Boyd Gaming Corporation (BYD (SZ:002594)) reported its fourth-quarter 2024 earnings, surpassing Wall Street expectations with an earnings per share (EPS) of $1.96 against a forecast of $1.78. The company also exceeded revenue forecasts, reporting $1.04 billion compared to the anticipated $997.74 million. Following the announcement, Boyd Gaming’s stock rose 2.72% to $80 in aftermarket trading. According to InvestingPro data, the company maintains impressive gross profit margins of 62% and trades at a P/E ratio of 15, suggesting reasonable valuation metrics for the sector.
Key Takeaways
- Boyd Gaming reported record full-year 2024 revenues of $3.9 billion.
- Fourth-quarter revenue surpassed $1 billion for the first time.
- The company’s stock price increased by 2.72% in aftermarket trading.
- Boyd Gaming returned nearly $750 million to shareholders in 2024.
- The Las Vegas Locals segment achieved margins exceeding 50%.
Company Performance
Boyd Gaming showcased a strong performance in 2024, with revenues reaching a record $3.9 billion and EBITDAR nearly $1.4 billion. The company’s diversified portfolio, spanning Las Vegas locals, Downtown, Midwest, and South, continued to perform robustly, contributing to its impressive financial results. The Las Vegas Locals segment, in particular, demonstrated exceptional profitability with margins exceeding 50%. InvestingPro analysis reveals the company maintains a strong financial health score of GOOD, with particularly high marks in profitability metrics, including a notable 29% return on equity.
Financial Highlights
- Revenue: $1.04 billion (Q4 2024), surpassing the forecast of $997.74 million
- Earnings per share: $1.96, above the forecast of $1.78
- Full-year 2024 EBITDAR: Nearly $1.4 billion
- Property level operating margins: Over 40%
Earnings vs. Forecast
Boyd Gaming reported an EPS of $1.96, beating the forecast of $1.78 by 10.1%. The revenue of $1.04 billion also exceeded expectations by approximately 4.2%. This performance marks a significant achievement for the company, reflecting its ability to surpass market expectations consistently.
Market Reaction
Following the earnings release, Boyd Gaming’s stock price increased by 2.72% to $80 in aftermarket trading. This rise reflects investor confidence in the company’s strong financial performance and positive outlook. The stock’s current price is above its 52-week high of $78.63, indicating a bullish sentiment among investors. InvestingPro data shows the stock has delivered an impressive 44% return over the past six months, with 5 analysts recently revising their earnings estimates upward. Subscribers to InvestingPro can access 12 additional exclusive insights about BYD’s momentum and valuation metrics.
Outlook & Guidance
Boyd Gaming has projected a stable outlook for 2025, with the online segment expected to generate $80-$85 million in EBITDAR. The company plans to continue investing in property improvements and maintain a balanced capital allocation approach, including $100 million in quarterly stock repurchases. The company has demonstrated commitment to shareholder returns through both aggressive share buybacks and consistent dividend growth, with InvestingPro data showing three consecutive years of dividend increases and a current yield of 0.87%.
Executive Commentary
"2024 marked another successful year for our company," stated Keith Smith, CEO of Boyd Gaming. He emphasized the company’s ability to generate substantial free cash flow through its diversified business model. Smith also acknowledged the hard work of team members as a key factor in the company’s success over the past five decades.
Risks and Challenges
- Potential tax policy impacts on consumer spending could affect revenue.
- Competitive pressures in various markets may challenge growth.
- Macroeconomic factors, such as inflation, could impact operating costs.
- The ongoing renovation and development projects may face delays or cost overruns.
- Changes in regulatory environments could affect operations.
Q&A
During the earnings call, analysts inquired about potential tax policy impacts on consumer spending and the company’s approach to mergers and acquisitions. Executives also addressed the performance of the Treasure Chest Casino (EPA:CASP) and discussed strategies to mitigate competitive pressures in various markets.
Full transcript - Boyd Gaming Corp (NYSE:BYD) Q4 2024:
David Strow, Vice President of Corporate Communications, Boyd Gaming: Good afternoon, and welcome to the Boyd Gaming Fourth Quarter and Full Year twenty twenty four Earnings Conference Call. My name is David Strow, Vice President of Corporate Communications for Boyd Gaming. I will be the moderator for today’s call, which we are hosting on Thursday, 02/06/2025. At this time, all lines are in listen only mode. Following our remarks, we will conduct a question and answer session.
Our Speakers for today’s call are Keith Smith, President and Chief Executive Officer and Josh Hirschberg, Executive Vice President and Chief Financial Officer. Our comments today will include statements that are forward looking statements within the Private Securities Litigation Reform Act.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: All forward looking statements in our comments are as of today’s date, and we undertake no obligation to update or revise the forward looking statements. Actual results may differ materially from those projected in any forward looking statement.
David Strow, Vice President of Corporate Communications, Boyd Gaming: There are certain risks and uncertainties, including those disclosed in our filings with the SEC that may impact our results. During our call today, we will make reference to non GAAP financial measures. For a complete reconciliation of historical non GAAP to GAAP financial measures, please refer to our earnings press release and our Form eight K furnished to the SEC today, and both of which are available at investors.boygaming.com. We do not provide a reconciliation of forward looking non GAAP financial measures due to our inability to project special charges and certain expenses. Today’s call is being webcast live at boygaming.com and will be available for replay on our Investor Relations website shortly after the completion of this call.
So with that, I would now like to turn the call over to Keith Smith. Keith?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Thanks, David. Good afternoon, everyone. 2024 marked another successful year for our company as our diversified business model, continued operating efficiencies and recent property investments all contributed to a strong full year performance. We generated over $3,900,000,000 in revenues in 2024, setting a full year record and we achieved company wide EBITDAR of nearly $1,400,000,000 while maintaining property level operating margins of over 40%. These results demonstrate our company’s continued ability to deliver a high level of performance.
