business

A.C. casino revenue fell 6.8% last month

Suzette Parmley, Inquirer Staff Writer

Updated: Friday, May 11, 2007, 2:28 AM

ATLANTIC CITY - In the most significant sign yet of the impact here of competition from Pennsylvania slots, the resort's 11 casinos reported a 6.8 percent decline in revenue last month from a year ago.

Nine of the 11 casinos reported declines for the month, ranging from 3.4 percent at the Borgata Hotel Casino & Spa to 19.7 percent at Trump Taj Mahal.

The casinos reported $396.8 million in revenue compared with $425.9 million in April 2006.

"I expected it to be bad, but not quite that bad," Tony Rodio, president of Resorts Atlantic City and the Atlantic City Hilton, said of yesterday's numbers from the New Jersey Casino Control Commission, which tracks Atlantic City's gambling market.

Both of Rodio's casinos were down for the month: Resorts, 7.4 percent, and the Hilton, 8.6 percent.

"Without a doubt, it was a combination of different factors," he said. "First and foremost, Pennsylvania continues, and will continue, to have an impact for the balance of the year.

"Also in April, we had one less Saturday, some bad weather - with a nor'easter which ruined one weekend - and then obviously, the partial smoking ban went into effect," Rodio said. "That certainly is having an impact as well."

Like Rodio, Wall Street analysts attributed the huge hit mostly to slots parlors in Pennsylvania and the casino smoking restrictions that took effect April 15, which confined smoking to 25 percent of the gaming floors.

"Atlantic City faced the double whammy" of new slots competition and the smoking ban, said Andrew Zarnett of Deutsche Bank AG. "The near future will be very challenging for the Atlantic City market as the regional competition continues to evolve."

Pennsylvania's four operating slots parlors took in $76 million in revenue last month.

Additional slots parlors in Bethlehem, Philadelphia and the Poconos "will hit Atlantic City harder than the current facilities have," he said. "Those properties that offer a destination resort and a high-end environment will be winners."

Of the $396.8 million in the April gambling win, $284.4 million came from slot machines, and the remainder came from table games. Slot-machine revenue was down 12.3 percent from a year ago, and table games revenue dipped 3.1 percent.

Only two casinos reported revenue increases for the month: Caesars, with a 15.3 percent jump, and Harrah's Marina, with a 1.9 percent increase. Both are owned by Harrah's Entertainment Inc., of Las Vegas.

Rodio was optimistic despite the gloomy numbers, because summer, which is Atlantic City's peak season, is just around the corner.

"Some of those things were unique for the month," he said. "As we get into the summer season, Atlantic City will bounce back and not be as impacted by the Pennsylvania racinos," or racetracks with slot machines.

Contact staff writer Suzette Parmley at 215-854-2594 or sparmley@phillynews.com.

Suzette Parmley, Inquirer Staff Writer

Read full story: A.C. casino revenue fell 6.8% last month