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Station Casinos grew revenue 8.3 percent in the fourth quarter, helped by the opening of its $800 million Indian casino in Northern California.
The casino operator hopes its online gaming component, through its 57 percent ownership in Ultimate Gaming, will soon contribute to the bottom line as well.
During the fourth quarter, which ended Dec. 31, Station Casinos increased revenue to $328.4 million.
The company, which operates large and small casinos in Southern Nevada, said 2013’s net revenue was $1.3 billion, an increase of 2.6 percent.
Station Casinos said its net income in the quarter was $26.2 million, compared with a net loss of $9.8 million a year ago. The company is not publicly traded but has publicly owned debt.
Station Casinos’ adjusted cash flow grew 11.2 percent in the quarter, the 11th-straight quarter the metric has shown an increase. In a statement, the company said the cash-flow figure is not a generally accepted accounting principle, but it believes it is used to measure operating performance in the gaming industry.
Station Casinos Chief Financial Officer Marc Falcone estimated more than $8 billion — the most since 2007 and 2008 — is being invested in Las Vegas-area projects, which will help boost the local gaming market. He said improvements will be made to Red Rock Resort to bring in more foot traffic from the nearby Shops at Summerlin, which are expected to open by the end of the year.
During a conference call with analysts, online gaming was the focus. Through Ultimate Gaming, Station Casinos operates in both Nevada’s online poker market and New Jersey’s Internet effort. The company did not release any financials for online gaming, but said both markets have gotten off to slower than anticipated starts.
“We are still optimistic that there is opportunity for growth,” Falcone said.
In New Jersey, where Ultimate Gaming operates the online wagering presence for Trump Taj Mahal, Falcone said payment processing and geolocation issues have slowed development.
The results of a poll the company conducted in New Jersey found that “a very low percentage of the residents are even aware that online gaming is now legal in New Jersey.”
Falcone said Ultimate Gaming will step up its marketing efforts in both states.
Nevada regulators have not released online poker numbers. According to New Jersey gaming officials, the Trump Taj Mahal has produced $1.44 million in online gaming revenue through February, fourth-highest of the six online gaming sites.
The Nov. 5 unveiling of the Graton Resort, which the company operates on behalf of the Federated Indians of Graton Rancheria, was worth almost $15 million to the company in the quarter. Station Casinos received a one-time development fee of $8.2 million and recorded $6.5 million in management fees related to the Northern California property in the quarter.
Falcone said Graton, 45 minutes north of San Francisco, added 500,000 names to its customer database “and we are gaining momentum with increasing visitation from those guests through our marketing initiatives.”
(c) 2014, Stephens Media LLC