Looking at the fourth quarter specifically, our performance was consistent with the solid results we have achieved over the last several quarters. Quarterly revenues surpassed the $1,000,000,000 mark for the first time, while EBITDAR increased to nearly $380,000,000 Our fourth quarter performance, much like our full year results, it was driven by our diversified portfolio, efficient operations and contributions from our recent property investments, most notably a treasure chest. Importantly, throughout our property operating segments, we continue to see strength in play for our core customers and stable trends in play from our retail customers. Now let’s review segment results in more detail. Starting with our Las Vegas Local segment.
During the fourth quarter, we delivered our best year over year performance of 2024 despite ongoing competitive pressures in the market. Excluding Orleans and Gold Coast, our Las Vegas locals properties continue to perform better than the same store market and our operating margins continue to exceed 50%. Play from our core customers continued to grow across the segment during the quarter, while play from our retail customers improved. And our ongoing project to enhance the Suncoast is beginning to show its potential as this property posted a solid performance despite the addition of a new competitor in the market in late twenty twenty three. Next (LON:NXT), we delivered another strong performance in our Downtown Las Vegas segment during the fourth quarter.
Our recent enhancements at our Downtown properties are providing us a solid foundation for long term growth. Similar to our Las Vegas Local segment, overall customer trends were consistent with recent quarters with growth in play from our core customers and consistency in play among our retail players. Visitation from our Hawaiian customers remains healthy, while pedestrian traffic throughout the downtown area has been steady. Looking at the Southern Nevada market more broadly, fundamentals of the local economy remain strong with recent gains in employment, personal income, population and tourism related activity. Local employment has grown for forty five consecutive months now with increases across most major employment sectors.
Average weekly wages increased nearly 6% during the fourth quarter, outpacing the national growth rate. Southern Nevada’s population has surpassed 2,300,000 residents and continues to show growth with homebuilding permits increasing 13% over the prior year. Total (EPA:TTEF) visitation to Las Vegas remains healthy, growing more than 2% over the prior year to nearly 42,000,000 visitors in 2024. And airport traffic continues to achieve record levels exceeding 58,000,000 passengers last year. By the end of the first quarter this year, airline capacity is expected to increase by another 3%, which includes continued growth from international markets.
Finally, residential and commercial construction activity remains robust throughout Southern Nevada with more than $8,500,000,000 in notable projects currently under construction. In all, we remain confident in the long term strength of the Southern Nevada economy as we enter 2025. Outside of Nevada, our Midwest and South segment achieved another quarter of growth led by continued strong results at Treasure Chest Casino. Our new facility at Treasure Chest has consistently performed ahead of expectations since opening in June and remains on track to exceed our targeted EBITDAR return. While Treasure Chest was the strongest performer in this segment on a year over year basis, we were also pleased with the performance of our same store operations.
After adjusting for certain one time benefits in the fourth quarter of twenty twenty three, same store revenue and EBITDAR grew slightly, while margins remain consistent to 37%. And on both a total same store basis, play from our core customers continue to grow, while retail customer play remains stable consistent with recent quarters. Next, our online segment once again contributed to company wide growth. With a strong fourth quarter performance, our online segment generated $76,000,000 in EBITDAR for the full year after excluding 32,000,000 onetime fees. This performance reflects continued growth from our market access agreements, primarily with FanDuel, as well as contributions from our nascent online gaming business.
Beyond the financial contributions from our online segment, we also have significant value in our 5% equity interest in FanDuel. Across the country, FanDuel is strengthening its position as America’s leading online gaming company, further enhancing the considerable value of our equity stake. Finally, our managed business closed out 2024 with another solid quarter of growth. For the full year, this business generated $96,000,000 in EBITDAR, driven mainly by management fees from Sky River Casino. As Sky River continues to perform at a very high level, work has begun on a significant expansion of this property.
Work is now underway on the first phase of that expansion, which will add 400 slots and a 1,600 space parking garage to the property. Upon completion of Phase one, first quarter of twenty twenty six, construction will begin on the second phase of the expansion, which will include a 300 room hotel, two additional food and beverage outlets, a day spa and an entertainment and events center. Once fully complete in mid-twenty twenty seven, this expansion will position SkyRiver for continued long term growth, further strengthening its reputation as one of Northern California’s leading gaming entertainment destinations. So in all, both our fourth quarter and full year results demonstrated our company’s continued ability to deliver a high level of performance. And we are building on our track record of success as we continue our program of investing in our nationwide portfolio.
An example of these investments is the ongoing renovation of our hotel room product. We have recently begun hotel renovations at the Orleans, IP and Valley Forge, which account for nearly one third of our hotel rooms across the country. When combined with other recently completed hotel renovations, we will have refreshed and updated nearly 60% of our hotel room inventory by next year. We’re also enhancing the customer experience throughout our properties. An example of this is the Suncoast, where we opened a new sportsbook, high limit room and premium steakhouse in 2024.
All of these new amenities have been well received by our customers, helping drive solid results of Suncoast over the last several quarters. Next to come at the Suncoast is a complete renovation of the casino floor, a new food hall and an expansion of the property’s meeting space. We unveiled the first section of the Suncoast casino renovation earlier today and are on track to complete all property enhancements by early twenty twenty six. In addition to enhancing our properties, we continue to pursue strategic growth investments in our portfolio. At Ameristar St.
Charles, we are making progress on the expansion of that property’s meeting and convention center. Ameristar’s existing meeting and convention business is a core part of its business model. With a four diamond rated hotel, extensive amenities and close proximity to the St. Louis Airport, Ameristar sees more demand than it can currently accommodate. With demand already exceeding our current space, the Ameristar team is having great success booking future business for its expanded convention center, positioning the property to deliver strong results once our expansion is completed this fall.
Next in Southern Nevada, we remain on schedule to open Cadence Crossing Casino in mid-twenty twenty six. This development will replace our existing Jokers Wild Casino with a modern casino entertainment experience. The nearby master planned community of Cadence 1 of the fastest growing neighborhoods in the Las Vegas Valley and this development will position us to capitalize on
: the
Keith Smith, President and Chief Executive Officer, Boyd Gaming: growth. Cadence Crossing will begin as a smaller property with four fifty slots and several restaurants. But as the Cadence community continues to grow towards its full build out of 12,000 homes, Cadence Crossing will grow with it with plans for hotel, more casino space and additional amenities. And as work continues on these projects, we are developing plans for the next investments in our property growth pipeline. One of these projects will be in Central Illinois, where we anticipate replacing our 30 year old Riverboat Casino at Paradise with a compelling new entertainment destination.
