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Growth in the online segment partially offset a land-based revenue decline in the Boyd Gaming Q1 2024 report.

Boyd reported $960.5m in revenue for the three-month period ending 31 March, down 0.4% from Q1 2023.

The total resulted from a 4.5% decline in land-based gaming to $634.1m being partially offset by an increase in online revenue.

Online revenue for the period rose 19% to $146.2m.

The business attributed the severe weather in the South and Midwest, along with increased competitive pressure in the Las Vegas locals, for the decline in land-based revenue.

EBITDAR also fell year-on-year, declining 10% to $330.5m in Q1 2024.

The trend continued for the company’s net income, which declined 31.7% to $136.4m.

Boyd CEO and president Keith Smith said: “By focusing on our disciplined operating and marketing strategies, we have been able to maintain strong operating margins.

“Additionally, our significant cash flows and strong balance sheet allow us to continue returning capital to our shareholders through our ongoing share repurchases and quarterly dividend programmes.

“Looking ahead, we remain confident in our ability to successfully navigate the current environment and deliver value to our shareholders.”

Boyd has a significant presence in US online gaming through its strategic partnership with FanDuel, the number one US sportsbook by market share.

The operator has a 5% equity stake in the platform. Smith said he expects the online segment to generate $60-65m in EBITDAR for the year.

The company’s Boyd Interactive business is the parent of its Boyd Interactive subsidiary which offers both B2B and B2C iGaming services.

The business bolstered its capabilities in 2022 in this segment following the $170m acquisition of Pala Interactive from the Pala Band of Mission Indians.

Boyd Q1: Analyst take

Analysts at JMP Securities highlighted that trends shifted negatively across several areas of the Las Vegas market in Q2.

This included a decline in downtown visitation and in spending in the locals market.

While JMP said tough comparables will ease in mid-2024, competitive pressure is now having a material impact on results.

The analysts argued the company will continue to invest, although M&A is currently unlikely.

On the earnings call CFO Josh Hirsberg also poured cold water on M&A speculation, stating the company continued to be “disciplined” on this front.

Hirsberg said. “There are a lot of things that are for sale that don’t meet the criteria that we kind of put forth for ourselves and making a decision.”

He also recommitted to investing in the business as a good use of capital.

JMP highlighted the Boyd’s growth budget doubled to $200m in 2024, which could spur growth in 2025.

This, the firm said, has followed three consecutive years of EBITDAR declines.

JMP reiterated its Market Perform rating for the stock in the wake of the Q1 2024 results.

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