Atlantic City casinos' profits skyrocket
Atlantic City — The Atlantic City casinos' gross operating profit soared in the first quarter of this year to more than $95 million, more than three times the amount they earned in the first quarter of 2020, when the COVID-19 shutdown wiped out half of March.
Figures released Monday by the New Jersey Division of Gaming Enforcement show eight of the nine casinos posted increases in their gross operating profit, with only Bally's posting an operating loss.
Gross operating profit includes earnings before interest, taxes, depreciation and other charges, and is a widely-accepted measure of profitability in the Atlantic City gambling industry.
James Plousis, chairman of the New Jersey Casino Control Commission, said this year's figures are not evenly comparable to the first quarter of 2020 due to the virus-related shutdown. So he chose to compare this year's performance to the first quarter of 2019, when all the casinos were operating and the pandemic had not yet occurred.
Under that comparison, the casinos' first quarter earnings this year are 11% higher than they were in he first quarter of 2019, he said.
“The strength of internet gaming and the safe return of tourists to Atlantic City are a powerful combination,” he said. “Last week’s lifting of casino capacity restrictions bolsters confidence for a strong recovery this summer.”
The market-leading Borgata posted an operating profit of more than $29 million during the quarter, up more than 28% from the same period last year. The Tropicana earned $16.2 million, up nearly 128% from last year, and Harrah's earned $9.5 million, up 224%.
Hard Rock earned $8.5 million, compared to a $4.2 million loss in the first quarter of last year; Caesars earned nearly $8.2 million, up from a loss of $593,000 in the first quarter of last year, and the Ocean Casino Resort earned $7.94 million, compared to a $574,000 loss in last year's first quarter.
The New York hedge fund that owns Ocean Casino, Luxor Capital Group LP, reached a deal last month to sell up to half of its interest in the resort to the Ilitch family. The Ilitch group owns the Motor City Casino Hotel in Detroit, the Little Caesars pizza chain and the Tigers and Red Wings.
Golden Nugget earned $4.7 million, up over 406%; Resorts earned just over $1 million, compared to a $3.4 million loss in the first quarter of 2020, and Bally's reported a loss of nearly $6.5 million, compared to a loss of over $8 million last year under previous ownership.
Among internet-only entities, Golden Nugget Online Gaming earned over $7.9 million, up nearly 24%; Caesars Interactive Entertainment NJ earned nearly $4.5 million, up nearly 20%; and Resorts Digital earned nearly $4.3 million, up over 59%.
The figures generally comport with nationwide statistics showing the casino industry is recovering from the economic hardship of the pandemic.
Earlier this month, the American Gaming Association, the casino industry’s national trade group, said the nation’s commercial casinos took in more than $11.1 billion in the first quarter of this year. That matched the industry’s best quarter in history, the third quarter of 2019.
The figures do not include tribal casinos, and only represent money taken in by casinos before paying expenses and debts.
Just over half Atlantic City's casino hotel rooms were occupied in the first quarter of this year, with the average room rate set at nearly $131 a night. The Ocean casino had the highest average room rate at $175, while Resorts had the lowest-priced at $91.
Jane Bokunewicz, coordinator of the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton University, said revenue and hotel occupancy figures for the first quarter of this year were up from the fourth quarter of last year. She called that “further sign that the industry is recovering. As the last restrictions are lifted, there is every reason to expect to see even stronger recovery in the second and third quarter data."