While it is still early in the design process, we could begin construction as early as the first half of twenty twenty six pending regulatory approvals. We are confident that this project will deliver a solid return on our investment by driving incremental growth in visitation and business volumes at Paradise following its completion. In addition to ongoing investments in our existing properties, we’re also investing to expand our portfolio with our resort development in Norfolk, Virginia, where construction is set to begin shortly. This $750,000,000 project will further diversify our portfolio by expanding our presence in one of the largest underserved gaming markets in the Mid Atlantic region. We are confident in our ability to create a market leading resort experience in Norfolk that will attract customers from throughout the region serving as a key growth driver for both the City Of Norfolk and our company.
The resort, which is scheduled for completion in late twenty twenty seven, will include a casino with 1,500 slots and 50 table games, a 200 room hotel, eight food and beverage outlets, live entertainment and a 45,000 square foot outdoor amenity deck. Part of this project, we plan to open a modest transitional casino this November. In all, these investments form the foundation of our future growth. And while we are investing in these strategic growth opportunities, we are also continuing to return capital to our shareholders. In the fourth quarter, we repurchased $2.00 $3,000,000 in stock, bringing our total repurchase activity for $20.24 to $686,000,000,000 While we have repurchased more than our targeted level of shares over the last several quarters, this has been purely opportunistic.
Looking ahead to 2025, we remain committed to $100,000,000 per quarter in repurchase activity supplemented by our ongoing dividend program. In addition to investing in growth opportunities and returning capital to our shareholders, our balanced approach to capital allocation includes maintaining a strong balance sheet. We ended 2024 with total leverage of approximately 2.5 times giving us a strong foundation to continue our successful approach to capital allocation. So as we look back on 2024, we are pleased with the performance of our company, strong foundation we have built for the future. We continue to generate substantial free cash flow through our diversified business model and our consistent operating performance.
Our ongoing property investments are delivering solid returns and positioning us for long term growth. And we are successfully balancing these investments with our capital return program, returning nearly $750,000,000 in capital to our shareholders in 2024, while maintaining the strongest balance sheet in our company’s history. Finally, before I turn it over to Josh, I I wanted to take a moment to recognize a historic milestone for our company. January one of this year, we celebrated Boyd Gaming’s fiftieth year in business. We’ve come a long way since Sam and Bill opened the California Hotel and Casino in 1975.
Since then, our company has grown from that single property in Downtown Las Vegas into one of the largest and most respected gaming companies in The United States. And while our company is much different today than it was in 1975, the vision and integrity of Sam and Bill Boyd continue to guide us to this day. Their commitment to growth and their commitment to making a positive difference for our team members and our communities are principles that we proudly carry forward as a company. Our success throughout these past five decades would not have been possible without the hard work of our team members. Their dedication to delivering memorable service for our guests is what makes the Boyd experience unique.
Thank you for your time today. I would now like to turn the call over to Josh.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Thank you, Keith. The fourth quarter represented the conclusion to a very good year for our company. We finished 2024 generating nearly $1,400,000,000 in EBITDAR with annual property level margins exceeding 40%. As a result of our performance, our diversified portfolio generates significant free cash flow that we are deploying to reinvest in our business and return significant capital to our shareholders. I’ll now provide additional commentary on our fourth quarter and full year 2024 results and provide comments on our 2025 outlook.
Beginning with our online segment. In this segment, we generated $108,000,000 in EBITDAR for the full year of 2024, including $32,000,000 in non recurring market access fees. For 2025, we expect to generate approximately $80,000,000 to $85,000,000 from our online segment, which compares to the $76,000,000 of run rate EBITDAR in 2024. This segment includes contributions from our revenue share agreements and Boyd Interactive. For reference, the tax pass through amounts reported as revenues and expenses in our online segment were $128,000,000 for the fourth quarter and $450,000,000 for the full year of 2024.
This compares to $97,000,000 in the fourth quarter of twenty twenty three and $328,000,000 for the full year of 2023. In our managed business, we generated $96,000,000 for the full year of 2024, primarily driven by the management fees we earned from Wilton Rancherias Sky River Casino. We expect to generate a similar amount of EBITDAR in 2025 from our managed and other businesses. In terms of capital expenditures, we invested $111,000,000 in capital during the fourth quarter, bringing total 2024 capital spend to 400,000,000 For 2025, our capital investment plans include maintenance capital, incremental maintenance capital related to our hotel room refurbishment initiative, recurring property growth investments and starting our development project in Virginia. In terms of each of these capital spend categories, we estimate our recurring maintenance capital to be approximately $250,000,000 per year.
We will spend an additional amount on maintenance capital related to hotel room refurbishments this year of approximately $100,000,000 at IP, Valley Forge and the Orleans. Our initiative to upgrade our hotel rooms is scheduled to be complete in mid-twenty twenty six. In terms of our recurring property growth investments, we expect to invest approximately $100,000,000 each year. In 2025, this amount includes investments in the convention expansion at Ameristar St. Charles, which is scheduled to open in the fall of twenty twenty five and the Cadence Crossing development here in Las Vegas expected to be complete in mid-twenty twenty six.
As these projects come to conclusion, we expect to begin the next round of projects, including potentially replacing our 30 year old riverboat at Paradise. And finally, we are beginning work on our casino resort development in Virginia with estimated capital spending of $150,000,000 to $200,000,000 in 2025. The total investment in this project related to the development of the temporary and permanent facilities is estimated to be $750,000,000 The temporary facility is on track to open in November of this year, while the permanent resort is scheduled to open in late twenty twenty seven. To summarize our capital plans for 2025, we estimate maintenance related and property growth capital of $450,000,000 and an additional $150,000,000 to $200,000,000 for Virginia, resulting in total CapEx for 2025 of approximately $600,000,000 to $650,000,000 In addition to these investments, we remain committed to returning capital to our shareholders. We paid a quarterly dividend of $0.17 per share during the fourth quarter.
