Red Rock Resorts has achieved unprecedented revenue for the first quarter, fueled by impressive performance in its Las Vegas operations. However, the company’s profits and core earnings have slightly decreased, and it has cautioned about potential short-term interruptions due to ongoing construction projects.
Net revenue increased by 1.9% to $507.3 million, while net income decreased by 3.8% to $82.7 million. Adjusted EBITDA saw a decline of 1.2% to $212.6 million, but the firm celebrated its second-highest adjusted earnings and near-record margins of 46.5% in Las Vegas.
Las Vegas operations generated revenue growth of 0.9%, reaching $499.5 million, bolstered by robust carded slot play and increased spending per visitor. Despite this, adjusted EBITDA from this segment fell by 1.5% to $232.4 million. Core performance across slot machines and table games remains stable in the market.
Non-gaming sectors, such as hotels and dining, posted near-record revenues and profitability, while Native American operations contributed $4.7 million in revenue and $2.9 million in adjusted EBITDA.
Chief Financial Officer Stephen Cootey highlighted that the Durango property is enhancing growth in the Las Vegas local market, with recent and planned expansions aimed at increasing capacity and boosting customer spending.
The firm is set to expand the property by 275,000 square feet, incorporating new gaming and entertainment facilities, with completion anticipated in 2027 at a projected cost of $385 million.
For the upcoming year, Red Rock is forecasting capital expenditures between $375 million and $425 million, which include upgrades to the Sunset Station, where renovations are currently taking place to enhance the casino floor, dining options, and entertainment.
“We are advancing to the next phase of Sunset Station, which is designed to solidify the property’s competitive edge and extend its customer reach to leverage ongoing growth in Henderson, especially from the master-planned communities of Ascaya and Cadence,” Cootey noted.
The company predicts that construction at various locations, including Durango, Green Valley Ranch, and Sunset Station, will result in significant operational disruptions amounting to millions in the second quarter.
Red Rock concluded the quarter with $134.0 million in cash and cash equivalents, while total debt stood at $3.6 billion. The board has announced a dividend of $0.26 per share for the second quarter.
Board member Lorenzo Fertitta mentioned that the company is exploring new development opportunities.
“We are currently working on two new greenfield projects, progressing through the planning, scale, and pricing phases,” Fertitta explained. “While we don’t have announcements to make at this time, we expect to have more clarity on development plans as we move into next year.”