Golden Entertainment Q3 2023 Earnings: Financial Highlights
Published on November 5, 2023
Source: Insider Monkey
💼 Executive Summary
Golden Entertainment reported Q3 2023 revenue of $258 million and EBITDA of $53.2 million, reflecting a strong quarter despite recent asset divestitures. Key highlights include:
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$260M sale of Rocky Gap Casino (Maryland)
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$109M sale of Montana distributed gaming business
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STRAT property revenue up 8% and EBITDA up 16%
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Launch of $75M Atomic Golf slated for January 2024
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Stable performance across Nevada local and tavern operations
🏗️ Strategic Divestitures to Boost Liquidity
Golden successfully completed the sale of non-core assets:
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Rocky Gap Casino Resort: Sold for $260M
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Montana distributed gaming operations: Sold for $109M
Proceeds enhanced liquidity by nearly $300M, enabling: -
$175M in term loan repayment
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$2/share special dividend (August)
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$9M stock buyback (September)
Pending sale: Nevada distributed gaming business for $214M—expected to close by year-end.
🏨 STRAT Property Sees Major Renovations & Growth
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STRAT revenue up 8% YoY; EBITDA up 16%
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Occupancy increased to 75% (up from 68%)
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Renovated 537 rooms in Q3; another 119 completed in October
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Positioned to capitalize on major upcoming events like F1 and Super Bowl
🛠️ Note: Room renovations temporarily reduced EBITDA by ~$1M.
⛳ Atomic Golf to Debut in 2024
Golden’s much-anticipated Atomic Golf, a $75M golf entertainment complex behind the STRAT, is set to open in January 2024—expected to further boost visitation and revenue.
🎰 Performance by Region
Laughlin
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Revenue up 6%, aided by a strong event calendar
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EBITDA down 4% due to rising labor costs
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New bingo room and third-party food partnerships enhancing guest experience
Nevada Locals & Pahrump
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Stable revenue and EBITDA
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Las Vegas properties outperformed
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Pahrump impacted by monsoons and road closures
Tavern Operations
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Revenue flat YoY; EBITDA down 9%
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Impacted by July minimum wage hike
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ROI remains strong (25%+) on recent tavern builds/acquisitions
Third-Party Distributed Operations
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Revenue down 9%, EBITDA down 23%
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Impacted by non-renewed contracts, but new location pipeline is strong
💵 Capital Management & Shareholder Returns
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Pro forma net leverage reduced to 2.5x, potentially under 2x post-divestitures
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Continued investment in growth and return of capital:
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$58M special dividend
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$9M share repurchase
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$49M unsecured note buyback
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🗣️ Analyst Q&A Highlights
On California Visitors:
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STRAT not seeing material impact from California traffic, despite I-15 construction.
On Cyberattack Spillover:
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Small, short-term benefit from a competitor’s cyber incident—“not material.”
On Locals Market:
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Las Vegas locals gaming remains strong and growing, bolstered by population migration and healthy local employment.
On M&A Strategy:
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Focused on Western U.S., especially Nevada and Las Vegas
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Prefer real estate ownership and high strategic alignment with current portfolio
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Will consider stock buybacks if valuation remains attractive
✅ Conclusion
Golden Entertainment’s Q3 2023 performance reflects a disciplined and strategic approach to portfolio optimization, capital allocation, and long-term growth. Despite divesting non-core assets, the company maintained solid revenue and EBITDA performance, particularly at flagship properties like the STRAT. The anticipated launch of Atomic Golf, continued reinvestment in core assets, and a robust capital position underscore Golden’s commitment to enhancing shareholder value. As Las Vegas continues to thrive, Golden is well-positioned to capitalize on market growth, expand its footprint, and deliver sustained financial performance.