STRAT renovations set up for F1, Super Bowl success
Golden Entertainment’s Third-Quarter Performance Reflects Growth and Strategic Expansion
LAS VEGAS (KLAS) — Golden Entertainment, the parent company of The STRAT and P.T.'s Taverns, reported $257.7 million in revenue for the third quarter, marking a 7.6% decline compared to the same period last year. Despite this, the company is optimistic about the future, thanks to major investments in renovations and exciting new developments set to open soon.
The STRAT: Strong Performance and Renovation Success
The STRAT has seen an 8% increase in revenue, largely driven by the successful completion of a $537 million room renovation project. These upgrades, combined with the Fontainebleau resort opening nearby and the January debut of the $70 million Atomic Golf attraction, position The STRAT to capitalize on upcoming high-traffic events like the Formula 1 race and the Super Bowl.
Charles Protell, president and CFO of Golden Entertainment, expressed confidence that the property’s enhancements will attract more visitors and increase revenue. “The STRAT is now well-positioned to make the most of the increased tourism expected in the coming quarters, driven by marquee events and our newly improved facilities,” Protell shared.
Financial Overview: Challenges and Strategic Shifts
Golden Entertainment reported $53 million in earnings, a drop of approximately $8 million from the previous year. This decline was primarily due to the sale of the company’s Rocky Gap resort in Maryland as part of a broader strategy to focus on its Nevada and Western operations.
Despite the decrease in overall earnings, Golden Entertainment remains financially healthy, with an ongoing restructuring plan to refocus efforts on core assets, including Laughlin’s Aquarius Casino Resort and Edgewater Casino Resort, along with its Pahrump properties and Arizona Charlie’s casinos in Las Vegas.
The company has also completed the sale of its Montana slot routes and is in the process of offloading its Nevada slot route business, strengthening its position for further investment and growth in key markets.
Expansion Plans and the Exciting Launch of Atomic Golf
Golden Entertainment’s commitment to growth is clear, especially with its $70 million Atomic Golf complex slated to open in January 2024. Positioned next to The STRAT, this state-of-the-art golf entertainment venue is expected to boost visitation and increase spending at the resort. Protell noted, “Atomic Golf is a significant development that will complement our existing offerings and create a new, immersive experience for guests.”
The company is also expanding its tavern portfolio, with plans to open four new taverns by the end of 2023 and two more early in 2024. As Golden Entertainment continues to grow its footprint in Las Vegas, the company anticipates a strong return on investment, with the last eight taverns generating a 25% ROI.
Tavern Performance: Navigating Challenges and Driving Growth
While the tavern business faced some challenges—particularly with rising costs and Nevada’s minimum wage increase—Golden Entertainment continues to see promising returns from new tavern openings. The summer months were typically slower, but the company remains positive about the future.
As Protell mentioned, “Our tavern segment remains a key growth driver for us, and we expect to see continued success as we expand our locations across the Las Vegas area.”
Looking Ahead: Strategic Growth and Future Opportunities
Golden Entertainment is moving forward with its strategic expansion plans, focusing on key assets in Nevada, including the launch of Atomic Golf, continued investment in The STRAT, and expansion within its tavern business. As the company consolidates its operations and focuses on core markets, it is poised for future growth, with plans to open more locations and increase revenue across its portfolio.
