Boyd Gaming Corp Selling South Coast Gambling Casino
Boyd Gaming Corp. said that it was disappointed in the performance of its newest Las Vegas casino and it will sell the seven-month-old South Coast property to Michael Gaughan, the founder of the Coast Casinos chain it merged with 2 years ago.
The announcement, combined with Boyd's 79 percent drop in second-quarter net income and less-than-expected profits from chief rival Station Casinos Inc., stoked analysts' fears of weakening demand for gambling among Las Vegas residents.
"I think there's concern that, from early indications, that the market growth is slowing," said analyst Matthew Jacob of Majestic Research. Boyd's announcement of the sale of the 600-room South Coast Hotel & Casino came less than a year after it opened in December at a cost of about $583 million. The property five miles south of the Las Vegas Strip has attempted to cater to horse lovers with its 1,200-stall equestrian center.
"Clearly, none of us can say that it met our expectations out of the box," chief financial officer Paul Chakmak said in a conference call with analysts. "Time will tell what ultimately that property can do. But, this transaction is a commentary on where we see it over the course of the next few years."
July 26, 2006
Posted By Terry Goodwin
Staff Editor, CasinoGamblingWeb.com
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