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Las Vegas tourism industry hopeful after brutal 4th quarter

Executives of the Southern Nevada’s publicly traded tourism companies would just as soon forget about their fourth-quarter earnings reports.

But they also have a lot to look forward to in future earnings seasons.

Just as government leaders and health-care professionals have asked the public to be patient about a return to normalcy, so must the casino, airline and gaming equipment manufacturing companies that represent the local tourism economy.

In the fourth quarter, nine of the 21 public companies the Review-Journal business staff monitors reported fourth-quarter profits totaling $716.5 million.

The bad news was that the losses for the other 12 companies came in at an estimated $2.553 billion.

Frankly, the first quarter of 2021 isn’t likely to be much to write home about either, considering that capacity restrictions will remain in place through at least May 1.

With capacity restrictions still in place, Southern Nevada resorts haven’t been able to generate much revenue in their casinos, showrooms, restaurants and other amenities.

Signs of resurgence

But look at what we have to look forward to in the second half of 2021.

It appears that after a rough start, vaccination rates appear to be on track. While having the public receiving their full doses of Pfizer, Moderna or Johnson & Johnson vaccines won’t be a cure-all, it should instill confidence in people to get back to what they enjoy doing in our resorts.

Casino companies have organized vaccination programs for their employees and even though some may believe they’ve been coerced into doing so by regulators, the end result is the same: It’ll convince visitors from afar that Las Vegas is a safe place to go for a good time.

Last week, sales representatives from the city’s major casino companies gathered in the Las Vegas Convention Center’s new $989 million West Hall for a panel discussion on the return of the convention business.

The gathering — properly socially distanced with attendees wearing facial coverings — was generally upbeat with journalists from meetings trade publications optimistic about the return of conventions and shows in Las Vegas.

Local elected officials and International Market Centers leaders held a Friday ribbon-cutting ceremony to celebrate the grand opening of the new 315,000-square-foot Expo at World Market Center, in advance of the five-day Las Vegas Market show.

The event opening Sunday in downtown Las Vegas will be one of the initial events to return since the COVID-19 pandemic started more than a year ago.

In early June, the first major trade show and expo — World of Concrete — will make its appearance, which should generate some second-quarter revenue for several companies. Representatives of Wynn Resorts Ltd., Caesars Entertainment Inc., Las Vegas Sands Corp. and MGM Resorts International are saying their convention calendars are starting to fill up.

Panelists said their companies have been investing in their products during the time there have been fewer people in their buildings.

Trains, planes and automobiles

Attendees of Global Meetings Industry Day were given tours of the new West Hall and media members also got their first look at Elon Musk’s underground people-mover transit system using Tesla electric cars. It’s an attraction that for now is unique to Las Vegas and could draw interest from tourists when The Boring Co. expands the system into the city.

And the recent announcement that Amtrak could return to Las Vegas is welcome news, especially to those who have spent untold hours sitting in traffic on Interstate 15 between Southern California and Las Vegas.

Assuming that President Joe Biden’s infrastructure plan includes new side tracks for Amtrak trains to get around priority freight trains, a Los Angeles-to-Las Vegas train route could take thousands of cars off the overused highway. Amtrak could also produce some competition for Brightline’s planned high-speed rail project between Southern California and Southern Nevada.

Planes are starting to fill up again as well, which is more good news for the city’s resorts.

While first-quarter results for Southwest Airlines and Allegiant Travel Co. aren’t likely to be anything to write home about, they’re bound to be a good starting point for the rest of 2021.

Southwest, the busiest commercial air carrier at McCarran International Airport, and Las Vegas Sands Corp., parent company of The Venetian and the Palazzo, are due to be the first to share their earnings with investors toward the end of April.

Both had disappointing fourth quarters, but both have expressed optimism in the months ahead.

Southwest’s planes are starting to fill up and the company has announced 17 new destinations, including Fresno, Palm Springs and Santa Barbara, California. The airline also has ordered 100 Boeing 737 MAX jets and will retire the oldest jets in its fleet.

Meanwhile, more and more restaurants and entertainment venues are starting to open up to larger crowds. It was announced late last week that the Electric Daisy Carnival will be conducted in May as planned. That huge electronic music festival will bring thousands of people from out of state to the Las Vegas Motor Speedway for three evenings of entertainment.

The only thing that could ruin everything is a setback in COVID-19 cases resulting from overconfident and overexuberent people who refuse to adhere to health guidelines on social distancing and wearing masks.

Investors in publicly traded gaming companies are counting on visitors doing the right thing so that we can all get back to normal.

The Review-Journal is owned by the family of Sheldon Adelson, the late chairman and CEO of Las Vegas Sands Corp.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.

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