AC casino profits up 31 percent in hopeful sign for city
Atlantic City's casinos saw their collective operating profit rise by 31 percent in the first three months of the year in another hopeful sign that the struggling industry may be stabilizing.
Figures released Monday by the state Division of Gaming Enforcement show the eight casinos reported a collective first-quarter profit of $106.5 million, compared with $81.3 million in the first quarter of 2015.
The Trump Taj Mahal was the only casino to post an operating loss, though it was half the casino's loss in the first three months of 2015.
Matt Levinson, chairman of the New Jersey Casino Control Commission, said he expects things to continue to get better as the city recovers from the shock of losing four of its 12 casinos in 2014.
"Revenues are up, third-party sales are up, occupancy is up and the average room rate is up," he said. "As we go into the summer season, I anticipate that revenues and profits will continue to go up, and the overall health of the industry will continue to improve."
The surviving casinos have been doing better over the past year as they adjust to a smaller market with less competition. But those gains may prove short-lived: Voters in November will decide whether to end Atlantic City's statewide monopoly on casino gambling. The measure would allow two new casinos in the northern part of the state near New York City, which stands to cause additional harm to Atlantic City and possibly force additional casinos there to shut down.
Seven of the eight casinos reported increased gross operating profit for the first quarter of the year. 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 Tropicana reported the biggest increase, up nearly 206 percent in the first quarter to $7.3 million compared with the same period last year.
The Golden Nugget was up nearly 65 percent to $6.7 million; the Borgata was up nearly 24 percent to $47.6 million; and Bally's was up 23.5 percent to $5.6 million.
Caesars was up 2.5 percent to $15.3 million; Harrah's was down 3.1 percent but still turned a profit of $26.8 million.
Resorts showed a profit of $494,000, compared with a loss of $339,000 in the first quarter of last year.
For Internet-only operations, Caesars Interactive-NJ posted a first quarter profit of nearly $2.5 million, compared with a loss of $616,000 a year ago. Resorts Digital saw a $1.2 million loss, compared with a loss of nearly $1.1 million in the first quarter of 2015.
The average hotel room cost just under $100 for the quarter, with the highest average at the Borgata ($128.26) and the lowest at the Golden Nugget ($73.07).
The occupancy rate in the city's casino hotels for the first quarter of 2016 was 73.8 percent, up 1 percent from the same period a year ago.
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