business

11 A.C. casinos post 22.6 percent drop in profits for 2d quarter

Suzette Parmley, Inquirer Staff Writer

Updated: Thursday, August 19, 2010, 2:04 AM

The 11 Atlantic City casinos reported a 22.6 percent decline in gross operating profits for the second quarter of the year.

Gross operating profits for the Shore gambling houses totaled $149 million for April through June, compared with $192.5 million for the same three-month period in 2009, according to figures released Wednesday by the New Jersey Casino Control Commission.

Net revenues fell 5.5 percent for the period, to $922 million.

Meanwhile, Pennsylvania casinos ramped up to table games last month and reported a double-digit increase in gross slots revenues compared with last year. Table game revenues will be released sometime after Friday, according to the Pennsylvania Gaming Control Board.

But if Delaware - which enjoyed an 11.7 percent surge in gross gaming revenue last month after adding table games at its three casinos in June - is any indication, the blackjack, poker, roulette, and other games should have a similar effect on Pennsylvania's casinos.

"Notably, the increase [in Delaware] was solely carried by the addition of table games to the properties as winnings, excluding table revenue, were down 1.2 percent," analyst Dennis Farrell of Wells Fargo Securities L.L.C. wrote Wednesday.

Atlantic City's casinos reported a 5 percent decrease in revenue last month, compared with a 17.8 percent increase among Pennsylvania's nine casinos.

The Shore town's market-leading Borgata led the industry with $44.5 million in gross operating profit, but that was down 10.5 percent from the same period a year earlier.

The steepest decline, at 43.2 percent, was at Caesars, which reported $18.7 million in gross operating profit, down from $32.9 million a year earlier.

Gross operating profits represent earnings before interest, taxes, depreciation, and other charges from affiliates.

On a brighter note, the number of occupied rooms at the casino hotels increased 0.5 percent in the second quarter, compared with the same period a year earlier. Overall occupancy increased to 85.2 percent vs. 84.6 percent. The Shore resort has just shy of 17,100 rooms.

For Atlantic City, the numbers confirm a continuing trend, and one that has prompted attention from Trenton.

On July 21, Gov. Christie outlined a proposal for the state to take over Atlantic City's tourism and gambling district, clean up the city's image, stabilize its casinos, and boost convention business.

The plan would put an end to the casinos' annual subsidy to the state's horse-racing industry - $30 million this year and $7.5 million next year, when it expires.

Another key aspect of Christie's plan is to keep all gambling revenue collected by the Casino Reinvestment Development Authority in Atlantic City, rather than distribute it statewide for redevelopment projects.

Most of the proposals require legislative approval.

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

Suzette Parmley, Inquirer Staff Writer

Read full story: 11 A.C. casinos post 22.6 percent drop in profits for 2d quarter