Boyd Gaming Corporation (BYD) Q3 2017 Earnings Report, Transcript and Summary

Good afternoon, everyone, and welcome to Boyd Gaming's Third Quarter 2017 Conference Call. All participants will be in a listen-only mode. [Operator Instructions]. After today's presentation, there will be an opportunity to ask questions. [Operator Instructions]. Please also note that today's event is being recorded. At this time, I'd like to turn the conference call over to Mr. Josh Hirsberg, Executive Vice President and Chief Financial Officer. Sir, please go ahead.

Thank you, Jamie. Good afternoon, everyone, and welcome to our third quarter earnings conference call. 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 non-GAAP to GAAP financial measures, please refer to our earnings press release and our Form 8-K furnished to the SEC today, and which are available in the Investors 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. Finally, today's call is also being webcast live at boydgaming.com and will be available for replay in the Investor Relations section of our website shortly after the completion of this call. I'd now like to turn the call over to Keith Smith. Keith?

Thanks, Josh. Good afternoon everyone. Before I begin with my comments on our quarterly results, I want to take a moment to address the tragic events of October 1st. Boyd Gaming joins the entire Southern Nevada community and remembering those who were lost. We offer our condolences and prayers to their families and friends and our best wishes for the recovery of those who are injured. This was an unspeakable tragedy. The Las Vegas community can be proud of how we responded in the phase of diversity. Our company is truly grateful for the bravery of first responders across the valley including the Las Vegas Metropolitan Police Department and our local fire departments. They risked their lives to save so many others and we're truly grateful. We were proud to see thousands of Las Vegas lining for hours at blood banks across our city including many of our own team members and we were proud to see our entire community pull together to assist those who need help. To-date at least $20 million has been pledged to victim relief efforts including $1 million from Boyd Gaming. Our company also joined others in providing free hotel rooms to the families of victims. From a business perspective it is still early and the long-term impact of the Las Vegas tourism community remains unclear. We have not seen any material impacts or business or the destination over the last several weeks and we do not anticipate any material impact in the future. That is not a biggest concern at this time. As a company and as a city, our primary concern is helping those who need our help and helping this community recover. October 1st was a horrible tragedy. But based on what we've seen over the last few weeks I'm confident Las Vegas and Southern Nevada will emerge stronger than ever before. Now let's review our quarterly results. The encouraging trends we've seen across our operations over the last several quarters continued into the third quarter. We delivered solid performances across the country with margin improvements in every segment of our business. In Las Vegas, our locals business reported its best third quarter in a decade. Every locals property achieved double-digit EBITDA gains, growth in revenue, EBITDA, and margins were all the strongest we have seen so far this year. And those trends are carrying into the fourth quarter with strong results across our locals operations at October. On a same-store basis, the third quarter marked the 10th straight quarter of EBITDA guidance and margin improvements for our locals business, it was the best third quarter in nearly a decade. EBITDA growth continued at a double-digit pace as margins improved by almost 400 basis points. This performance was matched by equally strong results, at Aliante, Cannery and Eastside Cannery our three newest properties posted impressive EBITDA gains and margin growth. We continue to execute on synergies and make improvements throughout these operations growing margins by more than 400 basis points over their standalone results last year. We have now grown EBITDA at a double-digit rate at each of these properties every single quarter since we acquired them. And with three strong quarters now on the books, we remain confident we will achieve our stated EBITDA target of $60 million to $62 million for these properties in 2017. Across the segment, our local operations continue to benefit from several factors. First, healthy Southern Nevada economy continues to drive growth throughout our locals portfolio. Total employment has reached an all time high of 983,000 up 2.4% year-over-year. That is the fourth fastest job growth rate in the United States. This job growth has been diverse and broad-based. We're seeing healthy growth in a variety of sectors including professional and business services, education and health services, leisure and hospitality and financial activities. However the strongest gains are in the construction sector where employment is up 18% year-over-year and with $15 billion in projects now planned or underway across the Las Vegas Valley, we expect robust job growth to continue. This broad-based demand for labor is driving solid wage growth. Weekly wages are now up 5.5% year-over year more than double the national average. And we continue to see encouraging data from local housing market as well. Existing home sales are up 7.5% over the last 12 months, while new home sales are up nearly 14%. This demand has driven resale prices up 15% year-over-year. To put that into perspective, home prices in Las Vegas have more than doubled from their low point in 2011. With more disposable income in their pockets and more equity in their homes, local residents continue to increase their spendings with taxable sales up 4% over the last 12 months. The healthy regional economy is clearly boosting our business and should continue to do so. But we're also reaping the