Also during the quarter, we repurchased $2.00 $3,000,000 in stock at an average price of $71.79 per share, acquiring 2,800,000.0 shares. When combined with our share repurchases with our dividend program, we returned nearly $750,000,000 to our shareholders during 2024 or more than $8 per share. As of year end 2024, we had $640,000,000 remaining under our current repurchase authorizations and the actual number of shares outstanding at year end was 86,200,000.0 shares. Since October 2021, we have returned nearly $1,900,000,000 in capital to our shareholders in the form of share repurchases and dividends, reducing our share count by more than 23% over that time period. We ended the quarter with total leverage of about 2.5 times and lease adjusted leverage of about 2.9 times.
We have no near term maturities, strong free cash flow supported by a diversified portfolio of assets and ample borrowing capacity under our credit agreement, continuing to place our company in the strongest financial position in our history. Transitioning to our 2025 outlook and our Las Vegas local segment, we expect stability will return to the Orleans and Gold Coast during the second half of the year as we fully anniversary competition. We expect the other properties in our local segment to perform slightly better than the overall locals market, consistent with the 2024 performance of these properties. In Downtown Las Vegas, we expect growth during the year in line with the downtown market. In our Midwest and South segment, we expect to benefit from an incremental five months of the Treasure Chest expansion, which opened in June of twenty twenty four.
For the remaining properties in this segment, we expect results similar to 2024. For the first quarter, it’s worth noting this segment has been impacted by poor weather conditions throughout January, similar to the first quarter of twenty twenty four. Beyond our expected performance for these three segments, with the continued success of investments like the Fremont and Treasure Chest, our pipeline of investments continues to strengthen our EBITDAR and position us for future growth. David, that concludes our remarks. We’re now ready to take any questions.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you, Josh. We will now begin our question and answer session. Our first question comes from Steve Wazinski of Stifel. Steve, please go ahead.
Steve Wazinski, Analyst, Stifel: Yes. Hey guys, good afternoon. Hey Keith and hey Josh. So without giving formal guidance for the full company, Josh, you have given us some high level guidance around certain parts of your around certain parts of your business. And just wondering if you can maybe help us again from a high level help us understand how you’re thinking about maybe your core customers versus your retail customers in 2025?
Just I guess just trying to understand how you’re thinking about both of those segments. And I would assume stability is what you’re going to say, but I wanted to ask that question anyway.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Yes. So thanks, Steve. I’ll take a shot at it. I think what we’ve seen really very consistently is our core customer has been really growing. And so we would expect that customer segment to continue to grow.
In terms of retail, I would divide that customer into really two parts of our business, one in Las Vegas and one outside of Las Vegas. The retail customer for us in the markets outside of Las Vegas have largely been stable, meaning bouncing around flat year over year in terms of growth for probably the better part of a year, if not longer. So we’re really poised for that set that part of the business to convert or pivot to positive at some point, although it hasn’t at this juncture. And I think that’s probably more reflective of the broader economic issues facing that customer segment. In terms of Las Vegas, throughout 2024, what we’ve seen is what I would call it stabilizing of impact or stabilizing or recovering kind of performance from the retail customer, meaning getting less bad year over year sequentially.
So year over year, the declines are getting less bad sequentially as we move through 2024. And I think as we look through to 2025, we would expect us to really kind of start to reach more stability, maybe still be down a little bit in the second half of the year, but once we fully anniversary the competition. I don’t think we will start to see growth in that segment in 2025. Our best opportunity for that would be in the second half, but I’m not sure if we’ll get there this year or not. It will depend on things that are a little bit out of our control.
Keith, I don’t know if there’s anything you want to add to that.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: No, I think that fairly summarizes where we’re at with core and retail.
Steve Wazinski, Analyst, Stifel: Yes, that’s perfect commentary. Thanks, Josh. And then second question again, maybe trying to dig in a little bit more towards guidance and I apologize, but maybe help us think about flow through in 2025 or a better understanding of how you’re thinking about maybe some of the headwinds or tailwinds that you might be starting to encounter on the margin front as well? And then Josh real quick a housekeeping question in terms of how you’re thinking about corporate expense for the year would be helpful as well. Thanks.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Yes. So I’ll take a shot at this. In terms of flow through in margins, look, I think from an expense perspective, we continue to see expense pressures, but nothing like what we’ve seen kind of over the last several years. So I would stick with the theme of expenses moderating, while still a bit challenging. I think overall things continue to trend in a direction that’s favorable from an expense perspective.
And what we really need to start seeing is kind of better revenue growth from primarily that retail segment that we spoke about to get to kind of enhance our flow through. But I think we’re at a period of time where we can manage our margins fairly effectively in this environment absent any significant change in our customer spend behavior. And I think that applies really across our portfolio.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes. I think you’ve seen margins fairly consistent recently and that’s what you should think about as you think about 2025. So again the LVL apps in Orleans and Gold Coast exceeding 50% margins in the MSR being consistent at 37%. And as Josh said, some of the most expenses are moderating and we’re able to manage through it. So we should think about 2025, think about consistency.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Yes. And I think overall, if you look at our property level margins, they’ve been consistently above 40% really since COVID. So we’ve been managing through all of the challenges while maintaining very healthy margins that I think people were skeptical that we’d be able to maintain. And I think we’ve after four years would hopefully have built some confidence that we can manage and deliver this level of performance consistently. You asked about corporate expense and I think for 2025, I would build in about a 3% to 3.5% kind of growth in corporate expense.
