reported a sharply higher third-quarter profit but just narrowly beat Wall Street estimates as its investment in the Borgata Hotel Casino and Spa in Atlantic City continued to pay off.
The Las Vegas company announced third-quarter net income of $35.5 million, or 40 cents a share, up from $7.7 million, or 12 cents a share, in the third quarter of last year.
Excluding all items, which is the way Wall Street views the company, Boyd reported adjusted earnings of 38 cents a share, a penny better than the average analyst estimate, and up from 15 cents a share a year earlier.
On Tuesday, before Boyd released earnings, its stock traded down 31 cents, or 1.1%, to $29.
Revenue came in at $522 million, up 68% from $311 million a year ago, and better than the $514 million Wall Street consensus. Revenue from stores open a year ago was up 3.6%. Earnings growth was fueled by the Borgata, which is a joint venture between Boyd and
Boyd said the casino took in net revenue of $186 million, up 24% from a year earlier. Average daily table win was $4,198, beating the second-place property in Atlantic City by $525. The Borgata posted EBITDA (earnings before interest, taxes, depreciation and amortization) of $63.1 million, more than double the $30.5 million from a year earlier, when there were high expenses relating to the casino's opening.
Boyd said the Borgata expansion plan announced in its last earnings release was "on track." With business so strong at the property, Boyd also announced a second expansion plan. Construction on the second plan is scheduled for completion in mid-2007. The centerpiece of the latest plan is a new hotel tower containing about 800 guest rooms, suites and resort condominiums. The plan also includes a new spa, additional meeting rooms and two swimming pools.
"Looking at properties that we have operated in both this year's and last year's third quarters, only two, Delta Downs with construction disruption and the California with a rooms remodel, had comparatively down quarters," said William Boyd, the company's chief executive, in a news release. "Every other property exceeded prior-year EBITDA results in the quarter. Coast is not only growing revenues and earnings at an excellent rate, it is turning out to be a great fit with our company. ... Borgata's performance in its start-up quarters has been exceptional."