Boyd Gaming Corporation

Good afternoon and welcome to the Boyd Gaming first quarter 2020 conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Josh Hirschberg, Executive Vice President, Chief Financial Officer. Please go ahead.

Thank you, Grant. Good afternoon, everyone, and welcome to our first quarter conference call. First and most importantly, I hope each of you, your family, and friends are all safe, doing well, and staying healthy. Joining me on the call this afternoon is Keith Smith, our President and Chief Executive Officer. Our comments today will include statements that are forward-looking statements within the Private Securities Litigation Reform Act. All forward-looking statements in our comments are as of today's date, and we undertake no obligation to update or revise the forward-looking statements. Actual results may differ materially from those projected in any forward-looking statement. There are certain risks and uncertainties including those disclosed in our filings with the SEC that may impact our results. During our call today, we will make reference to non-GAAP financial measures. For a complete reconciliation of historical non-GAAP to GAAP financial measures, please refer to our earnings press release and our Form 8K, furnished to the SEC today, and both of which are available in the investor section of our website at BoydGaming.com. We do not provide a reconciliation of forward-looking non-GAAP financial measures due to our inability to project special charges and certain expenses. Today's call is also being webcast live at voidgaming.com and will be available for replay in the investor relations section of our website shortly after the completion of this call. Before I turn the call over to Keith, I want to point out that the release we issued today reports our preliminary first quarter results. as our accounting team and external auditors are continuing to complete required impairment reviews. Should their work result in any impairment charges and associated tax implications, you will see that report reported in our 10-Q filing for the first quarter. It is important to note the continuing review for potential impairments will not impact the operational results we are reporting today. So with that, I would like now to turn the call over to Keith Smith.

Keith. Thanks, Josh. Good afternoon, everyone. I hope that everyone's staying safe during these extremely difficult times. It is times like these that remind us what is truly important in life, our health, our families, and our friends. The financial damage of COVID-19 can and will be repaired over time. The same cannot be said of life's loss to this tragedy. The human cost of COVID-19 has been terrible, but it could have been far worse. Over the last six weeks, the freeze in non-essential businesses across the country has allowed our communities to start flattening the curve, saving countless lives. While the mandated closure of our properties was a necessary part of the broader effort to stop COVID-19, the impact to our company, our team members, and our communities has been significant. Before the crisis began in March, our company was on track to report strong first quarter results, opening the year with two consecutive months of solid growth across the country. Prior to the closures, our Las Vegas local segment was well on its way to posting its 20th straight quarter of EBITDA growth, with year-to-date revenue, EBITDA, and margin improvement across our Southern Nevada properties. Our downtown Las Vegas business was poised for another record quarter. And we saw strong performances across our Midwest and South properties with 13 of our 17 properties producing double-digit EBITDA growth through the first two months of the year. During this period, all but one of our regional properties boasted year-over-year growth in both revenue and EBITDA. Then came March, and the COVID-19 outbreak transformed our business and the communities we operate in. In response to state orders aimed at preventing the spread of COVID-19, Void Gaming closed every one of our 29 properties across the country over a six-day period from March 12th through March 18th. In the initial days following these closures, our first priorities were providing support to our team members and our communities. Our properties donated tens of thousands of pounds of food in cities across the country, and we contributed significant quantities of gloves and masks to first responders and hospitals. We also supported our team members across the country, providing a full month of pay and benefits while their properties were closed. At first, these closures were meant to be short-lived, but as the full extent of the crisis became apparent, stay-at-home orders were extended across the country. Today, six weeks after the closures began, all of our properties across the country remain closed to the public, and reopening dates remain uncertain. The results we reported today show the significant impact of these closures on our business. In order to assure our company is able to navigate through this crisis and resume operations in a strong position, we have made some difficult but necessary decisions. Our executive and management teams have taken significant pay cuts, and our board of directors agreed to suspend their compensation. We have halted all non-essential spending. All major capital projects have been suspended, as were our quarterly dividend payments and share repurchase activities. But by far the most difficult decision was placing most of our team members on furlough status in mid-April. This was the hardest choice we've ever made as a company. We care deeply about the well-being of our team members, and we postponed this decision as long as we could. But without any clear visibility on when we would be able to reopen our business, this was a decision we had to make. We recognize the impact these furloughs have on our team members, and we have tried to mitigate this impact by continuing to provide benefits coverage. All furloughed team members who are enrolled in our benefits program will remain covered through June 30th at no cost to the team member. And thanks to the approval of stimulus payments and enhanced unemployment benefits by Congress last month, our team members and our communities will receive much needed support to help them through these difficult times. As of today, we do not know when we will be permitted to resume operations and bring our team members back to work. It is likely that each of our 10 states will reopen on a different timeline, each with their own specific health and safety guidelines. We are currently working with state and local officials across the country to gain a better understanding of when we will be able to reopen and what reopening may look like. And while we do not have clear visibility regarding opening dates, based on the actions we have taken to reduce expenses and strengthen our cash reserves, as well as the work we have done in recent years to strengthen our balance sheet, We are confident we have sufficient liquidity to sustain our company until we can reopen our doors once again. Once the reopening process begins, protecting the health and safety of our team members and customers will be our utmost priority. And the safety protocols we put into place will meet or exceed the standards set forth by local, state, and federal health officials. As we look ahead and prepare for a return to business, We believe we will benefit from a business model that is largely focused on local and regional visitation. Across our nationwide portfolio, the majority of our business comes from local customers. We are not reliant on destination or convention business for success. As a result, as operations resume, we believe our local customer base will position us to lead the recovery of our industry. While these are certainly unprecedented times, we know that they will come to an end and we look forward to the start of the recovery. Before I turn the call over to Josh, I want to take a moment to recognize our team members, who I know have been significantly impacted by this crisis. While our properties may be closed, you are still part of the Boyd team, and we look forward to bringing you back to work as soon as we can. To those team members who have remained on the job throughout these closures, thank you for your hard work in keeping your property safe and secure. Your dedication and efforts will help us reopen quickly when the time comes. To our customers, we look forward to welcoming you back when it is safe to do so. I know that many of you will be looking for entertainment when stay-at-home orders finally end, and we look forward to hosting you again as much as you look forward to visiting us. And finally, we want to recognize the first responders and medical personnel who have been on the front lines of this fight. You have worked countless hours and put your health and well-being at risk to save lives and protect our communities during this pandemic. I know I speak for everyone at this company in thanking you for your incredible service. You're an inspiration to all of us. Thank you for your time. I'll now turn the call over to Josh.