We do have kind of a one time item in 2025 where we’re making some larger donations that will hit corporate expense. And so I think a good number for this year is about $95,000,000
Steve Wazinski, Analyst, Stifel: Okay, great. Appreciate the color. Thanks, Josh.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you. Next question comes from Barry Jonas with Truist Securities. Barry, please go ahead.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Hey guys, online was ahead of our expectations even when factoring the one timers. Just curious, did the poor NFL hold in the quarter flow through to you guys at all or were just other elements of growth enough of an offset? Thanks.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: I think the answer to that is yes and yes, that we certainly were impacted in the online space by the lower hold during NFL season. At the same time, we saw good growth in the business and good growth from our market access agreements as well as some growth from our small but growing online gaming business.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Understood. And then just as a follow-up, Keith, there’s lots of activity these days on the legislative front. As you look at states discovering the discussing gaming, curious where do you see the greatest risks and maybe opportunities from Boyd’s perspective?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes. Look, as you look across the landscape, it’s early in the season. There’s lots of gaming bills out there. We’re monitoring all of them and paying attention. It’s really hard to judge a month into most of these sessions.
Someplace like Louisiana hasn’t gone into session yet. And so we’re monitoring them. It’s early. We’ve been through this for a lot of years. And so we’ll just have to see what happens, but I don’t really have any other comments beyond that.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Understood. All right. Thanks so much guys. Nice quarter.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Thank you.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you. Our next question comes from Carlo Santarelli of Deutsche Bank (ETR:DBKGn). Carlo, please go ahead.
: Hey guys. Thank you for taking my question. Josh, you talked a little bit about regionals kind of bouncing around a little bit for the last year on the same store basis. And obviously the last few months, fourth quarter specifically did look better from at least what we see from a GGR perspective, certainly kind of showed through in your net revenue and Keith’s comments about what the same store portfolio did. But then I guess taking your commentary around 2025, it kind of sounded as though you were insinuating a flattish year over year same store kind of EBITDA trajectory.
Am I interpreting that right? And then secondly, is there anything that’s kind of hindering your willingness to maybe talk about an improving trend line in 2025?
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Yes. So I think your interpretation is correct. I think for those of you who remember and follow along, we had what we thought was going to be a challenging comparison to Q4 of last year with all the one time benefits that we had then that we didn’t get the benefit of this year. And I think we had a little bit better performance out of treasure chest than we expected in Q4. And we also had a little bit better performance throughout the portfolio quite honestly than we expected.
I think what when we remain cautious because I don’t think we’ve seen enough of strength in primarily the retail segment given my comments earlier to say that they have pivoted to contribute to sustainable kind of a growing segment. Now maybe that will happen, but that’s not what we’re seeing in the customer trends at this point. We’re seeing just more I’m trying to think of how to describe more consistency in their play that’s not pivoting to consistent growth, if that makes sense. So that’s the hesitation to kind of get excited about what was a little bit better quarter than maybe what we expected from the Midwest and South.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Look, Carla, I think it’s just our natural hesitation to go think about the entire year go too far on a limb at this point. There’s a lot of things that can go on. We think it will overall be a better year, but there’s nothing that jumps out at you that says you should predict something significantly greater.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: And I know this isn’t related to your question, Carlo, but I just want to remind people, January so far in the Midwest and South has been very similar to January of last year with the weather. So not that that’s an answer to your question, but I’m just saying don’t forget that.
: Understood. And if I could just a follow-up, obviously you guys, last three quarters have kind of stepped up the buyback to over $200,000,000 very steady at $100,000,000 a quarter. And I think that the refrain has always been at least $100,000,000 a quarter, but certainly have gotten more aggressive with your buyback activity. And when you couple that with kind of the elements of the development pipeline, the CapEx that you’re spending on the rumor models, clearly the other projects that you talked about, Virginia Cadence and then potentially Illinois getting started later. Where does within the context of any kind of M and A or asset acquisitions portfolios that you might be looking at, where do you guys how do you guys kind of frame the returns on the capital that you’re spending relative to something that you might do outside of the company?
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Yes. So I think it’s strictly an evaluation of the alternatives that we have in front of us based on the returns that they will generate. If we didn’t have good projects like the treasure chest for instance or some of the projects that we’re pursuing for as part of the recurring property growth investments, we wouldn’t be doing them. We’d be investing more in returning capital to shareholders. So it’s really a balance of where we can get the best returns.
And we’ve mentioned before, we have a pipeline of projects. We have plenty of projects to choose from. We have to choose the best ones that have continued to generate superior returns. That’s why we try to do it in the manner that we’re doing it, weigh that against repurchasing shares. And then if another opportunity, whether it be greenfield development or acquisition, it’ll just be evaluated in the same context.
It will have to be a compelling opportunity relative to either investing in our portfolio or buying back shares.
: Understood. Thank you, Josh. Thanks, Keith.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Sure.
Dan Politzer, Analyst, Wells Fargo (NYSE:WFC): Thank you.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Our next question comes from Jordan Bender of Citizens JMP. Jordan, please go ahead.
Jordan Bender, Analyst, Citizens JMP: Good afternoon, everyone. Good to hear about the outperformance in the locals market. It’s been a little bit tougher to decipher what the true growth in the locals market has been with all the new competition. So without kind of getting into 1Q guidance, can you maybe help us with what that extra rate actually kind of looks like? And more specific to you guys, what would you contribute the outperformance that you’re calling out versus the overall market?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: If you cut out for one second there, if you could re ask your question, I apologize.
Jordan Bender, Analyst, Citizens JMP: Yes. I guess it’s been just a little bit tougher to decipher what the true underlying growth of the locals market has been with all the competition. So can you just kind of help us with what the exit rate is for the locals market into the New Year? And then I guess more specific to you guys, what would you contribute your outlook of outperformance versus the market to?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: I think in terms of look, our own performance and our outperformance versus kind of what we call the same store market in 2024, I think it’s a combination of having some refreshed product, good marketing programs and just a good overall operation. The promotional environment here in Las Vegas has remained fairly stable and we’ve remained very disciplined on that front. As we talked about in our prepared remarks, we’ve seen good growth from our core customers and continued steady growth from that group and some stability, as Josh talked about, amongst the retail customers. In terms of kind of the exit rate of growth in the LBL as you think about 2025, that’s a it’s kind of tough to predict. Is it low single digits?
Probably, if you were to depending on your estimate of where the new competitor how much revenue the new competitor generated on a quarterly or annual basis throughout 2024, you were to subtract that out of the market, I think what you’d be looking at is a market kind of growing in that low single digit range. So I think that continues into 2025.
