Operator News

US – Red Rock just 11 per cent off pre pandemic revenues

By Phil - 30 July 2021

Red Rock Resorts reported net revenues were $428.2m for the second quarter of 2021, an increase of 295 per cent, or $319.7m, from $108.5m for the same period of 2020, primarily due to the closure of properties during most of the second quarter in 2020 due to the COVID-19 pandemic.

During the second quarter the company continued to operate its Red Rock, Green Valley Ranch, Santa Fe Station, Boulder Station, Palace Station and Sunset Station properties, together with its Wildfire Properties, while Palms Casino Resort, Texas Station, Fiesta Rancho and Fiesta Henderson remained closed during the quarter. While second quarter 2019 results are included below for comparative purposes, the 2019 results include, among other things, the results of our four currently closed properties in addition to the properties which operated in the second quarter 2021.

Compared to the same period of 2019, net revenues were down 11 per cent or $54.7m from net revenue of $482.9m.

Stephen Cootey, Executive Vice President, Chief Financial Officer and Treasurer, said: “We continue to see strong and consistent visitation from our younger demographic, increased spend per visit, more time spent on device plus the continued return of our core customer. And as the government mandated capacity restrictions rolled off during the quarter, we began to see the return of our non-gaming segments as both hotel and food and beverage revenue ex buffet has returned to pre-COVID levels.”

Net revenues from Las Vegas operations were $426.4m for the second quarter of 2021, an increase of 322 per cent, or $325.4m, from $101m in the same period of 2020, primarily due to the closure of our properties during most of the second quarter in 2020 due to the COVID-19 pandemic. Compared to the same period of 2019, net revenues were down seven per cent or $31.3m from net revenue of $457.8m.

Adjusted EBITDA from Las Vegas operations was $222.6m for the second quarter of 2021, an increase of $234.7m, from negative $12.1m in the same period of 2020. Compared to the same period of 2019, Adjusted EBITDA increased 110 per cent or $116.6m from $106m.

With regards to the company’s proposed Durango development, located off the 215 Expressway and Durango Drive in Southwest Las Vegas Valley, Mr. Cootey said: “We are extremely excited about this project. The project is located in the fastest-growing area in the Las Vegas Valley, and there are no unrestricted gaming competitors within a 5-mile radius of this project site. We are working through the planning and budgeting phases of this project with the goal and expectation to have a shovel in the ground in the first quarter of 2022. Once the project is started, we anticipate construction will take approximately 18 to 24 months. When complete, the project will include over 100,000 square feet of casino space with over 2,000 slots and 40 table games, a state-of-the-art sports book, over 200 hotel rooms and suite product and 4 full-service food and beverage outlets.”

Mr Cootey explained that Red Rock would be appealing the ruling against North Fork in the state of California, a decision, whereby in August 2020, the California Supreme Court had effectively reversed and remanded to the lower court with the instructions to reconsider its prior decision against the Tribe.

“We believe that this lower court decision contravene the California Supreme Court instruction as well as California law,” he said. “Both Tribe and the State of California have already filed and completed the briefing on their separate petitions for review with the California Supreme Court. We expect to hear whether these petitions will be granted in the next five to nine weeks. In the meantime, we have continued to progress our efforts with respect to this very attractive project, including the development and design and initial talks with prospective lending partners. We expect to be in a position to provide an update at or prior to our next quarterly earnings call.”