are our by also that

properties. partnership traditional presence. our are Just both implementing expanding of continued operating a are the digital and also the outside engage A and are our example is business, technology entertainment convergence with inside our customers new way of a Through new opportunities of traditional experience, we of successfully to as casino the we we digital creating our FanDuel. expansion good

In of across FanDuel are country. X% FanDuel FanDuel sports properties betters our Group, the addition equity our in millions ownership with to the partnership increasingly to our market to we leveraging

to home. are growing customers, We FanDuel of the in the ability comfort segment business offer participate also our with of partnering our from to a

added betting and the quarter, products Boyd mobile Illinois FanDuel During Gaming in sports and Iowa. third

With Connected traditional sports digital the together Connected use base wagers In ability new of casino amenities and envision experience accounts experience. universe traditional we fully hotel us table online our country. money of smartphones July sports launch all a we five to Stardust in online experiences allow casino launched Nevada the in brands in seamlessly single wager our become B use Mobile, make and Mobile a the our social B casino XX into be wallet our with states Technologies, this that are Stardust digital to They adults these for bets, frictionless use planning online, the with of our Stardust Sports, in sports Connected to our Casino entertainment at the to properties. give the and launch our their space growing digital cash be Mobile mobile portfolio app. between coming Social FanDuel, customer hub our within presence to strategy properties to rooms, on B product to latest and in million cash offer and plan months. digital to access customers brands the digital with Connected we partnership transferable we Mobile, our and our points September. out digital and expand games. make future, Casino Through Developed Consistent gaming restaurants, of our and their our across the the pay casinos of now encompassing to our was Aristocrat further on B Connected will other B integrate and casino iGaming we including with and offering into tying guest’s betting digital credits app to own an within initiative slot purchase or real able and machines they of our Social mobile launches, mobile will to will betting able wallet mobile growing this to

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when pieces This project We first-in-class a ahead putting resort the the allow with move -- Tribe market several south in it opens major final is months a of and the situated Sacramento are in in just of financing lucrative to XXXX. construction. strategically California next a highway share and capture of ideally be the secure significant half located gaming project to doors the and second its on will the place Northern have to

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company success, part of Gaming look important Boyd to healthy our instilled XX investing helped From an communities future, years commitment that Sam of communities our they thrive. others. serve. day believe create the we and our success to By we we we As founded and with the our health we well-being and continued the when the our ago. in Boyd communities in thrive, sharing Bill communities, to a

helping to to challenges XXXX. firmly advance continue these committed communities remained this throughout respond our last philosophy to have today, the of we years XX this philosophy We and

our assist provide Cross. need. been here contributions To Girls Food of Las late impacted Following of To & are providing Louisiana K-XX with relief like the Hurricane Vegas, community as our Nevada as students. who hit their Red are in We to by schools in to remote Southern partnership expanding we have community with support deals financial learning those remote cash provided mission and August, are Bora Boys providing challenges And declines members. to we in we funding the children in-kind created the well residents the with closed, travel organizations providing the hard assisted Bank, to Local assist with while Square Nevada helping to support learning we Southern significant team COVID our impact actively low American it to broader our in assistance to by of Three facilities to Louisiana are Nevada, hometown pandemic. Club help income financially long-term donations

communities, we strengthening company, we will turn Thank track continue today. investing are our keep I despite will shareholder future now As Josh? the call for growth, to new success. our proud in the time keep to Josh. of a and challenges as value over ability of this our record creating foundation long we for your you

Josh Hirsberg

Keith. Thanks,

we to to reopening engineered today, comes behavior operating business has drive our Since As properties, word execute amazingly customer’s is that think the been our well strategy an as enhanced consistency. profitability, our about mind one to as own ability consistent. our

Going of has captured since forward, much the been we retain our in performance reopening. efficiency expect to that operational

customers serving expenses We best highly reduced our in marketing. are focused operating on and targeted environment an of

expense Now to turning than and being result as of we quarter, the our closed properties were a corporate taxes transitioning expected higher to reopen. from

spending million. bringing corporate the million, quarter to up to quarter for levels run rate for third are periods to levels. year-to-date Capital amounts was fourth during expense catch items $XXX as not similar were include We however approximately $XX be corporate expect quarter XXXX the These closed. good we expense these

spend during be We Downs, expect are the repairs related which Delta $XX to fourth from insurance investments about to expected the at to excluding million proceeds. quarter, reimbursed

used the balances cash portion During of quarter, repay drawn we facility. our to a credit our fully

As we executing facility. we September and Their quarter our operating our for Term the After had of facility more the performance $XXX quarter now the align in million than to a of tremendous and $X A our our we work end availability with of Loan Loan third borrowings, our these cash B our extended undrawn hard the delivered XXXX all, commitments strategy reopened result end, of have company’s In under at million such credit billion. done the resulted we since that a of maturity Term in quarter. credit properties. exceeds and job approximately our reducing $XXX teams maturities availability increased we revolver on completely

present and take changing. profitable trend there now Just exciting remarks any is while as continues operating Gary call. to we on of sustaining the QX model our and the the into from of to risks these will our are are and that concludes challenges certainly there efficient committed questions themselves, no October we sign participants are future. results that and ready more

Operator

[Operator Greff Instructions] Our Joe comes JPMorgan. from go Please with first question ahead.

