Borgata Revenues Up Nearly Seven Percent
Revenues at the Borgata Hotel Casino & Spa increased by nearly 7 percent in the third quarter of this year as Atlantic City's top casino continued to increase its grip on the market while preparing for the launch of online gambling.
The casino reported net revenues of more than $200 million, an increase of 6.9 percent. Its earnings before interest, taxes, depreciation and amortization were up nearly 40 percent to $46.6 million, largely due to better luck at table games.
"We are extremely pleased with our performance in Atlantic City," said Keith Smith, president and CEO of Boyd Gaming, which co-owns the Borgata with MGM Resorts International. "This reflects the appeal of Borgata's amenities. Over the last 10 years we have built Borgata into one of the gaming industry's strongest brands."
Smith said the Borgata -- which increased its share of the Atlantic City casino market by three percentage points, to 21 percent -- wants to lead the state's new online gambling industry. The casino received New Jersey's first Internet gambling permit, and is expected to be among the first in the state to offer online betting once it begins in late November.
He said the company is testing the geolocation and age verification technology built into its system to make sure gamblers are of legal age and physically located within New Jersey's borders, and plans to offer numerous ways for customers to open an account, including credit cards, checks and prepaid cards.
"We are going to launch a very, very strong product," Smith said. "We are going to be aggressive in terms of attacking the market to acquire players. We're ready to go."
He said the casino expects to operate multiple gambling websites, including a Borgata-themed site, one featuring online partner bwin.party, and possibly others. He said New Jersey casino regulators will permit as many as five websites per casino.
Smith also said Boyd is interested in pursuing online gambling in other states as they approve it.
Paul Chakmak, Boyd's chief operating officer, noted a recent New Jersey tax court ruling that Borgata had been overpaying its property taxes. The court ruled the casino is due at least $48.5 million, plus interest that Chakmak estimated at another $10 million. The casino is also appealing its taxes for the years 2011-2013, and Chakmak said there could be further refunds from those years.
For the first nine months of this year, the Borgata reported net revenues of $538.6 million, and earnings of $102.8 million. Both figures were essentially the same as they were in the first nine months of last year.
The Borgata opened 10 years ago, and soon became Atlantic City's dominant casino. It routinely leads the city's other 11 casinos in terms of money won from gamblers.
Meanwhile, Borgata co-owner MGM -- which had to place its 50 percent share of Borgata into a trust when New Jersey regulators objected to its partnership with the daughter of an Asian gambling magnate accused of racketeering -- said Thursday it expects the state to allow it to return by the first quarter of next year.
"We've been able to come to an agreement with regulators to reapply," said Dan D'Arrigo, MGM's chief financial officer. "We're pretty confident, even though we can't speak for the regulators."
(Copyright 2013 by The Associated Press. All Rights Reserved.)