Red Rock Resorts, Inc. (NASDAQ:RRR) Q2 2023 Earnings Conference Call August 3, 2023 4:30 PM ET

Company Participants

Stephen Cootey - EVP, CFO and Treasurer

Scott Kreeger - President

Lorenzo Fertitta - Vice Chairman

Conference Call Participants

Joe Greff - JPMorgan

Carlo Santarelli - Deutsche Bank

Steve Wieczynski - Stifel

Dan Politzer - Wells Fargo

Chad Beynon - Macquarie

David Katz - Jefferies

Operator

Good afternoon, and welcome to Red Rock Resorts Second Quarter 2023 Conference Call. All participants will be in a listen-only mode. Please note, this conference is being recorded.

I would now like to turn the conference over to Stephen Cootey, Executive Vice President, Chief Financial Officer and Treasurer of Red Rock Resorts. Please go ahead.

Stephen Cootey

Thank you, operator, and good afternoon, everyone. Thank you for joining us today for Red Rock Resorts second quarter 2023 earnings conference call. Joining me on the call today are Frank and Lorenzo Fertitta, Scott Kreeger and our executive management team. I'd like to remind everyone that our call today will include forward-looking statements under the safe harbor provisions of the United States federal securities laws. Developments and results may differ from those projected.

During this call, we will also discuss non-GAAP financial measures. For definitions and a complete reconciliation of these figures to GAAP, please refer to our financial tables in our earnings press release, Form 8-K and investor deck, which were filed this afternoon prior to the call. Also, please note that this call is being recorded.

Before we get into any of the details, the second quarter represented yet another strong quarter for the company. The quarter represented our third best second quarter in the history of our company in terms of same-store net revenue, adjusted EBITDA, adjusted EBITDA margin only surpassed with the extremely strong second quarter of 2021 and 2022.

Within the quarter, the month of April provided a particularly tough year-over-year comparison and accounted for the majority of the year-over-year decline in our results within the quarter, with May and June performing more in line with last year's selling results.

Despite a tough April, the management team executed on our core strategy of keeping the properties fresh and relevant for our guests and delivering another extremely strong quarter with the quarter marking the 12th consecutive quarter, as the company delivered adjusted EBITDA margins in excess of 45%.

Now let's take a look at our second quarter results. On a consolidated basis, second quarter net revenue was $416 million, down $6.1 million from the prior year's second quarter. Adjusted EBITDA was $175.3 million, down $13.6 million year-over-year. Our adjusted EBITDA margin was 42.1% for the quarter, a decrease of 260 basis points year-over-year.