Making the News

Press of Atlantic City

Originally Published:Friday, December 11, 2009
http://www.pressofatlanticcity.com/news/top_three/article_7083dbd6-e5c0-11de-bd06-001cc4c002e0.html

Atlantic City casino revenue loss back to double digits in November

By Donald Wittkowski
Press of Atlantic City

ATLANTIC CITY - The city's yearlong decline in gaming revenue returned to double digits in November after two previous months of slightly more palatable single-digit decreases raised hopes that the casinos were on the verge of a recovery.

Overall, Atlantic City's casinos took in

$299.3 million in revenue for November, down 13.4 percent compared with the same month a year ago.

Slot winnings declined 9.5 percent to $206.8 million, while table game revenue plunged 21 percent to $92.5 million, according to figures released Thursday by the New Jersey Casino Control Commission.

In addition to the usual problems associated with the weak economy and competition from slot parlors in surrounding states, the gaming industry had to contend with an unfriendly calendar and a coastal storm that battered Atlantic City with heavy rain and strong wind.

"I was the only one walking on the Boardwalk, in my raincoat," Don Marrandino, president of the four casinos operated by Harrah's Entertainment Inc., said while describing how the storm scared away customers.

All 11 casinos had lower revenue for the month.

So far this year, revenue has slipped 13.5 percent industrywide to $3.67 billion and is on track to finish at a 12-year low.

"It appears for the first time since 1997, the industry is going to fall below $4 billion in gross gaming revenue," said Harvey Perkins, senior vice president of the Linwood-based casino consulting firm Spectrum Gaming Group. "In 1997, it was $3.9 billion. We once thought we would never see that again."

Tighter consumer spending during the recession and more competition from slot parlors in Pennsylvania and New York have cut into Atlantic City's revenue. November marked the 15th straight month that casino winnings declined.

The casino slump has not been confined to Atlantic City. Nevada, which is a month behind New Jersey in reporting its gaming revenue, posted an 11.6 percent decline statewide in October. On the Las Vegas Strip, gaming revenue was $426.3 million, off 10.3 percent. October represented the 22nd consecutive month of declining revenue for Nevada's casinos, which are down 10.6 percent for the fiscal year.

September and October brought some hope that the worst was finally over for Atlantic City because revenue declined by only single digits in each of those months after a string of double-digit decreases earlier in the year. However, November's results suggest that a turnaround has not yet been sustained, Marrandino noted.

"I think that we're treading water right now," he said. "I don't think it's horrible, but the sun isn't shining yet."

Marrandino's somewhat gloomy analysis seemed appropriate for November. The remnants of Tropical Storm Ida blocked out the sun for three days starting Nov. 11.

"That really beat us up," Marrandino said of the soaking rain. "We were going pretty nicely until then, but that took the steam out of us."

In addition to the severe weather, the calendar conspired against the casinos. This November had one fewer Saturday than last year, depriving the industry of a key moneymaking weekend day.

As usual, Borgata Hotel Casino & Spa was the top-grossing casino, pulling in $52.5 million for November, although its revenue was down 8 percent. Only Showboat Casino Hotel, off 1.9 percent, and Harrah's Resort, down 3.9 percent, joined Borgata in posting single-digit declines.

Trump Plaza Hotel and Casino was the worst performer, suffering a 25.8 percent revenue decline. Caesars Atlantic City, Resorts Atlantic City and the Atlantic City Hilton Casino Resort also saw their revenue fall by more than 20 percent.

Contact Donald Wittkowski:

609-272-7258

 

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