A.C. casinos continue to lose cash to Pa.'s slots
Revenue fell nearly 8% last month from Nov. '06. For the first 11 months of '07, it's down 5.3%.
Like a giant vacuum cleaner, Pennsylvania slot parlors continue to drain cash from Atlantic City's casinos. Revenue for the 11 casinos tumbled nearly 8 percent last month from November 2006.
Eight of the resort's 11 casinos reported revenue declines yesterday, ranging from 0.3 percent at Trump Marina to 21.1 percent at the Tropicana.
Overall, the resort's total gambling revenue for the first 11 months of the year was $4.5 billion, down 5.3 percent from $4.8 billion for the same period in 2006.
The figures were released yesterday by the New Jersey Casino Control Commission, which regulates the Atlantic City gambling market.
By comparison, the six slot parlors in Pennsylvania generated gross revenue last month of $101.6 million, of which state taxes take 55 percent, according to the Pennsylvania Gaming Control Board.
New Jersey taxes take 9.25 percent of its casinos' gross gambling revenue.
A bright spot for the resort's casinos was table games, which are prohibited in the Pennsylvania slot parlors. While slots revenue was down 12.2 percent at Atlantic City's casinos, table-game revenue was up 4.4 percent.
All four Harrah's Entertainment Inc. properties reported losses: Caesars was down 15.1 percent; Showboat, 10.7 percent; Bally's, 8.4 percent; and Harrah's Marina, 7.2 percent. The four combined made up more than 40 percent of the resort's $5.2 billion in gambling revenue last year.
"It's a little bit of the same dynamics," said Michael Osanloo, senior vice president of marketing for Harrah's Entertainment. "We are really going into a tough time competing against Pennsylvania and New York.
"When you think about what those properties have to offer - it's convenience, convenience, convenience."
Osanloo said the winter months would make it even more challenging for Atlantic City.
"The tough weather conditions will make convenience even more attractive," he said. "When the weather is bad, it makes it even worse."
The Borgata Hotel Casino & Spa, which completed a $200 million, phase-one expansion in the summer of 2006, was one of only three casinos to report an increase. The Las Vegas-style mega casino won $58.7 million from gamblers, up 2.1 percent from a year ago, and was tops among the city's gambling halls.
The Tropicana, the biggest revenue loser at 21.1 percent, is locked in a tough relicensing fight. The five-member commission is expected to rule tomorrow on whether to renew the casino's license.
The Tropicana's owner - Columbia-Sussex Corp. - has partly blamed Pennsylvania slots for the casino's financial problems, which it said led to 900 layoffs this year.