Joe Greff

guys. afternoon, Good

Keith Smith

morning. Good

Joe Greff

of what like to the of results. this gaming the about on and between am gains, retail kind mix segment Congrats get Josh think non-rated the I regions? And reverses about am to margin non-rated database can just Keith, recovery the to rated that recovery the negative the crux than sort segment, some margin is and you to the the you that the stronger is, and what player mix talk really players of and in in how South Locals extent recovery a database the to that? of and the Midwest rate with trying then ahead extent that I the is -- so and rated I’d and of looking what go do

Keith Smith

comments, of couple a So Joe.

customers is are worth and customers. play Those a play year-over-year. as I bit upper tier in less play significantly. the because cases and strong our as actually of little our continue think little from growing some see play look percentage so segments a we to database, at it up from than we actually Unrated overall, just not shifted our bit, a declined it that’s rated higher total

I customers coming as we so be, come I us out who momentum in And come deal out there business. look as and of yet in still remarks, to positive the out upside said there’s a in my we prepared visit forward, good think, the think I think will continues not as future comfortable have to

Josh Hirsberg

comments whether been their kind that going share. think, and in of rated what and on and has so we in as reopened said certainly have equally not in the add segment we to only since the seen proportionate our we consistent strong and trends the been our Joe, in -- they accurate unrated reopened. have very we There are really segments would both the is, The segment have Yeah. been I since business contributing business it’s Keith’s remarks, reflect or that, thing I really has changed,

is think the I point.

or in that degradation going affected one would have we over have or any unemployment segment seen really would folks one perhaps logically thought other. of other not the a away time benefits it’s pass changes the as through segment have result as whether We other

I we of segment. certainly the in are think that largely know customers they segments these perspective before and the and at rated the the historically have similarly seen well from levels are playing that unrated and have

Joe Greff

you South, follow-up as you couldn’t quantify then XQ? in And just the and the results tell Midwest Excellent. by Great. can the EBITDA hurricane looking in but a actually impact at

Keith Smith

year you we it we look hurricane to say on. Josh? last Hang had and impact When at quantified what it also was. haven’t QX Yeah. some

Josh Hirsberg

Yeah. Yeah.

So, last and this $X this and a million more And hurricanes of had we us Keith for kind impact. obviously so impacted year is kind that correct. an to But impact million year We year. of comparable worse was $X mitigated significantly. estimate

Joe Greff

Okay. guys. very Thank you much,

Keith Smith

Yeah.

Operator

is next go Santarelli The Carlo Bank. from with ahead. Deutsche question Please

Carlo Santarelli

my kind taking higher seen have question. commentary for higher Thanks mentioned the that worth in and the guys. -- over a that Keith, end of worth Josh kind them. frequency lot net of or do -- and you segment higher respective is and you Hey, something customer the what that the from both database, within driving longer your you believe you more that think play sustainable is Is term specifically? outperformance spend of of

Keith Smith

Yeah.

re-launched program and refocus clock business entirely, started shut play we and pandemic that of allowed effort. have on had then of COVID dial this us to to maybe on supercharge If ago the actually as couple you and requirement the higher journey number completely to the and worth down focus years years back, a a our Connected we a because been the for is B we

on So, we really this play. high-end focused are

past. higher to fewer tell less I I the building. the can’t speak differently spend able we significantly building. spending the they customers driven that the average touches is as by end level. to are lower just largely of higher did them we up, just business, are mean, higher but think, averages, speak have you provide of to at them worth in in reopen and We the than more directly, more the building customers to, We you in the in customers worth the were if lower maybe a at look I

Carlo Santarelli

both then I the take would year-over-year, and makes And X,XXX you assumed run basis them South expect operational in this. guys, the at If those to for basis. second, at if the than would you Downtown margins a and said on of Thank points That Is we in that similar basis and you. kind like, segment Locals and more maintain willing of keep. margins growth to we South basis go-forward shot ignore Midwest two a answering up half XXX to a know and eyes a at But your X,XXX you EBITDAR basis and reasonable sense. kind rates to a looked points. the rate of don’t levels of be little guys margins on Would Josh now at over if could I Midwest think in obviously we up savings go-forward you most close are what right points points XXX-plus looking basis? the

