Golden Entertainment(US:GDEN)2021-03-12 02:16Financial Data and Key Metrics Changes - The company generated over $200 million in revenue and almost $40 million in EBITDA for Q4 2020, despite increased restrictions [7] - Fourth quarter EBITDA for Las Vegas local casinos increased more than 21% year-over-year, with a margin improvement of over 1,000 basis points [9] - The overall EBITDA for combined casino operations, excluding the Strat, grew nearly 3% with a 670-basis point margin improvement [10] Business Line Data and Key Metrics Changes - EBITDA for Laughlin casinos was lower, but the EBITDA margin improved by over 700 basis points [9] - Pahrump casinos saw a more than 14% improvement in EBITDA with a 650-basis point margin improvement [9] - The distributed business in Nevada improved EBITDA by 2.5% year-over-year, driven by the Tavern portfolio [11] Market Data and Key Metrics Changes - The company reported that occupancy at the Strat fell from about 50% in October to just about 30% in December due to restrictions [10] - January and February showed better performance compared to November and December, indicating a potential recovery [8] Company Strategy and Development Direction - The near-term focus is on improving operational performance while prioritizing free cash flow for debt reduction [12] - The company aims to capitalize on future opportunities such as sports wagering in Maryland and expansion of distributed gaming in new jurisdictions [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence that January and February were better months, suggesting that December was the low point for operations [8] - The company is optimistic about returning to 2019 EBITDA levels and exceeding them, with a target of generating over $3.50 per share in free cash flow [12][29] Other Important Information - The company has a strong liquidity position with over $100 million in cash and no borrowings on its revolving credit facility [11] - Management indicated that they did not need to raise dilutive equity or debt during 2020, maintaining a stable capital structure [11] Q&A Session Summary Question: How did January and February compare to October in terms of EBITDA? - Management noted that while October was a strong month, January and February are trending higher than 2019 levels [15] Question: What are the criteria for returning capital to shareholders? - Management stated that they would consider returning capital as they approach 2019 levels and generate cash in the latter half of the year [16] Question: How is the older demographic responding to the current environment? - Management observed that the 65 and older demographic is beginning to return as vaccinations increase, with spending per visit up by about 25% compared to pre-COVID levels [34][38] Question: What is the outlook for the Strat and its recovery? - Management indicated that while conventions benefit all properties, the Strat is not reliant on them and is well-positioned for recovery through drive-in business [40]