BYD 1Q REPORT CARD

In an effort to evaluate performance and as a follow up to our YouTube, we compare how the quarter measured up to previous management commentary and guidance.


OVERALL:  BYD beat our expectations and we were way above the Street.  Forward guidance was once again overly conservative and we're surprised investors haven't caught on. 

 

Here is the report card evaluating actual results against management's assertions. 

  • 1Q PERFORMANCE
    • BETTER – 1Q came in above guidance of $0.05-0.09.  Wholly-owned Adjusted EBITDA was $95MM, well above the midpoint guidance of $88-93MM.  Borgata generated EBITDA of $39m versus guidance of $32-34MM.
  • LV LOCALS MARKET
    • SLIGHTLY WORSE:  Characterized the market at "steady" with "very modest growth" but was impacted by slightly elevated marketing expenses and low hold percentage.  Low table game hold at Orleans and Gold Coast negatively impacted EBITDA by $1MM.  With normal hold, the Locals properties would've beaten our estimate.
  • DOWNTOWN
    • SAME:  Rated play increased YoY as Hawaiian visitor play remain robust.  Fremont set a 3-yr record in F&B rev in March.  But jet fuel increased $750k.  BYD reiterated its positive outlook on the new developments on Fremont St and sees no decline in visitation. 
  • BORGATA 
    • MUCH BETTER:  In addition to beating guidance and consensus handily, management stated they have not seen any impact from the Revel opening and they expect the positive performance posted in 1Q12 to continue.  Occupancy is running above expectations and cash ADRs are doing well.
  • IP PERFORMANCE SYNERGIES
    • MUCH BETTER: Improved operating margins by 350bps without all the $5MM synergies being realized.  IP exceeded expectations and sees considerable upside in the property. 
  • MARGARITAVILLE COMPETITION
    • SAME:  Reiterated that there would be minimal, if any, impact