Josh Hirsberg

end end. lower the a those think ballpark So upper at of than more or either in that it’s the ranges I

business, largely about biggest If and way obviously that the are the think you have particular we categories of of are of components made in kind permanent way about marketing, those in think labor the in expense changes our those. and large we a drivers to the

fresh nowhere have I I across same of consumer taking could in potentially, many thing. marketing we same on that doing our at will the the peers sure demands order have a magnitude back based that’s there’s of the categories Now other a made competitive looking a have we terms where removing the the those think case aspect about, permanently fresh largely that have approach in we say taken in industry Board taken And am naturally you potentially approach near from -- of much the They of business a what and labor costs. removed and decisions come but and of the or expenses and our pressures made on are many certain thing are marketing. smaller of

Keith Smith

Yeah.

business Some are as time we over back amenities will as appropriate. as additional labor be open we we added into deem -- the

taken some but So to the incremental labor, be place lot have a view there as we permanent will said, of Josh changes as that nature.

Carlo Santarelli

guys. you, Thank Great.

Keith Smith

Yeah.

Operator

is ahead. The Please with from go Katz next question David Jefferies.

David Katz

well. Hi. of space peers that. ask to you Because what What what that bit. in at Afternoon. others for My a Keith laid you and as can this that terms artfully out us? could something and for and is, − of strategies different question, are just for touched pencil think, participant you on What to arguably the out and be we I have look quite about than in types roll opportunity I position answered I shed a primary light when your of we the of also you a right? we But you thank how point across have, you, wanted kind know you but digital have

Keith Smith

a we losses focus infrastructure creating we compete others, large signed little and down was look of to and and with FanDuel, when started cash and different EBITDA look flow large not on in agreement years our couple this bit business. So we approached this ago opportunity our creating at whereas strategic this a incurring as we building road than it

July, that year we the even recurring of million business or the XXXX, $X and out in approved and about full of so to of is with that And today in Illinois launched it’s the deals million sports and or country, I that hopefully just in a in and across it’s be today so and of Mississippi, just whether Indiana would think Illinois. tell you there Pennsylvania kind betting a range obviously coming as EBITDA the Iowa Illinois will includes more is not nation. we executed have across number as $XX recently FanDuel that

other doesn’t out gaming during online the that doesn’t will that we the flow account would onetime application our million have account million in account states So next of a couple skins and in an for months. to for as cash result $X that the EBITDA additional we will receive the growth launch selling doesn’t come states, for forthcoming fees of $XX other of

So it’s $X million to it’s million isn’t the year million or run a $XX million and $X full to again $XX really rate. full Once growing.

David Katz

much. you Thank Perfect. very

Operator

Kelley Please The with next from ahead. question is go Bank of Shaun America.

Shaun Kelley

Hi. Good afternoon, everyone. were Thanks think margins one the the I for taking actually my question. want we Josh was, or again. your Keith, QX. start you to time QX But it question either over margins in had improved one -- like with maybe does from open, look Locals

So we costs I probably change, of I you are we into sequential how low a admittedly But stuff? go if of you What dig elaborate from to would back impressive? am come because some late very you was kind mean, kind X,XXX, curious up wondering would and for -- open again, drive little it’s on just of deeper. that on I some would if could the longer, could that X,XXX that, up are margin X,XXX on

Keith Smith

when slow heart South the the little work. done have and an And in June, start and it. with that team’s That’s of job, But started businesses Vegas we strong, stronger. at explanation great or the actually is, in started bang here have other the June, as learned the driving explanation softly it we grown. Midwest it July, has whereas started gotten Vegas, in only what tremendous frankly Las gotten think Vegas started a the grown, almost we outstanding have here it early did it a doing Locals And in Las team business. has that Locals is reopened business what real and management that, I have aside, but setting obviously other works doesn’t soft very and quite I the a again is got saying Well, slow Las we better really market I been just in job the has think in

Josh Hirsberg

leading market The some any is our there only back impact thing add And of backdrop have Las think peers questions of I this market. a regional Shaun, period, the have what that’s market what’s fairly out customer weakness is customer the around if of the that, we strong were customer. the were -- is to a on were I of we reopening would the Vegas in lot basically to regional very a on economy and like a our of and kind any saying, look, -- here, anything, Locals mark and strip other proven regional would up a kind regional regional

Shaun Kelley

or of generic to have down just then And what Great. marketing could any driving little labor on us you front, we just out margin the the much types a full front, quarter be down a help data, quantifying the down? magnitudes of very the promotional in improvement, us on a both were buckets think, bit promo just to to spend of these follow-up, labor dial now in the on, basis really of clear on property, going just year-over-year on been have FTE I come dollars as marketing on help maybe -- my counts of Could or business? aspects is sustainable a Again, how the like out of property Josh, and have kind kind much either then or of how reduction of promotional pointing you and for marketing got with side. what’s

Josh Hirsberg

think to the information, same like would that I’d hear like the to I at competitors really you same but Shaun, Yeah. give us our time. thing from

so, to approaching their withhold companies own to the want to approach answering in this similar a of each think I way, maybe is question. think, So business, that I unique I but from the and

Shaun Kelley

Entirely you both. fair. Thank

Keith Smith

Yeah.

