Red Rock Resorts, Inc. (NASDAQ:RRR) Q2 2020 Earnings Conference Call - Final Transcript

Aug 04, 2020 • 04:30 pm ET

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Red Rock Resorts, Inc. (NASDAQ:RRR) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

[Operator Instructions]

The first question today will come from Joe Greff with JPMorgan.

Analyst
Omer Nathan Sander

Hi guys. Omer Sander on for Joe. First off, the $46 million EBITDA in Las Vegas in June, what did the closed properties do in terms of EBITDA drag? And were you able to manage it lower in July? And can 45% margins for the reopened group of properties sustain themselves in the current environment?

Executive
Stephen Cootey

Okay. So I'll start with the easy one. And so the closed properties for June had a drag of about $1.4 million. That remained fairly consistent in July, though we think we can get it a couple of hundred thousand dollars lower going forward. Regarding the sustainability of the margins, I think we've done -- the team has done a great amount of work reevaluating and retooling the business during the closure. And our cost structure, it is in a position to deal with these very uncertain times from a revenue perspective. So we feel confident that we can deliver margins in excess of our historical margins.

Analyst
Omer Nathan Sander

Thanks. And then can you discuss what you've seen in July in the locals market in terms of gaming paper and behavior there? How much is revenue per day down versus June levels? What are you seeing with July with respect to customer mix? Which has been holding up better since the end of June, younger or older? And do you get a sense that the CARES is driving it?

Executive
Stephen Cootey

Sure. What we did with July -- generally don't comment on, again, our current quarter. But to give you some general sense, the trends in July have been basically consistent with what we've seen in June. We've seen less visitation. We've seen more spend per visit. We've seen more time on device. We've seen a younger demographic in our database show up. Our older demographic, to be expected, due to the current pandemic has stayed at home. I think this point here is encouraging because it's an opportunity for growth when our seniors start returning when the situation subsides.

Analyst
Omer Nathan Sander

Awesome. And then just one last one for us. Is there a market for assets for sale at prices that you can seriously accept? Or is it too early? And then lastly, just what's the future of Palms?

Executive
Stephen Cootey

I think it's too early to assess right now. Right now, we have very little clarity on our current economic environment. And so we currently -- Palms is currently undecided whether we're going to open right now.

Executive
Frank J. Fertitta

Yes. We don't know if or when we're going to reopen any of the closed properties. We think it's too early to make that decision at this time. I think so far, we're very pleased with the results that we've had, the ability to move some of the play from the closed properties to our existing properties. And we're going to continue to try to get clarity and navigate the situation to make well-informed decisions. But rest assured, whatever decisions we make