Full House Resorts, a small Las Vegas-based regional casino company, said despite limited offerings due to COVID-19, its Silver Slipper property in Mississippi had the best month in its 14-year history in June on several metrics.
Cash flow at the property was up 28 percent compared to June 2019, according to a Thursday statement from the company, despite only half of its slot machines being operational.
CEO and president Dan Lee said cutting costs in marketing, payrolls and other amenities has improved margins.
“At this point, we’re not only surviving, but thriving,” said president and CEO Dan Lee. “(The shutdowns were) a good opportunity to take a fresh start, get rid of the sacred cows, and reexamine everything. And we did that.”
Overall revenue at the company, which operates in Nevada, Indiana, Colorado and Mississippi, was $14.5 million in the second quarter, down 65.2 percent compared to last year. Net loss was $6.7 million.
Full House’s five properties closed in mid-March due to the pandemic. It wasn’t until mid-June that all had reopened.
Lee said the properties are still operating under significant constraints.
Table games are not operational in Colorado, and limited in other markets. There are no entertainment or special event offerings that could result in group gatherings, and restaurants have reduced hours and capacity. The company is also operating with about 1,650 machines, just over half of what it had open running in the first quarter.
“It was a bit of a wake-up call,” Lee said. “We don’t actually need that many slot machines. Slot machines are expensive, (and) the casino actually looks better and feels better if you remove some slot machines.”
The company’s regional properties have benefited by having a large drive-in customer base and not relying on resort amenities such as nightclubs or conventions. Lee said the company has seen new customers in recent weeks, many of which belong to a younger demographic.
But there are still challenges: its performance in Northern Nevada slumped after destination travel to the Lake Tahoe region slowed.
The company continues to make operational changes to combat the current environment, reexamining staffing levels and cutting back hours on certain amenities. Offerings such as buffets — which can cost over $2 million a year to operate — and 49 cent breakfast deals will likely never return.
It has also halted construction on a parking garage project at Bronco Billy’s in Colorado to conserve capital.
Despite having roughly $30 million in cash, Lee said the company will remain cautious on expenses in case there are more casino closures.
“We’ll remain cautious on the payroll, on the number of employees, the hours of operations because who knows, things could turn,” he said. “It’s possible, with the (coronavirus) spikes around the country, that we could end up closing again. I think it’s very possible we could end up closing one place.”
Full House shares closed up 19.2 percent Thursday, at $1.68 on the Nasdaq.
Full House Resorts Inc.
Second-quarter revenue and earnings for Las Vegas-based Full House Resorts Inc., a small regional casino company with properties at Lake Tahoe and in Fallon, and in Colorado and Indiana. (Nasdaq: FLL)
2020: $14.5 million
2019: $41.7 million
2020: ($6.7 million)
2019: ($1 million)
Earnings per share