benefits of our investments in non-gaming amenities over the last several years. These amenities have raised the profile of our brands throughout the market and they are boosting the profitability of our non-gaming operations. And finally, our results in the locals segment are attributed to our operating teams throughout the Las Vegas Valley as we continue to refine our operations and achieve outstanding flow through on our top-line growth. But Las Vegas growth story is more than a locals story; we saw that clearly in our Downtown, Las Vegas segment which delivered a strong third quarter performance. While all three Downtown properties grew revenue and EBITDA the biggest growth contributor was the California which bounced back from the construction disruption we saw in the second quarter. Our construction team completed this hotel project in August ahead of our earlier schedule. As a result, the Cal had its entire room inventory available in September and the property made the most of it. [Hawaiian] [ph] unrated play up across the segment during the quarter and we saw continued increases in unrated play an indication that we are picking up our share of growing visitations throughout the Downtown area. We are optimistic this long-term growth trajectory will continue, resurgence of Downtown Las Vegas shows no signs of slowing down as new projects and new developments continue to move forward throughout the area. Once complete, these new investments will help drive additional visitation and growth throughout Downtown and thanks to the investments we have made Downtown in recent years, we’re well-positioned to capitalize on future growth in the markets. Moving next to the Midwest and South, we continue to see encouraging results throughout our regional portfolio, as underlying trends continue to improve throughout the segment. And if not for Hurricane Harvey, this segment would have posted year-over-year EBITDA growth for the quarter. The most significant impact from Hurricane Harvey was in our Delta Downs' property in Southwest Louisiana which was severely affected by extensive flooding throughout its region. We estimate that Harvey impacted business volumes at Delta Downs for several weeks starting in late August and continuing through the Labor Day weekend into mid-September. But since that time and continuing into October, business volumes have begun to return to normal at Delta Downs. We also saw some short-term impacts from Harvey at other properties in the Louisiana and Mississippi though not to the same degree as Delta. In all, we estimate this disruption reduced the EBITDA by several million dollars across the segment. Storm-related impacts aside we made good progress across our Midwest and South segment during the quarter. In Iowa our two properties continue to produce solid results. In Illinois, the team at Paradise delivered a great performance posting a double-digit EBITDA gain despite an increasingly competitive environment. To the East in Indiana Blue Chip performed in line with the prior year just preparing for the opening of a new Tribal gaming competitor in the key feeder market of South Bend early next year. EBITDA was also in line with the prior year at the IP and Biloxi. This was an encouraging performance considering the impact of Harvey. In Kansas the Kansas Star to continue to see solid underlying trends throughout the business reporting results that were even with the prior year. In Louisiana, conditions remain challenging at Evangeline Downs which is contending with softer economic condition in its market. But the picture is brighter elsewhere in the state as Treasure Chest and Sam's Town Shreveport each delivered strong EBITDA growth. Looking into the fourth quarter, solid operating trends have continued across our Midwest and South segment, despite the impact of Hurricane Nate which cost the IP and Treasure Chest a full weekend of business in early October. So in all, the third quarter was another strong performance by our operating teams across the country. Also during the quarter we made significant progress in Northern California where we have a partnership with Wilton Rancheria to develop and operate a new gaming resort. The Wilton tried long quest to open a resort took another big step forward in September as the California State Legislature unanimously approved its tribal State Gaming compact with the price. Just a few weeks later California's Governor signed its compact in the law. With the compact now in place and land taken into trusts for the Tribe, we are now in the process of finalizing project design and preparation. We expect to begin construction next summer with the development timeline of 18 to 24 months. Located just 15 miles south of Downtown Sacramento and with direct freeway access, this project will be strategically positioned to serve both the Sacramento and San Francisco Bay markets. We're honored to be the Tribes partners in this exciting project and we congratulate Chairman Hitchcock in the Tribe on their tremendous progress to-date, we look forward to working with them and bringing their vision of a world class gaming resort to life. But beyond the Wilton project, we remain committed to our long-term growth strategy and we will continue to actively explore opportunities to further invest in our business and expand our portfolio through acquisitions and new developments. We have clearly demonstrated our ability to drive growth with our recent acquisitions and we believe that there are additional opportunities available to us. In the meantime, our core operations are generating strong and growing free cash flow and we continue to put that free cash flow to work in the third quarter, investing in our business, de-leveraging our balance sheet, and returning capital to our shareholders. In all, we're making good progress as a company. We feel good about the trends we're seeing throughout the business and we expect those positive trends to continue. Thank you for your time and now I would like to turn the call over to Josh.

