Craig Billings: Sure. Well, first, as it specifically relates to drop and handle. We’ve almost doubled handle from 2019 to 2023, and a lot of that was share taking. We have table drop that’s up almost 50% in the same period, so not too shabby. And as you know, I’ve said on several calls, trees don’t grow in the sky. But all that being said, the comps are getting tougher. And if you go to a CPI calculator online, you will find that the purchasing power of $1 today is the same as about $0.80 in March of 2019. So for a casino and a hotel operator like, us who can reprice rooms every day and whose customers gaming bank roles reflect the current value of $1, we shouldn’t be surprised that results today when compared to the past look pretty good.
Of course, that pricing power is exacerbated by the strength of what we offer here in Las Vegas with the best service quality, the best physical experience and top-notch program. You can layer on top of that, that our target customer base, who can now earn 5 points on their money just by putting it in a bank, and that has seen pretty strong wealth creation over the past several quarters. It’s a pretty powerful EBITDA setup. Of course, by the way, the vast majority of our deployed capital here and our debt is in yesterday’s dollars. So that EBITDA setup also works wonders for returns and discretionary free cash flow. I digress slightly, but when do things go from absolutely unbelievable to just really great? I don’t know the answer to that. The best I can do is give you a clear picture of what we’re seeing right now as I did in my prepared remarks with respect to April, and it’s good.
Carlo Santarelli: Thank you.
Operator: Thank you. And our next caller is Joe Greff with JPMorgan. You may go ahead, sir.
Joseph Greff: Good afternoon, everybody. My first question is on Macau and follows up on Carlos’ Macau related promotional question. If we look at the 1Q, the conversion of gross gaming revenues to be at casino (ph) revenues, was at a better clip than it was in the fourth quarter and all of last year by quarter. How much of that sequential improvement over the last couple of quarters? Is it just a function of maybe of high hold versus maybe you’re operating the business differently than maybe some of your peers who are seeing that relationship sequence less favorably for them than it has for you?
Craig Billings: Yeah. Thanks, Joe. It has a lot to do with the revamp of our loyalty program and the fact that we have given our customers choice in terms of how they want their reinvestment. And so in any given quarter, those choices change and some of those choices flow to contra revenue and some of those choices flow to OpEx. So that’s really the primary driver. It’s not an indicative of a systemic change in the aggregate reinvestment.
Joseph Greff: That’s all for me. Thank you.
Operator: Thank you. Our next caller is Shaun Kelley with Bank of America. You may go ahead, sir.
Shaun Kelley: Hi. Good afternoon, everyone. Thank you for taking my questions. Craig or Julie, I just wanted to ask about maybe the Macau OpEx trajectory. Obviously, you’ve driven and sounds like you expect to continue to see some pretty great operating leverage there. But it is — as we’re still normalizing in that market, it’s probably a little bit tougher for us to get a sense of just sort of underlying core expense growth or inflation. So kind of any comments as things start to annualize and normalize a little bit? How much kind of on a year-on-year basis you’d expect that to level off to maybe in the back half of the year?
Julie Cameron-Doe: Sure. Hey, Shaun. So I’ll take that one. Yeah. We’ve talked quite a bit about OpEx and how we’ve been very disciplined in managing it and how we’ve been able to accommodate the non-gaming OpEx that we have to spend to meet our concession commitments. So we’ve been really disciplined. We had OpEx per day of $2.63 million in Q1. So it’s still well below Q1 ’19 levels, and it’s only up 3% sequentially. It was a big Q in terms of what we call tentpole events. And it’s — obviously, the OpEx increase is well below the 10% we’ve had sequentially in operating revenue. So we had — we were really pleased with the flow-through there. Going forward, we’re going to continue to be really disciplined around OpEx. We have good line of sight to the events calendar and how we’ll continue to incorporate that.
So as we have our EBITDA margin at both properties above Q1 ’19 levels and our OpEx were well controlled, we really expect revenue mix to be the key driver of margins going forward. We’re going to have some quarter-to-quarter variation as we see different events on the calendar, and we continue to roll out programming. But we feel pretty good about what we’ve managed to land with OpEx. And we see potential for some quarters to be slightly inside of that $2.63 million. And maybe in a bigger quarter, it might be slightly outside of that, but overall, we’re in a good place.
Shaun Kelley: Super. Thank you. And just as my follow-up, Craig, to go back to sort of the Las Vegas macro commentary, I mean, I think what many of us struggling with that I’m sure you’re familiar with this in conversations with industry executives is just, there have been some comments out there about some leisure, even at the high end, some leisure pushback when maybe the product mix isn’t perfect. And I think, in some cases, it looks like wind is kind of perfect on many of these metrics. But I’m just curious, as you look through all the KPIs across your business, did you see any area of skittishness? I mean, any area that you would consider normalization or movement around or the truth is the dynamics are alive and well there. And again, we may just need to be looking somewhere else across the strip or outside of Las Vegas to see that change in the consumer right now?
Craig Billings: Yeah. Sure, Sean. Not really. So if you think about what’s happening in Vegas, those who have deployed capital in Vegas over the course of the past five years, it actually hasn’t been so much — at least innovative capital. It actually hasn’t been so much the industry. It’s been the sphere, it’s been the Raiders. It’s been smaller, but still impactful capital deployment here that has driven all kinds of demand to the market. And you’ve heard our competitors talk about this as well, and we have a unique position in the market. So again, I’ll say it, trees don’t grow in the sky and comps get tougher and tougher over time. But from a pricing power perspective, we feel great, certainly relative to the rest of the strip. Brian, do you have any comments on what we’re seeing in the booking window at this point?
Brian Gullbrants: Yeah. I mean, everything is pretty much a result of retreated back to what it was in 2019 with respect to bookings. And when you look at the pace of group, we continue to pace to have our best year ever over ’23, which was our best year ever, and ’25 and ’26 are pacing nicely, not just in group, but we’re seeing that across the board. So I think continuing to focus on our people, our assets, our experiential events that we put together really allow us to just drive price and continue balance all our channels.
Craig Billings: And what it means by 2019 is that it’s reverted to a normal very normal booking process.
Brian Gullbrants: The booking windows are back to normal and it’s quite nice.
Shaun Kelley: Very clear. Thank you so much.
Operator: Thank you. Our next caller is Dan Politzer with Wells Fargo. You may go ahead.
Daniel Politzer: Hey. Good afternoon, everyone. Just one quick one on Las Vegas. Just in terms of your occupancy at that property, I mean you typically run in the high 80s there. I mean you’re getting as much rate as it looks like you want. I mean fundamentally, is that property structurally different in that relative to the Macau properties where you run occupancy close to 99%. It just seems like, I know there’s a balance there, but any reason occupancy in Vegas couldn’t go higher as you keep pushing rates up modestly?
Craig Billings: Sure. So first and foremost, and this is true company-wide, we never want to be in a position where we have to walk someone because we don’t have their room type or we don’t have their room available for them. Second, at some point, the experience on the property actually degrades if you get to use an extreme 99% occupancy. So we’re always balancing occupancy and rate in order to drive strong revenue results, but also maintain a great experience on the property. Macau is very different. Macau, there is a decent amount of occupancy that occurs on the day. So you have people that are in market and we will offer them a room while they’re in market. So you have the ability to drive up that occupancy very, very close to 100%.
So it’s really just a difference in market dynamics. And can we run higher in Vegas? Sure, we could. We could do that. And at times, we do. We do run higher and then it washes out later in the quarter where we run lower. It’s really just a question of the on-premises’ experience and maximizing revenue.