Jordan Bender, Analyst, Citizens JMP: Helpful. And on the follow-up, any sense of what the Paradise move to land would cost you guys?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: No, we’re still in the design phase. I mean, it’s you think about your treasure chest, which we quoted in the $100,000,000 range, it’s probably something similar. It’s not significantly larger or smaller.
John DeCree, Analyst, CBRE (NYSE:CBRE): Great. Thank you very much.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you. Our next question comes from David Katz of Jefferies. David, please go ahead.
David Katz, Analyst, Jefferies: Hi, afternoon. Congrats on your quarter. Look, I also wanted to go back to some of the capital allocation on the M and A side, right, because I know we’ve had conversations about properties, smaller companies, larger companies, that it’s a pervasive thing. And so the follow-up really is, how do you think about risk tolerance, leverage take on and opco, propco versus owned and operated, a little insight there would help. Thanks.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: I don’t think our views on this have changed much over the years. We certainly prefer to purchase HoldCo as opposed to OpCo, but in today’s world, most of what we have the opportunity to buy are OpCo. So it doesn’t discourage or dissuade us from looking at an asset because it’s in that structure. Once again, preference to buy HoldCo. In terms of leverage, we’ve talked about this in the past.
We are flexible with our leverage profile, I. E, allowing leverage to float up for an acquisition as long as we can see it return to a level that we wanted to return to. So as long as we can see a way to delever quickly, then we’re okay with lever letting leverage float back up. And I would say that over the years, once again, we’ve developed a good discipline when it comes to M and A or acquisitions. I think we’ve developed quite an expertise.
And look, it’s got to be, first of all, a good strategic fit in the right market. It’s got to be the right sized assets. It’s got to be high quality asset. And that’s kind of not a different set of facts today than it’s been over the last, I don’t know, several years. So that’s when we think about M and A, we think about leverage, we think about OpCoPropCo versus WholeCo.
Once again, I think it’s consistent over the last several years, but that’s how we think about it.
David Katz, Analyst, Jefferies: Got it. Thank you very much.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you. Our next question comes from Brent Montour of Barclays (LON:BARC). Brent, please go ahead.
Brent Montour, Analyst, Barclays: Hello, everybody. Thanks for taking my question. So I wanted to circle back on the sort of post election trends question. And if you look at the Midwest and South regions that weren’t affected by weather, was there sort of anything encouraging at all? I mean, we have seen sort of an incremental lift across many of our other sectors demand being called out just with consumers feel that a little bit better.
Any excess foot traffic or spend per visit or anything that you did see that was encouraging?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Look, I think it’s always we’ve said this in the past, it’s always hard to discern kind of from a consumer standpoint, what is motivating them to come out and participate in our business? Is it a pre election, post election phenomena? Were they maybe less coming out less frequently pre election and they came out more post election? Was the revenue growth in the markets kind of across the board? Was it a little stronger post election than pre election?
Yes, I think it was, depending what markets you look at. But for the most part, yes, it was stronger in the fourth quarter. Is that a matter of the election? Is that a matter of consumers feeling better? Is that a matter of higher paychecks?
Always hard to sort through that. But clearly, the facts are, yes, a little more growth in our markets in the fourth quarter than in the third quarter. Could be seasonality, hard to discern. But does it feel like the consumer feels a little bit better today than they did earlier in the year? I don’t know, maybe a little bit, but not materially,
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: but not enough to take it and run with it, I guess, is what we’re trying to say.
Brent Montour, Analyst, Barclays: That’s really helpful guys. A follow-up I have is on the Paradise project, and just sort of comparing it to treasure chest, which you did with the build cost, and I appreciate that. But just digging into sort of the qualifying aspects of that project, when you think about treasure chest, which was a slam dunk, there were had a sort of a built in market in its area and you were taking out a ton of friction when you took it from the boat to land. I’m just curious if there’s a similar sort of natural factor in that project that will get you this sort of immediate lift? And then if there’s other factors in that market we should consider when we think about a comparable IRR?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Generally outside of development costs for the Paradise project, comparing it to Treasure Chest, I’d encourage you to completely separate the two projects. The market dynamics are completely different. The populations in the areas are completely different. The level of competition surrounding Paradise with all the build costs, all the dynamics will be different. Will we, I.
E. Save money, is there less friction going from a riverboat operation to a non riverboat operation? Yes, absolutely. But the dynamics other than that will be completely different. I think we were all surprised just to be clear about the level of pickup at treasure chest.
We expected a great return. We didn’t expect to double revenues or have revenues be up kind of 80% pre project. So I think that’s been a home run and I would not factor that into a Paradise development.
Brent Montour, Analyst, Barclays: Loud and clear. Thanks, everybody. Nice quarter.
Dan Politzer, Analyst, Wells Fargo: Thank you.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Next question comes from Dan Politzer of Wells Fargo. Dan, please go ahead.
Dan Politzer, Analyst, Wells Fargo: Hey, good afternoon. Thanks for First one, this is really local centric, but it could relate to Midwest and South as well. The current administration, they proposed reducing or eliminating taxes on tips and more recently overtime pay and Social Security payments. This seems like it would play right into your sweet spot, but perhaps you can put some numbers around any of this impact if you think it might be incremental to your business, either from a cost or a revenue standpoint.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Okay. Obviously, it’s a statement of the obvious, but I’ll say it anyways, which is, look, it all depends on what shape a build takes and what the exact guardrails are and parameters or specifics are of any bill that gets passed. Clearly, any if a local consumer, whether it be here in Las Vegas or or once again, we deal largely to locals throughout the country is healthier, whether there are lower taxes on their income, it will support our business. We will benefit from it. What does that translate to in terms of dollars?
Couldn’t begin to tell you. Is it millions of dollars? Yes. How many? One to ten, ten to 20?
Actually don’t know because it all depends on what that bill looks like. But it will be incremental to the business as we think about the business today.
Dan Politzer, Analyst, Wells Fargo: Got it. Yes. I get it’s still early, but it’s something worth asking. And then just pivoting back to the balance sheet, Net leverage, it sounds like it’s going to be up from I think year end you said about 2.9% just given the CapEx you’ve laid out and kind of the EBITDAR expectations. I guess as you think about buying back stock and organic growth opportunities maybe versus M and A, is there a threshold or through or a leverage target through which to think about?