Operator

is The from Felicia with Please ahead. Barclays. next question Hendrix go

Felicia Hendrix

Hi, guys. Good afternoon.

we see market the kind about cycle. today So, in a are where of and there’s could in we concerned of Keith, COVID Josh especially lot this

for states And you wave. about so, in whatever wave, months and now that call your you you would of as needed you we re-closures? us head the runway it to concerns your balance be but to could funds Josh get in raise That strong, then into And if great. too? of very just sheet the remind see Do if second want you capacity right third is operate kind colder greater liquidity risks more

Keith Smith

beyond risks closures, we seen you So, obviously where of future the was put Felicia, in positivity the to certain have more of in where that can businesses, control rate restrictions Illinois Illinois. X% including or have Locals certainly in and risen the state started certain a see, variety in a and they terms on think, has casinos it probably, I certain don’t counties of level, of

certainly obviously the impact short-term pass to in We you be that, other business. but could don’t that certainly as ignore obviously, risk. risk would that a We states. view that that or can’t certainly So risk see an through,

are not concerned. We

We it The of as watching are now we in are jurisdiction in fine. Illinois. is

But We reduce are could to that to XX%, certainly has their not huge business. one of but the the any to it. capacity certainly we watching jurisdictions are a resurgence risk be

Josh Hirsberg

billion mentioned, have over in your to undrawn $X my I capacity. Felicia second of we And remarks, question,

amendment of of allowed We ability we raise have about in or another, cash at I are its or that million time million $XXX process even the waivers have million of this so. the period debt think, QX do. end through with our $XXX covenant of $XXX specifically, we to to secured And

when of run a of that’s even could about rate And million have two closed we reduce levels ample to than different kind rate have more we further. trigger to of last run And years those run had had expenses. chosen closure. we the $XX of in the through capacity time on to complete pull that we expenses So, at this excess of first

over years two to completely would again. of every I had close runway property say, the we business conservatively if So,

Felicia Hendrix

for take look you then you life closed to life, you would That’s open What of when what think, think and mean, Keith, kind that. it seek into to a take the terms business, of helpful. the kind could that And Okay. super I are but of back you do Vegas then, get I of lot your Locals like some kind Las of stuff to business properties The breath and Orleans, the now? to in gosh, of, the I back that anticipating it similarly at part normal just convention market like comment at made

Keith Smith

Sure.

I is, come mind, the long here recovery Vegas, slow. in words think recovery about or and as the we to ongoing two think Las

going to slow think be just a recovery. I it’s

When is phone holding to I demand, or the people had pent-up people XXX lifted And come spaces, and have the interested out. ability to there coming think we meetings started certain of ringing. recently in wanting out to some some the cap events. or governor those XX% the

demand for so going that be there And product, but some it to slow long the is it’s recovery. a shows

that at order, see two key I component there record but it said, As them all news reopening Hawaii The will play there’s they The year’s are here is, and quicker flows. results, other the downtown or, than goodness very, in respect Eastside We depend the Cannery of We a Boulder how that probably back Orleans closed was markets, come good have last on Locals With Eldorado. of probably we kept market. a Strip Main so and year it strong close the the yeah, to business market the that property, will last the and of them, Vegas, Orleans three think to record. very in Las the Street,

open Sam’s good the just We demand don’t or Town. enough Eldorado. have Eastside to We yet business at have

the as get I’d soon it, expect as but sometime certainly next demands we So Main Street year business open.

Felicia Hendrix

market steady housekeeping, that that quick the a your or just as were share, just is relatively far properties And as how Great. was open, improved?

Keith Smith

depending market were July, we you numbers run I Las time were reported, for up. August, June, which in would on say, to The actually three would be period they of the last Vegas, the months what actually that up, steady share was

Felicia Hendrix

Okay. you much. Great. so Thank

Josh Hirsberg

you, Thank Felicia.