Thanks, Keith. During the quarter, we continued our focus on debt reduction, reducing our balances by approximately $73 million. This bring year-to-date debt paydowns to approximately $165 million and that is after $78 million in one-time land purchases and approximately $28 million of dividends and share repurchases so far this year. This de-leveraging is testament to the strength of our free cash flow. We expect to achieve our target leverage of four to five times EBITDA during 2018. Our quarter end debt and cash balances were provided in our earnings release. Year-to-date through the end of the third quarter, we have repurchased nearly 900,000 shares. We have currently outstanding 112.6 million shares as of the end of the quarter. We have approximately $70 million remaining under our share repurchase authorization and expect to utilize this authorization over the next 12 to 18 months. As we have previously stated, we will be measured in the execution of our repurchase program, as we believe we will continue to have opportunities to grow through new developments and acquisitions and want to continue to de-leverage our balance sheet to achieve our leverage targets. Separately on October 15, we made our second quarterly dividend payment of the year of $0.05 per share representing a cash distribution to shareholders of approximately $5.6 million. During the quarter we invested approximately $42 million in our properties bringing year-to-date capital expenditures to approximately $118 million excluding land purchases. And finally, as noted in our release, we are reaffirming our previously provided EBITDA guidance of $585 million to $605 million. Despite impacts from Hurricane Harvey which impacted Delta Downs for several weeks during the third quarter and Hurricane Mate which impacted a busy weekend at IP and Treasure Chest during October, we expect to be around the midpoint of this range. This was another solid quarter for our company, our Nevada businesses continue to perform at a high level and we're pleased with the performance of our acquisitions. Our Midwest and South operations reported continued improvements in their results. The strong and growing free cash profile of our business driven by robust economy in Southern Nevada, a healthy consumer across the country, and our ability to leverage our size, scale, and operational capabilities to enhance margins will continue to provide opportunities to generate long-term value for our shareholders. Operator that concludes our remarks and we're now ready to take any questions.

Ladies and gentlemen, at this time I will begin the question-and-answer session. [Operator Instructions]. And our first question today comes from Carlo Santarelli from Deutsche Bank. Please go ahead with your question.

Hey guys, thanks for taking my question. And Keith I apologize if I missed this in your opening remarks I was -- I was a touch late. But the -- when you guys, when you think about obviously the tragedy that took place and you think about some of your assets positioning I think if there were to be any spillover my guess would be kind of the Orleans would see most of your out of town hotel stays et cetera or strip kind of compression Orleans night. Could you talk a little bit about like that property and maybe what you're seeing there and how you kind of see that book of business shaping up for Orleans specifically?

Sure. I did make a few comments at the beginning of my comments and basically what I said was we're not really seeing an impact to the overall business. I think we saw very slight uptick in cancellations early on during the quarter right after the incident but it has rebounded to a normal level fairly quickly. And so we're really at the Orleans or any other properties here in Las Vegas not seeing any uptick in cancellations or any other real impact on the business.

Great, thank you. And then obviously some of your peers off late have talked quite extensively about focusing part on kind of promotional discipline and trying to get smarter around that obviously within your 250 to 300 basis point margin improvement targets over the next several year I believe that’s that has been a piece of it. Could you talk a little bit about anything you are seeing in the competitive landscape today on the promotional front that makes you maybe more encouraged that you might be able to get more than you previously thought from that piece of the initiative at least?

So I think that focusing on kind of our marketing spend and make sure we're spending it as efficiency and as productively as possible, has been a focus for more than a year probably going on two years now. I think we're seeing good progress. I think we have more to go. I don’t think the competitive landscape has changed much in the last quarter or two; it is at a fairly normal level. As I always say it gets a little out of whack every now and then with the competitor doing something but it's been fairly, fairly normal for a quarter or two. In terms of where it goes in the future well that's hard to say predicting what competitors are going to do how they going to run promotions in the future is difficult but we’re fairly disciplined, we have the path we're on, we like the results we’re seeing as result of the changes that we're making to our marketing programs and how we’re kind of rolling them out. And so I think we’re going to stay the course and continue to execute on our strategy.

