A.C. casino revenue down 10.6%

ATLANTIC CITY - After plans for the world's second-most-expensive casino resort were announced here this morning, a state report showed the city's 11 casinos' revenues were down 10.6 percent last month in the face of competition from new slots venues in Pennsylvania and New York.

It was the ninth consecutive month in which the casinos' monthly take was lower than it had been in the same month the prior year.

The Atlantic City casinos' total win, or the amount gamblers lost, was $419.3 million in September, compared with $468.8 million in September 2006.

So, why would MGM Mirage be willing to spend nearly $5 billion to build a gambling resort here? The company is betting that a gleaming resort with 3,000 hotel rooms, tony shopping and dining experiences, and gambling table games will attract a more well-heeled clientele from a broader geographic area. Nonelectronic table games are not permitted in Pennsylvania slots parlors.

"It doesn't help the existing operators, but it's the beginning of the re-creation of Atlantic City," Deutsche Bank AG gambling analyst Andrew Zarnett said today, alluding to September's 10.6 percent revenue decline among the 11 casinos. "The big new properties will attract a higher income, higher margin, leisure customer . . . while the older properties maintain the lower margin grind business."

The Atlantic City Convention and Visitors Authority yesterday announced a $300,000 advertising campaign in central Pennsylvania to tout Atlantic City's nightlife, restaurants and other nongambling attractions.

Nine of the casinos reported revenue declines, ranging from 0.7 percent to 21.3 percent.

Only Caesars and Showboat, both owned by Harrah's Entertainment Inc., of Las Vegas, managed to hold the line with 0.3 percent and 1.2 percent revenue increases, respectively.

The figures were released this afternoon by the New Jersey Casino Control Commission, hours after MGM Mirage announced its plans for a casino in the city's Marina District, next to the Borgata Hotel Casino & Spa.

The Borgata, while still the city's revenue leader at $62.7 million, also was hit hard last month. It reported an 11.2 percent revenue decrease, its largest monthly decrease since it debuted in July 2003.

Pennsylvania regulators said today that the state's sixth slots parlor - the $400 million Mount Airy Resort & Casino, owned by Scranton businessman Louis DeNaples - would not open Monday as planned with its 2,500 slot machines.

Regulators said the casino had yet to gather all its approvals. DeNaples is currently under a federal grand jury investigation into his background and suitability for a casino license.

About 45 percent of Atlantic City customers come from New York and North Jersey, according to the visitors agency. About 22 percent come from Pennsylvania.

But fewer are coming from that state.

Blame it on convenience, said Broomall, Delaware County, slots player George Charles Sr. An Atlantic City regular, Charles, 75, said he stopped into Harrah's Chester Casino & Racetrack today because he did not feel like driving the extra hour.

"It's hard, especially for a lot of older people who don't want to drive," he said as he worked a nickel slot machine.

Added the retired Boeing mechanic: "It's not as classy as Atlantic City, but it's real convenient."