Operator

from is go The with next question ahead. Wieczynski Steve Stifel. Please

Steve Wieczynski

Yeah. Hey. Good afternoon, guys.

how did slow, I probably trying little new brand this more assume So point? to last call you is back to database quarter. that trending want here at in your I gauge that or during that was like, want which property in your I overall to quarter or go in folks database bit growth to talked your about, the just those the But significant and the third And growth second just ask about to are similar new answer? to on a

Josh Hirsberg

said. if we or − were to away alluding don’t growing you disproportionately took we I Steve, we if Yeah. that our database that think what that’s was if

have are obviously I rated customer we just that hence the of have feel have are the portion we think a database a seeing When customers rated levels. and in within similar reality, our at some that that playing mentioned and Keith now seen kind database. because of just is as we we and coming of delusion because per the prior the are players comfortable. of significant know levels are in don’t out don’t are before older we they playing to up units other And that right demographic not the

seen would they younger are I because that rated we that know not in seeing as call and And a they are earlier just necessarily database, we those demographic, in again but so new we the in the we -- question-and-answer their them. as lastly our spoke from has characterize we segment customer healthy customers unrated that well. component younger, play then know have strength We know the that been the session about of as a once was more because equally

that’s how are am I your about question, sure when we answer it so, to it perspectives. that not frame if from think helps our trying And we but

Steve Wieczynski

I this question, quarter. difficult you helpful. witnessed super But very Josh. the you of but… third the for That’s rest the No. October second quarter, And has then to be might the through Thanks, been question, talked similar about trends a guess

Keith Smith

Yeah.

Steve Wieczynski

the you be for quarter, the elect coming which or -- are this then fourth guys home the going benefit I that how are around that’s ultimately stay whether in … election around a some the year, so up could the around closer to you holidays thinking guess next upcoming some the may to and of folks events be and that maybe guys? week

Keith Smith

home continues mean, diversified once come is a portfolio they so Vegas just stay to and benefit, drive Las our I benefit people can we again that closer ball we clear then from out. to us decide that us, benefiting and and don’t crystal geographically. I are which where business to receive largely of having benefit the far to is will regional think the that if people extent to to

going does election what or the them you the want, that log happens to bet this You spend on look, at with how sports So, out? impacts I people, and impact book to not that prediction point. if a going patterns but make can am a and place

Steve Wieczynski

Okay.

Josh Hirsberg

the of think view say think I as who their was their at is I to we about This do. I form to entertainment. going is they our customer think that, past least is, thing time. what This the they one is way add what today. This is

consistently. up customer and so had I were opened think we played mask they when so we this initially, through and played kind they quite be ones when -- seen that’s the they have sure perform largely away, and to they benefits went we that. why distancing unemployment And we when to first of wearing, When the social honestly enforced show through that

this based and I days. for our their year. single -- showed on survey guaranteeing discern seeing really up we we overcome up the these mind that right from trends way probably that our future. comes over customer will in it’s in every again can show building no best our they holidays can customers go the year, think what they That’s And hurdle and we that’s they on on are can database, our our last of extent who’s in now. that to the Now this But there’s

Steve Wieczynski

has I just more in real been status can quo? Have that XX-year-old one? any pretty it or customer and ask Josh, one you quick And, seen change up

Keith Smith

a point. of have call out us. and see have to we started in I to engage think would some them been with be nothing back this significant there But starting come improvements I small that, trend at

Steve Wieczynski

Okay. Great. Thanks, guys.

Keith Smith

anything positive… If it’s

Steve Wieczynski

Appreciate it.

Keith Smith

It’s positive. not Anything negative.

Steve Wieczynski

Okay. Great. Thanks, guys.

Operator

question Barry Securities. Jonas is go ahead. Truist from next with Please The

Barry Jonas

Thanks. Great.

So a a approaching risk risk do model working different angle. about I wanted scenario with we that How to the to the you under this start maybe vaccine? question from have think

Keith Smith

will Well, a the participate. or so, out game theory it’s come that people the if more vaccine, and there’s implication working is not

there’s business. join Some yet coming upside aren’t out of to come our and us today and so customers out who the comfortable will

it I So else? else, is that that customers today dollars then possible that bit positive time to is possible. somewhere of of us vaccine think overall some business. a their the little the incrementally our spent spending Certainly are with somewhere Is

to their are to us. so with As core Josh form of play tends said a few entertainment minutes ago, and be continue this to they going

us incrementally of come I have natural aren’t positive. there’s customers balancing the out once or come think having once with it’s used back that out, and complain to think, I some a effect, again,

Barry Jonas

the Sorry. of terms I removed? been also meant on more I of have guess, in amenities side some the that cost

Keith Smith

amenities, that back we the we we will them that carefully of that are Well, monitor monitoring a they are need bring extent and bring that property this as them to not specific go where EBITDA to sure the and back we back. drain on and and we make bring positive

Josh Hirsberg

Yeah.

… think I

Barry Jonas

Great.