Our next question comes from Joe Greff from JPMorgan. Please go ahead with your question.

Good afternoon guys. I too was on another call, so I may be asking a question that you already sort of answered in your prepared comments but Keith, Josh, what I think of this year and the disruption at the California last quarter the 2Q, any disruption in the 3Q, weather impacts across the portfolio in 3Q, and Nate so far in October and I look at the sum total of that impact on EBITDA and now I hear you saying the mid-point of EBITDA guidance just great no one picking at that. But if we were to adjust and add back the impact from all these things would you be saying today otherwise that you would be above the higher end of the range, is that a fair way of characterizing some of these one-offs?

I think the one-offs are fairly meaningful but it's hard to say that I think we will be toward the upper end of the range. I'm not sure the word we will be confident we would be saying that we were outside of the top end of the range. I would have to go back and kind of look at each of those individual pieces and try to quantify them but I think we are comfortable at this point saying that we would certainly be at the top end of our range.

Okay, great. And then Josh you may have said this and I missed, CapEx for the quarter, CapEx guidance for the year, for the 4Q and then what was the buyback in the 3Q I know it had to be relatively small.

I did give some information on CapEx. I indicated that we have spent about $42 million during Q3 and that brought the amount of capital spend year-to-date to $118 million that excludes the land purchases that we did in Q1 related to Wilton and the Orleans you may remember the total $78 million. In terms of share repurchases I mentioned that year-to-date we purchased nearly 900,000 shares through the third quarter, in the third quarter it was just over 400,000 shares.

And the dollar amount in the 400,000?

About $10 million worth.

Thank you.

$10 million to $11 million, yes.

Our next question comes from Mark Savino from Morgan Stanley. Please go ahead with your question.

Hey good afternoon guys. Keith in your prepared remarks, you have mentioned incremental competition for Blue Chip just wondering if you could give a little color on maybe how we should be thinking about potential cannibalization risk for that property.

Sure. So the four winds project in South Bend they've discussed an opening sometime early in the year, so we don't have a more definitive date than that. South Bend is one of the top five markets for blue chip and certainly not one or two but it's in the top five and so we do expect there will be an impact. Because we don't know when it's going to open and exactly how competitive it will be and how it will operated it's tough to determine exactly what that impact will be but suffice to say there will be an impact.

Very helpful. And then just shifting gears and wondering if you can maybe just provide some comments around what you're seeing in the M&A environment lately and maybe what's your latest thinking around your M&A strategy going forward here.

Look, I think there are as many things to take a look at today as it has been in recent years, it's a described as a very active market, there's a lot of things floating around out there as always we really don't talk about them until we have something to say but I think it's very active. Our strategy hasn't changed; we're looking for a high quality assets and good market something that's going to move the needle. We're not particularly interested in smaller assets. We're more focused on larger assets that could make a difference in the overall kind of company’s profile. And we want them to be high quality; we're somewhat agnostic to the market, certainly we love to have more assets here in Nevada, I think we've done a great job with a recent acquisitions in Nevada it's an extremely strong market right now but if there's opportunities in other markets we will look at them as long as it meets the criteria that we have set forth that we've been pretty diligent about sticking to.

Our next question comes from Steve Wieczynski from Stifel. Please go ahead with your question.

Hi guys good afternoon. Josh I want to go back to the -- to an earlier question about the guidance and your range has basically been that the same range all year long which is great I think it tells you -- it tells us that you guys know what the hell you're doing in terms of giving guidance. But at the same time you only really have about two months left in your major operating year at this point. So I guess why keep that range kind of still extended at this point I know you called out the midpoint that's kind of where you thought you would be but I guess what I'm getting is what would get you more maybe on the lower end with two months left and what gets you on the higher end with two months left does that make sense.

It does make sense. I think from given that we talked about it being around the midpoint of the range and with how much time is left in the remaining in the year, I think we you could think of it as being just around that midpoint as we stated. I think we have a high level of confidence is going to be somewhere around that. In order for it to be much higher than that we would have to have some really significant change in consumer behavior and to have it be something much lower than that would have to be something that we are not anticipating at this point.

