atlantic city

Surviving Atlantic City Casinos Seeing Green Again

As four Atlantic City casinos shut down last year, those that remained voiced optimism that their own performance would improve.

Now, the numbers show that's exactly what is happening.

Figures released Friday by the state Division of Gaming Enforcement show the surviving eight casinos saw their gross operating profits rise by 26 percent in the first quarter of this year. The casinos posted a collective operating profit of $81.3 million, up from $64.5 million in the same period last year.

The elimination of weaker casinos has left the survivors in better financial shape — the very thing casino executives said they expected during the gloom and doom of 2014.

"Gaming revenue is up, total revenue is up, net revenue is up, gross operating profits are up, hotel occupancy rate is up and the average room rate is up," said Matt Levinson, chairman of the new Jersey Casino Control Commission. "In a quarter when it is not uncommon for casinos to lose money, six properties generated gross operating profits and a seventh cut its loss by almost 40 percent. I am optimistic that we will see continued improvements through the rest of the year as casino hotels continue to expand their non-gaming attractions."

The Golden Nugget had the biggest increase, swinging from an operating loss of nearly $1.8 million in the first quarter of 2014 to a profit of more than $4 million in the same period this year.

Caesars, which is in bankruptcy, nonetheless posted a 143 percent increase in operating profit for the quarter, to nearly $15 million. Bally's, its sister property also in bankruptcy, went from a first-quarter operating loss of $1.5 million last year to a profit of $4.5 million this year.

Market leader Borgata saw its operating profit rise by more than 82 percent, to $38.4 million. Harrah's saw its profit increase more than 30 percent, to $27.6 million.

The Tropicana saw its operating profit fall by nearly 93 percent, from $32 million in the first quarter of 2014 to nearly $2.4 million this year.

Resorts posted an operating loss of $1.4 million, but that was a nearly 40 percent improvement over their $2.3 million first-quarter loss last year.

The Trump Taj Mahal, which is also in bankruptcy and is being acquired by Tropicana owner Carl Icahn, saw its operating loss balloon from $3.2 million in the first quarter of 2014 to more than $8.7 million this year.

Casinos that closed in 2014 were the Atlantic Club, Showboat, Revel and Trump Plaza.

Gross operating profit reflects earnings before interest, taxes, depreciation, and other charges and is a widely accepted measure of profitability in the Atlantic City casino industry.

The casinos' collective occupancy rate for the first three months of the year was more than 72 percent, with the average hotel room price being just under $99. The Borgata had the highest occupancy percentage at nearly 85 percent, while the Taj Mahal was less than half full during that period.

Copyright AP - Associated Press
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