Summary:
- Resorts World Las Vegas is going into “recovery mode” amid revenue dips and a $10.5 million fine for compliance violations.
- Non-gaming areas like conventions, food and beverage, and retail are strong.
- Leadership changes are aimed at driving further growth.
Resorts World Las Vegas is working to rebound after a turbulent stretch, with company leadership telling Nevada gaming regulators this week that the property is focused on long-term recovery and reshaping its internal culture.
CFO Castro: “We’re Looking to Rebuild That Business”
Carlos Castro, who was recently named both COO and CFO of the resort, told the Nevada Gaming Control Board that the casino operation “is in a recovery mode”, noting a significant downturn in business over the past three quarters.
“We’re looking to rebuild that business”, he said, pointing out a sharp decline in slot machine revenue. A new senior vice president of slot operations will step in on June 1 to help revive that side of the floor.
But the conversation wasn’t just about financial performance, it centered heavily on compliance.
The Strip property was fined $10.5 million in March for allowing individuals tied to illegal bookmaking operations to gamble.
In response, the resort hired seasoned gaming attorney Jennifer Roberts as chief compliance officer last month.
Castro stressed the importance of her role, emphasizing the need to create a “culture of compliance across the campus”, reinvigorate their training programs, and provide “an ethics hotline to report activity anonymously and efficiently” to Roberts’ team for proper review.
Nevada Gaming Commission Chair Kirk Hendrick emphasized the importance of embedding compliance into the corporate culture:
Compliance shouldn’t be a burden, but an understanding that it makes this industry possible and so profitable.
Other board members expressed support for the resort’s direction, saying they’re confident in the leadership team’s ability to rebound.
Strong Hotel Occupancy and Food & Beverage Segments
While gaming revenue is under pressure, Castro said other aspects of the business are performing well.
Hotel occupancy and average daily rates are strong, and the resort’s 200,000 square feet of convention space is being utilized profitably.
The food and beverage segment is also seeing solid returns, though Castro sees potential for growth. Josef Wagner, formerly of MGM Resorts’ Bellagio, has been hired to lead Food & Beverage operations.
Retail is also undergoing major changes, with new executives brought in to improve lease performance and retail branding. Castro said the resort is also aggressively looking for cost efficiencies.
The team has done an excellent job of going after areas of inefficient opportunities
The COO explained, adding that positions previously eliminated to streamline costs will be gradually reinstated, particularly those tied to revenue generation.
It’s just a shift in the business model for the time being as we ramp up and return to stability
Security wages have also been increased to remain competitive and reduce turnover, a move praised by the Nevada Gaming Control Board.
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