Okay, got you. And then second question would just be with Aliante generated I know in your release you said you saw pretty impressive results there and correct me if I'm wrong but I don't think your B Connected program has been linked up there yet. Can you just give us an idea of are you still kind of thinking same timeframe in terms of getting that in there and then also what -- how you guys are thinking about once that's embedded how do you think that property will perform post adding that in.

So we have not connected those three properties is part of our overall in the marketing system or reconnect the system that will happen in the first six months of next year probably be thinking the second half of that more like Q2 than Q1. Obviously we believe it will be additive to our ability to cross market those properties and to move those customers kind of around the Valley and around the portfolio locally and also offer that product some rather state customer. So we would expected to be in that positive once it's done but it’s probably sometime in the first half but more like a Q2.

And if I can add one just one more on and in terms of the B Connected program can you give us an idea of what you guys have kind of seen over the last couple of months in terms of a sign ups and then maybe also progression through the through your tier program.

Yes. I actually don't have those that data at my fingertips I know just from talking to our operating guys that we continue to see good healthy sign-ups across the portfolio it is something that we monitor and we monitor the health of those sign-ups and kind of where they're add from an AVT or deal basis and remains healthy, remains -- they remain growing but I actually don't have the specific statistics in front of me.

Our next question comes from Harry Curtis from Nomura Instinet. Please go ahead with your question.

Hi guys. I wanted to go back to the Las Vegas locals market for a minute maybe 10 to 15 years ago it was a really strong market in terms of EBITDA on a same-store basis say back in 2006 and a lot of that was based on a really strong construction market. If you could discuss how the market is changed since then because it's a much broader market constructions listing. Do you have any sense that that gap that you experienced in your existing assets can be recaptured over the next couple of years as the economy deepens and strengthens?

With a couple of comments, Harry, look prior to the recession Las Vegas was driven by construction. It was driven by development I don't know the statistics at my fingertips but once again probably 150,000 store construction jobs that are peak in this town and then it dropped into the 20s or 30s or at the bottom we're probably back to the 55 or 60,000 level now. And so we're less than halfway back I think that was an important customer for us back then so that does account for some of the difference. Do I think we can get back on a same-store basis where we were prerecession back in 2006 and 2007 that are peaks now I don't. I think the world is a completely different place how the consumer is spending their money, how freely their spending their money, how they have access to their money in terms of availability of credit, availability of second and third mortgages. And the whole environment is different, people are just spending differently. So, I don't think we rebound to back to where we were to I think we continue to close the gap absolutely. I think we're making great progress on that the business is different today so, I think we will continue to close the gap again I don't think we get back to those pre-recession levels of the same sort of basis. And I'll see if Josh has any other comments you'd like to add.

I don't think you covered it, Keith. I would just say that I think we take comfort in the health in the Las Vegas economy is providing a broad support for the business that we are seeing today. And I think that a lot of what we are seeing today is not only driven by the investments we made in our business by the operations that our guys are executing on it but also the economy overall. And I think the health of the economy gives us some comfort. That it's not overheated that it's kind of moving along at a realistic pace and gives us some comfort of cushion in a sense of the health of the economy relative that there were slowdowns. We felt pretty good about where the business is just generally.

And may be as one final closing comment I think today's economy here in Las Vegas is much healthier, it's much more diversified, it is not solely driven by construction and development and so we talked about the growth in other job sectors. We have a much more diversified economy many of the business that have come to town and I think it will be much more stable economy whenever the next slowdown happens.

Very good and I did have a follow-up. With your free cash flow yield pretty nicely above 10%. I'm just curious on the M&A strategy. It's not as if there are enticingly cheap casinos out there. Particularly relative to your strong free cash flow yield, so, I was a little bit disappointed in the number or the amount of share repurchase in the quarter and can you speak to your thoughts on the attractiveness of your own stock as opposed to M&A strategy at this point. It just seems just reasonably obvious that that the stock is a much better value.

