L
as Vegas-based Golden Entertainment Inc. stated Wednesday the new Resort World Las Vegas has not made an impact on operations at the company’s The Strat, as the operator reported a record Q3 revenue, net income and adjusted cash flow for the period ending on September 30.
Golden Entertainment reported 2021 third quarter revenues of $282.4 million compared to $205.4 million for the third quarter of 2020. Net income for the third quarter of 2021 was $29.1 million, or $0.91 per fully diluted share, compared to a net loss of $7. million in a year-over-year contrast. Adjusted EBITDA was $73.4 million, compared to $45.9 million for the third quarter of 2020.
Golden Chairman and CEO Blake Sartini responded to an analyst’s question on Wednesday about the effect of Resorts World on the North Strip and the Strat, as analysts had forseen that the presence of the 3,500-room Resorts World would lead to an increase in visitation at North Strip properties, including Wynn Las Vegas, Encore, Circus Circus, Sahara and the Strat.
Sartini said it is too early to tell, noting construction on the road in Las Vegas Boulevard: “There’s pretty significant construction going on on that boulevard and it’s impacting foot traffic as well as vehicle traffic going north and south. As that begins to dissipate, that construction goes away, conventions come back, Resorts World capitalizes on its residencies and conventions and so on. All of the inertia will ultimately benefit the Strat and that’s one of our key theories on that property. We do anticipate no negative impact going forward. I anticipate a positive impact as the construction ends and citywide conventions return.”
Resorts World Las Vegas.
The opening of the Las Vegas Convention Center’s West Hall and a prospective restart on the Fontainebleu project could change the Strip landscape in the future.
“Our third quarter results demonstrated sustained growth and margin expansion for our casinos and distributed gaming segments compared to the third quarter of 2020 as well as comparable pre-pandemic quarterly periods,” Sartini said. “The strong performance across all of our operations despite occupancy at the Strat and our Laughlin properties still not having fully recovered to 2019 levels is an encouraging indicator for our future performance. ”
Meanwhile, weekend occupancy and room rates are equaling comparable periods in 2019 and midweek business is improving, Sartini said, contrasting 2020.
Charles Protell, Golden’s president and chief financial officer, told analysts on the call that the company has repaid more than $50 million of outstanding debt obligations in the quarter and more than $100 million in the last six months. Golden shares, traded on the Nasdaq exchange, climbed $1.15, or 2.2%, to $53 a share.
