LAS VEGAS -- Station Casinos, Inc. said Thursday the company had its best first quarter since 2009, reversing a net loss from a year ago while growing revenue nearly 6 percent.
The locals casino operator said its consolidated net revenue for the quarter that ended March 31 was $329.3 million, an increase of 5.6 percent. Station Casinos reported net income of $15.3 million, versus a net loss of $140.8 million in the same quarter a year ago.
The company’s cash flow margins increased by 33.7 percent, the highest in five years.
Station Casinos Chief Financial Officer Marc Falcone said the positive cash flow marked the 12th consecutive quarter of growth in the nontraditional reporting figure.
“Station Casinos had a strong start to the year with first quarter results reflecting continued improved performance across all areas of our business,” Falcone said in a statement.
During a conference call with analysts, Falcone said an increase in group business and convention activity along the Strip is helping to boost the prospects in the locals market.
Station Casinos has seen a “modest, single-digit increase” in revenue per available room at both Red Rock Resort and Green Valley Ranch Resort, which Falcone attributed to activity along the Strip. Revenue per available room is a nontraditional reporting figure Wall Street uses to gauge profitability.
“Las Vegas generally is showing signs of bouncing back, with March employment at its highest since 2008,” Falcone said.
Last month, Station Casinos announced a combined $55 million in upgrades and renovations to the Red Rock Resort and Green Valley Ranch Resort, much of it focused in the nongaming areas in order to drive customer traffic.
“We continue to execute on our strategy in a challenging environment,” Falcone said. “Our 2014 priorities remain unchanged as we focus on ways to drive revenue growth and realize operational efficiencies.”
Station Casinos is privately held, but the company has publicly held debt of $2.15 billion.
The company told the investment community its Northern California Indian casino, the Graton Resort &Casino, reported cash flow of $57 million and the company was paid $7.4 million in management fees. Graton, which is 45 minutes north of San Francisco, opened in November.
Falcone said he doesn’t expect Station Casinos to see any revenue benefit from the company’s online gaming businesses in Nevada and New Jersey.
Station Casinos is the majority owner of Ultimate Gaming, which operates Ultimate Poker in Nevada and the online presence for the Trump Taj Mahal in Atlantic City.
The biggest challenge is New Jersey, where online gaming has been slow to ramp up since six casinos launched websites in November.
Falcone said the operators are all working to build their databases and grow customers. He said the various companies have been working to build awareness of online gaming across New Jersey.
He was hopeful the company’s Nevada and New Jersey businesses will grow through the year.
“We should be getting closer to break-even as the year goes on, but I would say I don’t think we’ll be cash flow positive for 2014 in online,” Falcone said.
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