And maybe along with that, is there a scenario where clearly your stock has been performing well, where you consider using that your stock as a currency in an M and A transaction?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes. Look, in terms of how we would fund an M and A transaction, it’s all very fact specific and I won’t comment on it. We historically have not used our equity as currency, but it’s all very fact specific. In terms of leverage, I said a little bit earlier that we would be very accommodating from a leverage profile standpoint for the right acquisition to allow leverage to go up. So as long as we could see it coming down in the future, that remains true.
Look, we’re fairly disciplined in terms of looking at assets in terms of M and A and it’s going if we find the right asset and we find the right opportunity, we’re likely to execute. But Josh talked earlier about we look at share buybacks and the return we get from that. We look at returns from our internal investments. So we look at M and A and we try and balance it all. We talk about this balanced approach to capital allocation.
It’s not investing in any one thing or allocating it in any one place. It’s trying to allocate it across the board so that we have a very strong foundation to continue to grow from. So it’s the best I can do. Josh, you want to add?
David Katz, Analyst, Jefferies: The only
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: thing I was going to add, Dan, you mentioned the $2,900,000 that you referenced was lease adjusted leverage. We said current leverage is about 2.5 today and lease adjusted leverage today is 2.9 times. I didn’t say that it was going to 2.9. Yes, I just want to be clear. Yes.
Dan Politzer, Analyst, Wells Fargo: Got it. Thank you.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Thanks, Dan.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you. Our next question comes from Sean Kelly of Bank of America. Sean, please go ahead.
Keith Smith, President and Chief Executive Officer, Boyd Gaming0: Good afternoon, everyone. Josh or Keith, most of my questions have been asked and answered, but a couple of small ones. First of all, on Norfolk, if we could, obviously, a bit more color on the temp facility timing, but could you just help us out there with scope and scale of that project in terms of position count or just kind of how we should think about it? And maybe also just any plans around ramp up or marketing, just given the size of what you’ll start with there?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes. So here’s how I think about it. It’s actually pretty simple. So, once again, the cost of it is built within the $750,000,000 overall project cost. The timing is November of this year and from a financial return standpoint or incremental EBITDA standpoint, you should assume zero.
It will be a small modest facility and you should just assume it’s breakeven. It might be slightly positive, might be slightly negative, you should assume breakeven.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Because we’re basically at the same time going to be focused on building the ultimate project. That’s why it’s small to start with.
Keith Smith, President and Chief Executive Officer, Boyd Gaming0: I mean, sorry, just maybe to push on that for a moment then, like what would be the point of doing it if the contribution was zero? Is it a requirement to get something open and operating as a part of the development agreement or something?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes. As part of the overall development agreement, we’ll be opening a temporary facility or a transitional facility.
Keith Smith, President and Chief Executive Officer, Boyd Gaming0: Okay. That’s helpful. Thanks for that. And then second follow-up would just be just going back to Treasure Chest and obviously the property has been a big success, but there was some concern as particularly as New Orleans opened up some incremental improvement there that perhaps you’d see a little bit of spillover, a little bit of impact. Have you observationally seen anything?
I mean, we’ve obviously got access to some of the state level reported data, but just as you look at it, has the run rate cooled off there at all or have you been generally impressed by the levels or seen any change in behavior as that asset started to stabilize?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Josh will not be happy with this comment. Actually, our Q4 performance from a revenue standpoint was better than our Q3 performance. So I think maybe whatever went on in Downtown New Orleans assisted us overall.
Keith Smith, President and Chief Executive Officer, Boyd Gaming0: Okay. Set the bar low then. Thank you very much.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you. Our next question comes from Joe Stauff of Susquehanna. Joe, please go ahead.
Keith Smith, President and Chief Executive Officer, Boyd Gaming1: Okay. Thanks, Keith. Josh, I had a question on the renovation sleeve of your CapEx outlook, $100,000,000 dollars and wondering similar to your project CapEx sleeve of $100,000,000 is that should that also be something that we assume you’ll continue, say, going forward? And then I was wondering if you just kind of comment from your perspective in terms of your where are you seeing regional competitive pressure in terms of what markets? I mean, certainly we can see, we can guess, but I was just wondering from your perspective, where you see the bigger sort of impacts from competitive pressure.
I think you answered one of them right in Sean’s question thus far, but I was wondering if you can comment on the other areas.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Look, I’ll answer the last question as Josh talk about the CapEx side of your question, but from a competitive standpoint, the promotional landscape, the competitive landscape has been fairly consistent for 2024. We don’t see much change in 2025. Look, there were some new additions, some new supply additions in Northern Illinois that impact Iowa a little bit. And there’s a project in Eastern Illinois outside of Chicago that potentially impacts Northwest Indiana. It’s early.
But so we’re watching those. None of those have had a significant impact on us. And as we think about, is there a market where we’ll see larger competition than another market? No. Once again, the New Orleans market, our treasure chest operation continues to perform at a very high level.
Can’t speak to what else is going on in the market there, but we’re continuing to do well and everything seems pretty stable.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Yes. I think we’re pretty well I mean, what Keith’s comments are saying is we’re pretty well insulated from competition in reality, at least for the foreseeable future. I think from the just to clarify on the $100,000,000 room refurbishment projects that’s you can think of that as we’re catching up coming out of COVID capital kind of stuff. And so when we started talking about that, we said it was going to be $100,000,000 in 2024 and $100,000,000 in 2025 and then it would go away. The way it’s playing out is we actually spent less in 2024.
That’s going to be what gets shifted out to 2026 and that’s why we think it will be done in mid-twenty twenty six. So to the extent we’re able to hit the $100,000,000 that we expect to spend this year, then there’ll be another $50,000,000 in the first half of next year and then that’ll be done. To the extent that for some reason, because it takes us longer or whatever, and we don’t spend the full $100,000,000 you’ll see that roll over. But we’ve got the projects identified, we’ve got the budgets identified, it’s $200,000,000 It’s just really spread over what time period that we execute on those. So that’s that.
