Station Casinos optimistic despite losses in first quarter
Station Casinos is banking on moves it made in the first three months of the year to reverse the company’s fortunes after reporting a net loss of $142.2 million for the first quarter that ended March 31.
Most of the loss was attributed to expenses resulting from the refinancing of $2.47 billion in debt.
But the company, buoyed by becoming the first American casino operation to offer online poker in April and the streamlining of the company’s organizational and capital structure in March, expects those moves to pay off for the rest of the year.
The quarterly loss compares with earnings of $6.8 million in the first quarter of 2012. The company also reported less revenue for the quarter — $311.8 million compared with $318.2 million in the first quarter of 2012. The 2012 quarter had an additional day because of leap year.
Station owns and operates 13 locals properties in Southern Nevada, manages the Gun Lake tribal casino in southwestern Michigan and is a 57.3 percent owner of Fertitta Interactive, the company’s online gaming operation.
Fertitta Interactive became the first company to offer real-money online poker on April 30 when the company’s Ultimate Poker product debuted. In an earnings conference call Tuesday, Station officials said the company is closing in on its 1 millionth poker hand dealt.
Company officials said it was too early to disclose revenue projections from Ultimate Poker, but they said players have signed up from around the country anticipating the possibility of play expanding beyond Nevada’s borders. Only people within the state can play online, but recently approved legislation enables the governor to sign compacts with other states that would allow non-residents to play.
Station Chief Financial Officer Marc Falcone said the company has a competitive advantage by owning and operating the online poker software. He said additional games, platforms and features would be rolled out through the rest of the year.
“Net revenues in the first quarter were impacted by a combination of the increase in Social Security payroll tax, federal tax refund delays and one less day in February this year versus last year,” Falcone said in a statement issued when earnings were announced.
The company also is continuing to develop the Graton Resort & Casino in northern California, expected to open in the fourth quarter of this year.