Sunset Station, Red Rock Resorts’ 28-year-old, 448-room Henderson property, will be the next company resort to undergo a major renovation, company officials said Tuesday during the company’s fourth-quarter earnings call.
The Las Vegas-based locals casino giant reported record quarterly net revenue and cash flow for the ninth consecutive quarter, justifying the planned $87 million investment scheduled to begin within the next four months and completed in early 2027.
“We are pleased to announce the next phase of Sunset Station, designed to further strengthen the company’s competitive position and broaden its customer appeal, positioning it to capitalize on the strong demographic trends and continued growth in the Henderson market, particularly from the master-planned communities of Ascaya and Cadence, which are expected to deliver more than 12,500 new households at full build-out,” Chief Financial Officer Stephen Cootey told investors in prepared remarks during the call.
High-end success
Cootey said the company’s high-end customers are driving Red Rock’s success. He said the next phase of development at Sunset will include expansion and enhancement of the property’s movie theaters as well as the relocation of a temporary bingo area currently housed in a former buffet space to a new permanent location.
“(For the) bingo relocation, we converted into a new high-end steakhouse and high-limit table games room, leveraging a proven strategy of investing in the higher-end segments of our database, which consistently generated strong returns across our portfolio,” Cootey said.
Red Rock’s biggest locals casino rival, Boyd Gaming Corp., also is counting on neighborhood growth to drive higher results. In an earnings call last week, Boyd CEO Keith Smith announced an earlier opening of the company’s Cadence Crossing Casino on Boulder Highway, from midyear to late March, to take advantage of exploding growth in the Cadence neighborhood.
Red Rock is using the same growth strategy with its Durango property in southwest Las Vegas. In mid-December, the company opened a high-limit slot machine room and a multilevel 2,000-space parking garage just two years after the resort’s 2023 grand opening.
Within a month of that, Durango announced it is investing $385 million for its second expansion that will include 400 additional slot machines, a 36-lane bowling facility, luxury movie theaters, multiple new restaurant concepts and food hall outlets and several new entertainment venues.
“Upon completion of this expansion, we believe Durango will be in better position to capture additional market share and drive sustained growth in the local market,” Cootey said.
Dividend payments
Red Rock is paying a special dividend of $1 a share on Feb. 27 for shareholders of record Feb. 20 and a quarterly dividend of 26 cents a share on March 31 for shareholders of record March 16.
For the quarter that ended Dec. 31, the company posted net income of $84.6 million, 75 cents a share, on revenue of $511.8 million. That compares with net income of $87.7 million, 76 cents a share, on revenue of $495.7 million in the fourth quarter of 2024.
“Robust visitation and net theoretical win across our local database, as well as our regional and national customers, drive the highest fourth quarter revenue and profitability in our gaming operations in the company’s history,” Cootey said.
In response to a question about Red Rock’s Super Bowl performance, President Scott Kreeger said Station Casinos didn’t experience any of the lackluster results that occurred at other Las Vegas properties.
“I had the pleasure of touring the properties on Sunday and walking with the general managers and … I can tell you there’s no better place to be on Super Bowl weekend than a Station Casino property,” he said. “We had every property fully programmed, whether it was the bars, the VIP part, and we had decent results from a betting perspective and even better from a gaming perspective on slots and food and beverage. If there was any slowdown elsewhere, it wasn’t on our properties.”
Red Rock shares, traded on the Nasdaq exchange, closed up $1.28, 1.3 percent, to $66.79 a share, with volume nearly double the daily average.
Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on X.