And then that’s not to be confused with the $100,000,000 we spend every year or that we started spending every year for the growth projects like Fremont, Treasure Chest, meeting space at Ameristar St. Charles, Cadence Crossing and then eventually Paradise and others to come. That’s a recurring $100,000,000 of growth capital.
Keith Smith, President and Chief Executive Officer, Boyd Gaming1: Understood. Can I squeeze one more in how to think about just the potential construction disruption in the locals market from your Suncoast projects as well as Orleans?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes. I think
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: we there could be some. I mean that is a risk to any commentary that we talk about. It’s an elaborate surgery on an operating live gaming operation. And so we’ve done this before downtown, where we take little bits and pieces of the casino floor and work our way across it. And there will be some periods of time where we have disruption to our operations.
At this point, we’re not we’re planning to mitigate that and we’re not planning for disruption, but life will happen and we’ll let you know when that does happen. But the reason we call out the hotel rooms is not only so that we got capital is because every once in a while we run into unexpected issues with those as well. So again, we’re not expecting, we’re trying to plan around it, but some of these buildings are really old and you have to take out more of a tower than you expected. And we’ve encountered that before and those who followed us have learned with us as we’ve experienced that. So we’re trying to let you know what we’re doing.
And so if something goes awry, you go, okay, that kind of makes sense. It’s not a surprise and we’ll be surprised by the disruption when you guys are surprised by it. So that’s kind of what we’re trying to do here.
Keith Smith, President and Chief Executive Officer, Boyd Gaming1: Okay. Thanks a lot.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you. Our next question comes from John DeCree of CBRE. John, please go ahead.
John DeCree, Analyst, CBRE: Hi, Josh. Hi, Keith. Thanks for taking my question. Maybe shift gears to the online business a little bit. I know we covered a lot of ground already, but Josh, give us really good detail on CapEx and investments for the upcoming year and even into 2026.
So curious if you have much plans for investing in the online business this year, particularly your kind of iGaming business. I know you gave us EBITDA guidance, but curious if there’s any kind of OpEx investments in that. And then I guess the bigger picture question is what would you need to see in that business to kind of push more investment dollars to the iGaming business? Is it more kind of state legislation? Or just kind of how you think about investing in iGaming over a multiyear period?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: I think we’re very pleased with the platform we have. It is scalable. And so as other states legislators begin to consider this and potentially approve this, it’s not going to require significant CapEx to do anything to scale up to take advantage of those opportunities. I think we’re happy with kind of the platform we have and where it’s at, I would not assume any significant CapEx in that business and it will continue to have, I think, modest growth going forward and will accelerate probably only when other states begin to legalize this product.
John DeCree, Analyst, CBRE: Understood. Thanks, Keith. And if I could sneak one more in, probably not a ton for you to add. It’s more of a strip phenomenon. I’m curious if you’ve seen any business differences in the locals market during F1 this year, whether it be just less disruption or different levels of visitation?
And then similar question about expectations for Super Bowl this year, if you expect any meaningful variance in your business volumes in the locals market?
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes. So I think we should think about F1 last year. The programming in the city was different. So it’s maybe hard to unpack it because there was a Raiders game in town, Raiders played Denver that weekend. And so there was more demand, there was more demand for hotel rooms, there was different customer in town, which was good, because the prior year the town just didn’t fill up to the extent it was expected.
Look year over year, room rates were down during the F1 timeframe because the rational exuberance as they say from year one of F1 kind of subsided. So it was a little less disruptive, but it still takes months to put that together, which disrupts the Strip and still takes more than a month to tear it down, which disrupts the Strip. In terms of Super Bowl, I think what you want to think about is Super Bowl is always a great time in Las Vegas, always one of our busiest weekends. I’m not sure room rates will be quite as high year over year. I think room rates will be down year over year from a Super Bowl standpoint.
Town will still be full. It will still be a very strong weekend for us just on the non gaming side, maybe not quite as robust as it was last year.
John DeCree, Analyst, CBRE: That’s great. Thanks, Keith. I appreciate all that color and Congratulations to you all on the big milestone anniversary.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Thank you. Thank you.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Our final question comes from Chad Beynon of Macquarie. Chad, please go ahead.
Keith Smith, President and Chief Executive Officer, Boyd Gaming2: Hi, good afternoon. Thanks for taking my question. Just one for me. Josh, you talked about the Managed and Other segment in 2025 essentially being flat year over year. Obviously, trees don’t grow to the sky, but this has been one of the higher growth areas of your company.
And I know there’s a Phase one and a Phase two. So should we assume that you might just be being a little conservative, given all the volatility in the market in terms of this property growing? Or is there something else in the database or competition or maybe disruption with Phase one, that should kind of limit some of the growth that we’ve seen in the past couple of quarters? Thanks.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: Yes. One of the things that limits growth is it’s a very high performing property. As we sit here today and there’s only so many people you can put in that building on a weekend, which is when most the business is generated. And so there are just natural limitations. We cannot add capacity to the four walls we live in today.
And therefore, just growing that business much beyond what it is today is very difficult from a physical standpoint. It is at capacity on weekends, on holiday weekends, just almost every weekend. So it’s a physical limitation as much as anything.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: I think the next opportunity for growth to the point you made, Chad, is once the Phase one is done and we get that up and running and work all the kinks out, but that’s probably a 2026 sometime in 2026 kind of contribution.
Keith Smith, President and Chief Executive Officer, Boyd Gaming: It’s not disruption from the project. The project is largely outside the existing four walls.
Keith Smith, President and Chief Executive Officer, Boyd Gaming2: Okay. Thank you, both. Nice quarter. Appreciate it.
David Strow, Vice President of Corporate Communications, Boyd Gaming: Thank you. This concludes our question and answer session. I’d now like to turn the call over to Josh for concluding remarks.
Josh Hirschberg, Executive Vice President and Chief Financial Officer, Boyd Gaming: Thanks, David, and thanks for everyone joining the call today. If you have any follow-up questions, feel free to reach out to the company.
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