Station Casinos loses less money in 2010
Station Casinos Inc. reported more red ink on Thursday, but the Las Vegas-based hotel-casino company dramatically reduced its losses in 2010 compared with the previous year.
The company, which has operated in bankruptcy since July 2009, reported a net loss of $565.4 million for the year ended Dec. 31, compared with a net loss of $1.679 billion in 2009.
In 2008, Station Casinos, which owns 18 casinos in Southern Nevada, reported a loss of $3.268 billion.
Net revenues declined last year to $944.9 million, from $1.062 billion in 2009. The company attributed the decline in revenues to the continued economic weakness in Las Vegas and across the United States.
“High unemployment, weak consumer confidence levels and depressed real estate values have continued to negatively impact the economic climate in the Las Vegas area and are expected to continue in 2011,” the company said in a filing with the Securities and Exchange Commission.
For 2010, Station Casinos said casino revenues decreased 8.5 percent to $699.4 million, compared with $764.6 million in 2009.
The $65.2 million decrease in casino revenues last year was “due primarily to a 7 percent decrease in slot revenue and a 30.3 percent decrease in table game revenues.”
Food and beverage revenues decreased 14.1 percent to $163.2 million for the year ended Dec. 31, as compared with 2009 primarily “due to the conversion of several owned outlets to leased outlets.” The number of restaurant guests served decreased 22.1 percent year-over-year for the same reason.
Room revenues for the operator of Palace Station and Red Rock Resort, among others, declined 10.7 percent last year to $73.45 million from $82.28 million in 2009.
“The year-over-year decreases in room revenues … are primarily due to the continued economic slowdown discussed above, and the decreases in room expenses for the same periods are due mainly to lower occupancy levels,” the company said. “Since many of our room-related costs are fixed, decreases in room revenues typically result in decreased margins.”
For 2010, room occupancy for hotel operations was 80 percent. The average daily room rate was $70, and revenue per available room was $56, according to the company’s filing.
The casino company, which caters to local residents, said it lost $176.5 million in the fourth quarter as net revenues declined.
Net revenues for the quarter were $235 million, down from $256.5 million in the same period last year. The company attributed the decline to the recession and high unemployment rate.
The fourth-quarter loss includes a number of one-time items, including an impairment charge of $233 million for the company’s investment in Aliante Station. The results also include a gain of $124.2 million from the conclusion of a real estate venture near Rancho Drive and Palace Station.
As for plans to expand Station Casinos, the company was cautious in its approach.
“Due to the current state of the Las Vegas economy, we have no short-term expansion plans but (we) may pursuer acquisitions,” the gaming company said.
The regulatory filing also confirmed Station Casinos is pursuing reorganization of Aliante Station. According to possible terms of a restructuring, Aliante Station debt holders would receive the equity of the property and a new $45 million credit facility in exchange for their claims.
Contact reporter Chris Sieroty at csieroty@reviewjournal.com or 702-477-3893.
