Atlantic City August revenue was a big disappointment. Normally, summer revenues soar with the ability to bring in more customers because of the summer season. This year that didn’t happen and that spells out problems for many casinos that depend on summer revenue to bring their bottom line up.
Revenue in the 11 Atlantic City casinos only totaled about $391.7 million in August. This is a decrease in 16.3% from the totals in August 2008. August wasn’t the only month where revenues were down. June had a 13.6% drop from the previous year and July wasn’t quite as bad with a 12.7% drop. Some analysts are blaming the positioning of the Labor Day weekend for the down turn. Typically some of the weekend is in August but this year in 2009 it was late in September. They also site competition from Pennsylvania slots took business away from Atlantic City. They worry about the Sands Casino Resort just opened in Bethlehem, PA will also drain money from the Atlantic City Casinos.
In an effort to save some money many of the Atlantic City Casinos are reducing capacity. That is to say they have pulled out some of their slot machines and limited the number of gaming tables on the floor. Every casino in Atlantic City has resorted to these tactics to downsize except for the Borgata Hotel Casino and Spa.
All resorts and casinos in the Atlantic City area saw a drop in revenue from the previous year, but Tropicana Casino and resort had the smallest at 6.9%. Those seeing the most devastating revenue drops were Trump Plaza Hotel and Casino where revenue fell almost 30% and Caesar’s Atlantic City with a drop of 25%.
Some argue that the decline in revenue is temporary and once casinos start to expand and create new ways of gaining revenue, percentages will start to climb. They do not see downsizing as an option to save revenues. They say revenues will bounce back once the economy starts to recover, but the question is, will that happen in time to save some of the casinos in the area who are bleeding out large sums of money and not taking in enough to survive.
In an attempt to get more people to come to the casinos the New Jersey Legislature repealed a smoking ban for the casinos. They figure more people will stay inside the casinos and gamble than gathering on the streets and sidewalks to smoke. More gambling time means more revenue.
The fall in revenue is not only limited to Atlantic City Casinos. It is across the board in the United States. Twelve states have casinos and made $4.5 billion in 2009 down 7.4 % from 2008. Some say the drop was because the saturation of casinos in some areas. Years ago, the only venues for casinos were Atlantic City and Las Vegas and there are the 12 states that have casinos and 29 states have Indian run casinos.
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