Moody's reviews Boyd Gaming ratings, may downgrade

The ratings under review include Las Vegas-based Boyd's "Ba2" corporate family rating and "B1" senior subordinated notes.

Moody's cited a drop in gaming revenue in the local and downtown Las Vegas markets, where Boyd operates seven properties, due to economic weakness, increasing fuel costs and other costs that impact consumer spending.

The ratings service said its review will also evaluate the negative impact of competition from a year-old Four Winds Casino in New Buffalo, Mich., on Boyd's Blue Chip casino in Michigan City, Ind., and the investment burden on Boyd from its Echelon resort complex being built on the Las Vegas Strip.

Moody's affirmed the "SGL-2" speculative grade liquidity rating it holds for the company, saying that although it has challenges Boyd will still see positive cash flow after interest, taxes, dividends and maintenance capital expenditures.

The ratings service said it does not rate Boyd's $4 billion revolving credit facility.