Josh Hirsberg

…that’s was -- to I say, Barry. going

by open with different presented the toward are possible. be in other right? the way I most of of of advantage that, we are it or think the doing different introducing kind operations there customer Where that’s but not opportunities that circumstances optimal pricing that guys eye amenities to taking key, today with business our demand, model our a are different aspects the or under business make sure may and in −

it’s new result as businesses with historically much I a way think see So, compression we is the much time different don’t that reality are different be will probably we margin we lower some margin customer. introducing amenities, necessarily approaching but a will − those over of in that a

Barry Jonas

How the foray to on topline color then more I your And curious gaming. to you on upside cashless one get maybe just Great. investment? or more the else for justify Great. about do side the think me, into cost am on

Keith Smith

another guest yet it’s come a all, have in opportunity to kind of safety and form out. our of security they our engage to as about first providing entertainment of So, opportunity and contactless

going that’s foremost. first be So to and

insert our bills guests costs and reduce think, it to like a slot download with Second, the there are the in upload I do in don’t in business machines, opportunities and cash the necessarily and handle worth obviously marketing is seamlessly higher they less can don’t to, cash. need building to it and now features, cash frankly,

marketing the had already just at take it live been advantage We real we days with a hundred for a quietly. customers and it’s turned kind opportunity, have marketing. And us. that’s no competitive think in advantage several I it real of on few Chip, of Blue that’s

marketing just this are week. kicking off the We

So I think there’s a for it. real opportunity

Barry Jonas

much. Thanks Great. so

Operator

The with Please Thomas Morgan Stanley. ahead. next Allen question is from go

Thomas Allen

you anything from do you. think Difficulty] Thank XXXX [Technical [Technical EBITDA Difficulty].

Keith Smith

are you breaking Thomas, up.

Thomas Allen

Are you going to…

Keith Smith

are up. breaking you Thomas,

Thomas Allen

Can Hello? you me hear now?

Josh Hirsberg

little bit. A

Thomas Allen

hit up years sports [Technical there from as million between [Technical any market I two Thanks. think had books. Difficulty] And you retail interesting you trends have then? kind Difficulty] we gone of what your sports are betting on access seeing have and

Josh Hirsberg

understand you. Gary, Hey, circle -- go let’s caller person and then Thomas Thomas. back next really We try we her couldn’t call again. to will the and

Operator

Okay. go The Research. Please next ahead. question Wolfe with Jared Shojaian is from

Jared Shojaian

afternoon, Good my Hi. Thanks for question. taking everyone.

would the you just mix on imagine also now out So the margins say performance your way. that I margin meaningfully the mix I significantly slot the that right the margin. affecting imagine on not side data know given no? Is the on effect meaningful the right is slots probably having But now. a broken is outperforming I are higher explicitly tables would or that’s

Keith Smith

has improvement. table are slot table Yeah. through side Really, perform The we games the and table. the average margin to mean, down and the revenue table of dragging impact just, as the it’s no yielding margin XX and table a and we table gaming increased Clearly, so on company crafts so game because There’s But our a bets side, people business comes the are on at performing table yielding and while at the the on obviously, slots not overall opportunities question. as bigger XX% business. well as overall better, is capacity of is business. four they fewer a have I baccarat fewer as there limited games seats

Jared Shojaian

or we then, holding you over stake sports here, your the And that do would the how talk in consider Is to are importance iGaming thinking is you onto gears term? believe switching you strategic you. Thank valuations about just something it. just monetizing longer it? with you FanDuel seen Can given Got about just and what have ever names. there

Keith Smith

operate equity that got worth that it leader we They we business they to company. state tech. partnership, are are I great two They a number in have the great amount of very mean obviously, with, or one been They every have that in. number whether a to-date are happy have, value in they the tremendous partner. ownership is almost

you. right years So, that partnership the goes, Longer I great. is think, from I now, term, where years now, tell three couldn’t really five to

We focused not are on that.

We ownership are it’s focused we interest with partnership and today the happy on have. next are the great several we and years a

Jared Shojaian

All right. Thank you very much.

Operator

The next with question ahead. go Please is Macquarie. from Chad Beynon

Chad Beynon

it of different that some in competitors, just Circa just the away taking terms you a question. to hearing how view, really changed how you my to towards product how the of I Thanks marketing take if into your think, afternoon. final the in Good that, Hi. terms who or I guess and the that have with won’t what market? an and really any next just what is get believe Obviously, But property Downtown it or extremely I fits there? two you believe anything it on views is you caters for anyone but Has that opens evolves. is. from product given and kind in days, and of are most early that days update wanted three of Circa that

Keith Smith

Yeah. I would agree.

to lot the and a visit block a look of area properties to a it’s we directly it, a at directly it, property to behind product. also I down a product I it is a there end Generally product and much high with the differentiated than which what of today. a the end is It have away to draw visitors Downtown think exception is think Nugget, it. speaking, is higher very going two -- property obviously,

Island mainly and by business So we beneficiary customers, the and of lion’s share there. and of all our will out traffic so the down to driven will that is take incremental. comes in the be be foot traffic the all of Downtown Hawaiian Hawaii going the of Remember, advantage around of visit Circa

