Earnings down in expanded Atlantic City casino market
ATLANTIC CITY, N.J. (AP) — Along with the excitement over the reopening of two of the five Atlantic City casinos that had shut down in recent years came this concern: Can a city that only just recently regained its footing as a smaller market handle the addition of two new competitors?
Figures released Friday by the New Jersey Division of Gaming Enforcement seemed to reinforce that concern.
The nine casinos collectively saw their gross operating profits decline by 15.3 percent in July, August and September compared with the same period a year ago. While everyone was still profitable, five of the seven were less so.
This was the first full quarter of operation for Hard Rock and the Ocean Resort casinos, and the competition took its toll on most of the other seven casinos. Only two reported an increase in profits — the Golden Nugget, which saw its gross operating profit increase by 6.6 percent to $13.6 million, and Bally’s, which was up only half of one percent to $18.3 million.
Hard Rock made an $8.2 million profit while Ocean Resort had $1.4 million in profits.
“Industry profits were down in light of the new competition that entered the market,” said James Plousis, chairman of the New Jersey Casino Control Commission. “On a positive note, compared to last year, over 6,300 more people were working in the industry and there were nearly 5,400 more full-time jobs.”
Hard Rock, which is the former Trump Taj Mahal casino, and Ocean Resort, the former Revel casino, both reopened on the same day, June 27.
The Tropicana saw the biggest drop in profit at $31.8 million, down more than 31 percent from the same period last year. The Borgata was down nearly 22 percent to $63.1 million, and Resorts was down 14.7 percent to $9.1 million. Harrah’s was down 5.6 percent to $35.9 million and Caesars was down 2.5 percent to $28.6 million.
Among internet-only entitles, Resorts Digital was down 83.3 percent to $2 million, and Caesars Interactive NJ was down 69.4 percent to $1.1 million.
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.
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