Rekubit Exchange:Atlantic City casino profits fall 7.5% in 3rd quarter of 2023

ATLANTIC CITY,Rekubit Exchange N.J. (AP) — Atlantic City’s casinos and two internet-only entities earned $281.2 million in the third quarter of this year, a decline of 7.5% from the same period a year ago, New Jersey gambling regulators said Tuesday.

Figures released by the state Division of Gaming Enforcement show that while the nine casinos collectively surpassed the level of profitability they enjoyed in the third quarter of 2019, before the COVID-19 pandemic, that was largely due to the strong performance of the two newest casinos, and an accounting change by another one.

Hard Rock posted a gross operating profit of $44.3 million in the third quarter, up less than 1% from a year earlier. And the Ocean Casino Resort had a profit of $43 million, up more than 10% from a year earlier.

Gross operating profit reflects earnings before interest, taxes, depreciation, and other expenses, and is a widely accepted measure of profitability in the Atlantic City casino industry.

“In keeping with the experiences of many resort communities along the New Jersey shore, Atlantic City saw a bit of a cooling off in summer 2023 compared to the pent-up post-pandemic energy seen in 2021 and 2022, said Jane Bokunewicz, director of the Lloyd Levenson Institute at Stockton University, which studies the Atlantic City casino industry. ”That said, it did outperform pre-pandemic 2019 for both net revenue and gross operating profit, suggesting that this could be part of a cycle of stabilization.”

James Plousis, chairman of the New Jersey Casino Control Commission, noted that third-quarter gross operating profit was the third-best in Atlantic City since 2008, despite negative effects from a cybersecurity issue affecting the parent companies of four casinos.

The Borgata reported a profit of $73.5 million, down 1.7% from a year ago. But the gaming enforcement division said the Borgata recently changed the way it treated some rent expenses, moving them from the category of an operating expense to a non-operating expense for accounting purposes.

That significantly increased the amount of the casino’s reported gross operating profits, the division said.

The Tropicana had a profit of $36.7 million, down 11.5%; Harrah’s had a $30 million profit, down over 13%; Caesars had a $21.1 million profit, down nearly 18%; Golden Nugget had an $11 million profit, nearly 4%; Bally’s had a $7.3 million profit, down over 32%; and Resorts had a $7.2 million profit, down nearly 43%.

Among internet-only entities, Caesars Interactive Entertainment NJ had a $5.1 million profit, down 18%, and Resorts Digital had a profit of nearly $1.6%, down nearly 50%.

For the first nine months of this year, the casinos and the online operations earned $632.1 million, down 4.2% from the same period a year earlier.

In terms of casino hotel rooms, Hard Rock had the highest occupancy in the third quarter at over 96%; Golden Nugget was lowest at just over 67%.

The highest average nightly room price was $346.87 at Ocean; the lowest was $147.89 at Resorts.

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