Downtown I it’s to market. -- think I it the for think great is going

be this think great, forward week. is open product I it to great the just and later the to going overall investment looking is having

Chad Beynon

maintenance product slot Thanks, how Do guess or big believe then, products? on I will a that other and items you there terms expecting $XX and budget. Josh, the for Great. and gaming gaming not I updating you the of in of as budget said, CapEx thinking CapEx that the much forward? going And the are But Keith. for you CapEx, need about we your around are then mix believe properties fourth quarter in million between be

Josh Hirsberg

think on that I have evaluate the and slot floor times. slot folks machines the that, that are Look, we to make product best playing I have think out and we all at sure

that. or reflect be at I enough than any not to it And it not. don’t I am that so kind it think -- been it’s has this means But historically. our know budgets will of point I don’t think larger we say if will lower

I coming think think. largely would next year we into

out the there. to understand that’s could exactly footprint. technology. product, improved I is because we fewer you the And -- today product the getting today to and going same we forward types but process going quote-unquote step. As be how develop today, and have a much that when and have the is, of are really and I that then, about you out how you rethink same, many first And are laid secondly, per you getting of a how to and to in kind reality think you same how of as it the want is had which think try make you -- are results you floor the slots on floor is slot trying out overall a through have machines to the reinvest out you floor smaller to now utilizing just be that reinvest will that But units than sure the in capacity more going other it are figure are gaming had

Chad Beynon

Okay. Thank much. very you

Josh Hirsberg

Chad. Yes,

Operator

go question DeCree next Union John The is with ahead. from Gaming. Please

John DeCree

Thanks taking my Hi, for everyone. questions.

Keith Smith

Hi.

John DeCree

might still your comment, constraints. capacity with missed but any operating having more during during capacity if of you not it seeing constraints I I capacity are we peak if sorry, certain to you lot some a think at you is what could last capacity of you and a was point significant am sure periods. already Do I markets have could about if comments benefit I wondering when loosen, times pretty little and know are follow-up those a you bit Josh constrained feel good back?

Keith Smith

majority John. say, So Keith, we would this really is I the constrained. of our for today is during are this properties times, peak not capacity

of We have few Delta for could use no. Downs part, XX%-ish and counts, periods, restriction. but generally most and few with have lower a think They peak are they X,XXX that a more at properties machine units the during therefore,

are to capacity. respect bumping We not into ceilings with

reduced So we visitation significant our remember now buildings. throughout have

phases. the through So we haven’t that seen opening problem

John DeCree

Got it. do if of I That’s helpful. ask $XXX one here. more kind And could million

Keith Smith

Yeah.

John DeCree

Illinois. of reduced there today? if have what of some you slack of If some we gaming reaction saw you is much And lower going about revenue additional sustainable variable if or notable the closures, taxes period forward realizing outside saw already could you in cut an risk In a gets kind are earlier costs that revenue flex the and costs? like there’s of substantial in decline, assessing of closures I reason, tweak, difficult. we amount winter potential was a question think revenue it you seeing are How than is a system, for seeing some the whatever

Keith Smith

focused, How hard Is it’s or on where in of revenue game theoretical very customers that fairly those ways the a which a much up. a answer is showing to it to can end it’s to and Is reduction. and coming some to the how It reduce are theoretical on it, -- decline answer have we amenities hard and probably It’s environment. So Yeah. where dozen a different customer unrated depends the question customer? question from. higher through slot our nongaming half customers? continue it there’s not much focused depending that we

a provide to intelligent I So, you. question, very don’t tough answer think can I

Josh Hirsberg

would there one few I fixed in our business. thing like, that given us John, is expenses insight add, crisis though, into has thing the one The very too, are is

significant industry a flexibility adapt. Keith’s going quite so seeing what’s a point, revenue are an of weakness from of to to quickly. to revenue from perspective. has on the business you where you lot where we ability little depends to amount whole your have revenue adapt happening of to And But shown very adapt a or And kind to

in everything of think I So of between kind just iterations becomes that.

John DeCree

that. question. helpful. Tough That’s Got

fairly it well. think I guys you Thank answered you.

Keith Smith

Yeah.