I think we've talked about this in the past as we see this is the balance, sort of balancing act between reinvesting in our business, looking for growth opportunities continuing to deleverage because we're not at the leverage profile we ultimately would like to be at as well as returning capital to our shareholders. We just have entered into the strategy a couple of quarters ago now in terms of adding this additional kind of leg to the stool of returning capital to our shareholders and so we're continuing to move forward but as the business grows as the free cash flow increases and as our leverage comes down we'll look to see what to do with that. I think in the past, we've been pretty prudent of allocators of capital, we are sensitive to the new projects have to pencil out and once again we will kind of as we move forward in life and we see what the future looks like, we'll see how we continue to allocate capital, Josh?

So, Josh, is that it?

Yes that's it, he hit the nail on my head.

Okay, well hit. Thank you.

Our next question comes from Shaun Kelley from Bank of America Merrill Lynch. Please go ahead with your question.

Hi good afternoon everybody. I was sort of little late in joining and this has already been said, sorry for making you repeat yourself, but just wanted to kind of go back to a locals and talk a little bit about the same-store performance. I noticed in the release you guys gave some good detail on the margin front but Josh you didn't quantify what you saw on a same-store basis on the top-line on any parameters or kind of general sense you give us, I mean I think we saw market wide numbers that were actually very, very healthy probably the higher part of mid-single-digit at least through August, is that sort of the right trajectory of where you guys actually came in on the top-line for the same-store portfolio?

Well this we have not been breaking out the different between same-store and acquisitions throughout the year and so we're not going to start here but I also want to remind you that what we've been doing is managing for profitable revenue growth not just trying to drive revenue growth for the sake of that. I would say that we've generally been pleased with the level of revenue growth relative to the market overall because what we try to do is we try to kind of make sure that we are on a relative basis performing where we think we should in the context of the overall market while at the same time balancing with kind of how we are deploying our marketing dollars. But I would say that one thing we did talk about before you got on is just that this quarter we had some of the best performances in both revenue EBITDA margin growth in the Locals business, it was the strongest third quarter. In terms of EBITDA really throughout in the last decade, so there's double-digit EBITDA growth, good strong margin improvement across the board. So from our perspective, it's playing out exactly what like we would want it to and whether we're getting over or below market growth from the perspective of our focus on EBITDA and margin improvement that's where our focus is and that’s playing out for us.

Thanks for that. And then maybe just as a quick follow-up, obviously there are a couple of properties that are undergoing some renovations elsewhere in the market, just kind of curious do you think you’re catching spillover from some of that activity right now or do you kind of think that those customers are fairly siloed and you're probably not picking up much from so many spillover or disruption elsewhere?

To help a few could be specific of what properties you're referring.

Palms and Power Station.

Those my guess but I just wanted to make sure.

Yes sorry to start talk in -- talk [indiscernible].

So the power station, I think we've really seen much of an impact from construction activity going on there, we don't see it as a huge competitor to the Gold Coast Property and I think you look at the Palms and we’ve seen some pick up there, I think they’ve done a very good job of managing through their disruption but there's quite a bit going on over there. So I think we have seen a little bit of a pickup there more than anything at the Gold Coast, I think we’re just seeing great business from some of our non-gaming improvements we've made at the property and just driving business through other initiatives we have and so the bulk of the growth we're seeing at the Gold Coast and secondarily at the release is from our own initiatives as opposed to the disruption but we've probably seen just a little bit from the disruption of Palms.

Thank you very much. And maybe just one last quick one would be just as we get later in the economic cycle and as the strip continues to improve, locals can also sometimes get a little spillover from the Strip D. Do you think you see any of that at some of the properties I know like the Orleans for instance has gotten that in the past? Are we at that kind of level where we’re seeing some of that business return or you're just creating your own demand there and just how would you characterize that kind of spillover environment when the town is full?

A good clarity that is how the town operates when the strip fills up some of the off-strip properties the Orleans and the Gold Coast and others are able to maybe leverage up their amenities more. I think we’ve been in business, long enough of great reputation for conventions in meetings at the Gold Coast and that Orleans we actually do have our own book of business with plenty of repeat visitations but we do gain some pricing power, when the strip is full and the strip is able to start to raise rates, it's clear that we've benefit from that also. But we clearly have kind of our own business that comes to us because we're not on the strip.

And ladies and gentlemen, at this time is showing no additional questions. I would like to turn the conference call back over to management for any closing remarks.

Thank you for joining the call today, if you have any follow-up questions feel free to reach out to the company and we look forward to talking to you again in a couple of months.

Ladies and gentlemen, that does conclude today’s conference call. We thank you for attending. You may now disconnect your lines.