Eldorado Resorts, Inc. (NASDAQ:ERI) Q2 2019 Earnings Conference Call - Final Transcript

Aug 06, 2019 • 09:00 am ET


Eldorado Resorts, Inc. (NASDAQ:ERI) Q2 2019 Earnings Conference Call - Final Transcript


Loading Event

Loading Transcript

Thomas Robert Reeg

-- our hotel rooms were down in the quarter and about 35% of our slot floor was offline. So I guess that gives you a sense of the disruption that we were facing in Colorado. So that was a difficult comp. We're happy to tell you that our Colorado project is complete. It looks great. It's been well received and we're getting the word out that the construction disruption is a thing of the past.

In Reno we knew we were facing a lack of bowlers in the quarter. And that was 15,000 room nights in last year's quarter. So that was a headwind that we knew. What we didn't know was coming was the weather in the -- largely in the Midwest. As those of you who know me know I hate to talk about weather, but it's unavoidable when the center of the country is flooded. So we had properties like Bettendorf where you had flooding, you had construction on the interstate approaching it, and so the traffic sent to the next exit where our competitor Rhythm City sits. So that was a tough competitive situation for us.

You couldn't even get off at our exit. Boonville, Cape Girardeau had bridges out where just from an employee standpoint, employees that were minutes from the property normally it would take over an hour to get to the property, so just a difficult situation. We had an access road at Vicksburg that effectively disintegrated that we had to rebuild. A lot of headwinds in the quarter, but despite those we were able to post over a 2% increase in same-store EBITDA to just under $179 million.

On the plus side, if you look at our Central region, Anthony is going to get into specifics, but our Central region is the cleanest look at our most recent acquisitions, since you have Elgin, St. Louis and Evansville in there. There's no noise from properties owned prior to the acquisitions last fall. And you can see that that region performed exceedingly well.

Our consolidated EBITDA margin expanded over 230 basis points, over 28%, so we were quite pleased with that. I'll tell you that as the quarter turned a lot of the issues that we've been talking about are now in our rearview mirror. You've got the bowling comp is done in Reno. Construction disruption is done in Colorado. The weather for the most part improved, although we did have a tropical storm that impacted the South a bit in July. But I'd tell you, despite continuing weather impacts in the beginning of July, that's now in the rearview mirror despite those impacts. On a consolidated basis we had a very good July and feel good about the quarter.

In Reno I'd point you to we just signed an agreement with the University of Nevada that has a shortage of beds due to explosion in existing dorms. We signed an agreement. Great work by Stewart Massie, our West Region VP, and Anthony Carano