Operator

The go ahead. with from next question Joe is Susquehanna. Please Stauff

Joe Stauff

afternoon. Good

Just two if please. I follow-ups can,

answer this would or So, can require in can it, Josh, what But normalized want notable don’t I to say define traffic, us. level marketing you or of a know however, if whatever XXXX or spending? give you change traffic you

Josh Hirsberg

that think think don’t we I about would that it way.

kind choose at way think building levels are and the is that perspective. in then we our of that -- our loyalty customer I the best -- marketing customers to we customers the profitability the quite the today we different to honestly are of a for from we ensuring what and of reinvesting want making kind right of based tiers our have sure to on market

Obviously, range worth customers their were have But the today. of investment you aren’t driven were think to I to based building approach then peers sensing think not through trying to our getting more is, much is Historically well. kind reinvestment extent we that’s that historically. who the getting of slightly so in more potentially perhaps a this. the our volume I what’s and previously and least they think worth of I who as at drive that that, because did am outcomes are on result different of drive guys have and than are I we by try today

that that profitable a trying was have lot the may when incremental you better who had better to were drive we with are just them with closed been We they was not who toward the lower actually volume than volume profitability We business costs associated the weren’t able and and profitable ever had and for perhaps see to modest that that profitable. some all thought associated wasn’t end customers sake.

kind of so And sure of if quite return of I so, that know of don’t customer a really some volume am not level I helps, on dependent honestly. it’s Joe.

Joe Stauff

at that maybe does et the point would this casual more data extent the to there It sounds whatever, after better, mean, at point like very be the driven that I world and fair? more marketing then gets is customers, it No. spend certainly. if are cetera, it’s vaccine, you increased

Keith Smith

that read it. wouldn’t into I Well,

Joe Stauff

Yeah.

Keith Smith

and have later vaccine efficient sooner pandemic return that mentioned profitable the And fades starts that as more model today that to is we are it’s a year normal. to in hopefully return out normal. comes created and vis-à-vis comments to drawing hold this than think not getting with. hopefully I as EBITDA that more last prepared we is model COVID later this comfortable increased takes my sooner are a I and prepared than business we to

We sticking with model. refined are committed this to business

and model pleased right that. is So are year’s now the profits creating profits excess we in with of last pretty

Joe Stauff

I can. Understood. follow-up if One

side. digital Just on the

first And I whenever year money as -- what effectively guess them pay BXB that, real And proprietary correct. stack, is are FanDuel’s where will stack. arranged? you tech sounds that next do are -- you in quarter So want the early your a what fee of though sometime those is. for offering economics if it you that economics I are using the that or am is you using tech How

Keith Smith

Yeah.

actually they yet. into right and us, to have gotten stack we are run the do using expertise this for you it haven’t are asking are to we that we where their tech So them because business

obviously XXXX, revenue be that continue about million $XX to grow, will that much $X talked of million share we get to larger will expect for continue of a out that it so we we And that kind year. next to to will I arrangement

Joe Stauff

much. very Thanks

Operator

and for time question with We that Allen more have Stanley. from go ahead. is Thomas Morgan question one Please

Thomas Allen

Hi. Good afternoon.

So can there a mature books. that you the than this just And this and $X is books to sports guys you newer help seeing certain in Mississippi then betting, unpack you help sports and that books retail to that are between like stage opened that access? broader are $XX on properties? sports ago follow-up million just there question, you year more market are the retail doing you Thank And that would the in some to sports the books generating years helpful? what if you Can earlier benefit sports books different about two dynamics then be think like those us of are you. sports kind more versus are seeing us

Josh Hirsberg

is spoke Retail separated number real sports, in results. Sure. business. -- digital from FanDuel to, include their the The that’s Thomas, gaming we of year, The out So That’s the million alluding first purely a from the doesn’t their right? property-level money building the coming to Keith online share kind take Pennsylvania. that one. and business individual in throughout the for rate that’s he million mobile online it’s $XX for site is receive revenue Keith that of FanDuel. what this It piece not will online $X was run that’s revenue share what component. component I and is included retail about was

part? first want that’s you take do the question. the part So Keith, second your to of

Keith Smith

are the and Look, attracts of best the breadth bets two, the the sports of that or market, what a sports as you what’s on talking having in helpful the one make. are terms players. depending the one to they can kind offerings broadest or state us is of books you is, of whether really FanDuel in kind leader being And of the and menu odds about of some type menus of mature,

of the I and overall bets sophisticated the ease think has, over Mississippi the time They more of a of the make. the well types as maybe in use, the customers about offering, of app sports seen the a place have in previously. business continue existed as that hadn’t customers as different quality little we that realize it just FanDuel quality let’s attract say, the where more number betting can grow, become the of you to

an as increasing so that we and think becomes more coming helped the see to has of customer I customers sophisticated, participate. number

Thomas Allen

Thank Got it. Helpful. you.

Keith Smith

Yeah.

Operator

conference I concludes closing This to for session. remarks. over back Hirsberg Josh question-and-answer any to the would turn our like

Josh Hirsberg

any of day. to further, free questions much. or And good very thanks please and rest a your you if joining Gary. would discuss all to for have like out feel to company. follow-up you Thank today Have to reach Thanks, you of the

Operator

today’s you has conference The presentation. now Thank for attending concluded.

You now may disconnect.

Boyd Gaming (BYD) 26 Oct 202020 Q3 Earnings call transcript