Red Rock Resorts reports Q4 2020 earnings of $343m

Red Rock Resorts announced fourth quarter net revenues of $343.4m, a decrease of 25.5%, or $117.4m, year-on-year.

The Las Vegas-based company saw net income of $49.6m for the quarter, an increase of $42.8m from Q4 2019. Quarterly adjusted EBITDA was $150.5m, a 9.4% increase y-o-y.

For the full year of 2020, the company’s net revenues fell 36.3% to $1.2bn, which is down from $1.9bn in 2019.

Red Rock ended the fourth quarter with $121.2m in cash or cash equivalents, while the total principal amount of debt outstanding was $2.9bn.

Four Red Rock properties remain closed: Palms, Texas Station, Fiesta Henderson and Fiesta Rancho.

“The reality is we have more restrictions on property now than we did when we reopened on June 4,” said Red Rock CEO Frank Fertitta during the company’s Tuesday earnings call. “We’re going to be very disciplined and we want to be in a position that, when we reopen any additional properties, that we know it’s going to be positive to our overall cash flow.”

Unlike most Strip operators, Red Rock’s main customer base is local to Las Vegas.

Fertitta and Red Rock CFO Stephen Cootey indicated that demand for their properties will rise as more Las Vegas residents get vaccinated for Covid-19 and feel safe venturing out.

“While Las Vegas has been and continues to be going through some very challenging times, we’re finding a light at the end of the tunnel,” Cootey said. “Once we are on the other side, we believe that the favorable supply and demand dynamics, the positive long-term trends in population growth and the stable regulatory environment all serve to support our long-term view that the Las Vegas local market is the most attractive gaming market in the United States.

Red Rock, which also operates select tribal casinos, is looking to finally break ground on a resort project near Fresno, Calif. in partnership with the North Fork tribe. A California Supreme Court ruling last September cleared way for construction to begin on the property, which will amass 213,000 square feet upon completion.

Cootey said the company will ramp up development efforts in the second quarter of 2021.

Ezra Amacher

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