Four Station Casinos properties in Southern Nevada that have been closed since mid-March out of pandemic concerns might not reopen, said Frank Fertitta III, CEO and chairman of the board of directors for Red Rock Resorts, the parent company of Station Casinos.
On June 4, the company reopened more than a dozen properties after nearly 80 days of closures out of coronavirus concerns. But the Palms, Texas Station, Fiesta Rancho and Fiesta Henderson remained closed.
“We don’t know if or when we’re going to reopen any of the closed properties,” Fertitta said. “We think it’s too early to make that decision.”
Fertitta made his comments Tuesday during a quarterly company earnings call. For the three-month period that ended June 30, Station reported net revenue of just over $108 million, down nearly 76% from the same quarter in 2019.
Considering the difficult economic conditions for casino operators — people are traveling less and leaving their homes less, overall — Fertitta said there were bright spots during the quarter.
For instance, for the 16 casino businesses in the Las Vegas-area that Station opened on June 4, EBITDA — earnings before interest, taxes, depreciation and amortization — were up 47% through June 30 when compared to the same period in 2019.
That’s despite a drop in net revenues of about 23%. The company said the encouraging EBITDA numbers were partially the result of the “streamlined cost structure” that was implemented upon reopening.
“So far, we’re pleased with the results we’ve had and the ability to move some of the play from our closed properties to our existing properties,” Fertitta said. “We’re going to continue to get clarity and to navigate the situation to make well-informed decisions. Whatever decisions we make will be made in the best interest of shareholder value.”
Fertitta said the company took advantage of the importance of gaming to its bottom line to post solid numbers in June.
“We’re primarily a gaming company that happens to have hotel, catering and convention business as an amenity,” Fertitta said. “Primarily, 80% of our business comes from the casino, so we’re able to have the results that we had in the short-term without strong hotel, catering and convention. Hopefully those will return as we get the COVID-19 crisis under control, but our primary business is suburban Las Vegas local business.”