Red Rock returns to net profit in 2021 as revenue climbs 37.3%

| By Robert Fletcher
Casino operator Red Rock Resorts was able to return to net profit in its 2021 financial year, after the easing of novel coronavirus (Covid-19) at its casinos helped drive revenue up 37.3%.

Revenue for the 12 months to December 31, 2021, amounted to $1.62bn (£1.20bn/€1.43bn), up from $1.18bn in 2020 when significantly more Covid-19 restrictions were in place at its casinos.

While some measures remained in the early part of 2021, these were eased over the course of the year, meaning more customers were allowed into casinos to gamble, as well as stay at accompanying hotels.

Casino revenue for the year hiked 49.8% to $1.14bn, while food and beverage revenue was up 27.2% to $245.4m, rooms revenue 65.4% to $143.9m and other revenue 36.2% to $76.6m. However, Red Rock did note that revenue from management fees fell 88.8% to $9.2m.

Looking at costs, total operating expenses for the year increased 11.2% to $1.22bn, but such was the impact of revenue growth that adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) more than doubled to $741.0m.

Red Rock also noted $119.2m in financial costs, including $103.2m in net interest expense, which left a pre-tax profit of $285.5m, compared to a $60.5m loss at the same point in 2020.

The operator received $69.3m worth of tax benefits during the year, while after deducting $113.0m profit from non-controlling interests, net profit attributable to Red Rock was $241.9m, a stark contrast to the $150.4m loss in the previous year.

Red Rock also published its results for the fourth quarter, during which revenue increased by 23.0% to $422.4m. Revenue was up across all business areas, again with the exception of management fees, which declined 99.2% year-on-year.

Operating costs were marginally lower at $261.1m, down 1.4% on the previous year, while adjusted EBITDA jumped 26.1% to $189.7m for the quarter.

Financial costs in Q4 reached $32.5m, which meant pre-tax profit was $129.7m, up 158.4% year-on-year.

Tax benefits amounted to $70.4m in Q4, while after deducting $51.4m from non-controlling interests, net profit attributable to Red Rock was $148.7m, an increase of 400.7% from the same period in 2020.

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