Atlantic City casino earnings fall 37% amid pandemic limits
ATLANTIC CITY, N.J. (AP) — Atlantic City’s casinos saw their collective profits fall by more than 37% in the third quarter of this year as they reopened with capacity limits and costly measures designed to stem the coronavirus pandemic.
In figures released Monday by the state Division of Gaming Enforcement, each of the nine casinos still reported a gross operating profit. But for eight of them, that profit was less than it was in the third quarter of last year, when there was no pandemic and casinos were operating at full capacity.
The casinos collectively earned $150.5 million during July, August and September, down from $239.6 million a year ago.
Only one casino, the Ocean Casino Resort, increased its operating profit in the third quarter, from $10.2 million last year to $24.4 million this year.
“The data released today confirms what many have already suspected: The current public health crisis has both suppressed consumer demand for brick-and-mortar casino gaming and related amenities, and increased the costs of operating these services,” said Jane Bokunewicz, coordinator of a gambling and tourism institute at Stockton University. “This is a devastating equation for casino operators and their employees.”
James Plousis, chairman of the New Jersey Casino Control Commission, acknowledged the casinos were forced to make costly investments in order to reopen during the pandemic. But he said doing so “allowed for responsible management of the casino hotels, minimizing risk and building a foundation for a successful recovery.”
Gross operating profit represents earnings before interest, taxes, depreciation and other expenses, and is a widely-accepted measure of profitability in the Atlantic City gambling industry.
Hard Rock’s gross operating profit fell 14.3% to $20.9 million; Harrah’s was down 41.5% to $19.3 million; Tropicana was down 43.8% to $18.2 million and Caesars was down 25% to $17.5 million.
Golden Nugget was down 11% to $16 million; Bally’s, which changed hands last week when Rhode Island-based Bally’s Corp. bought it from Caesars Entertainment, was down 8.3% to $13 million; Resorts was down 16.7% to $7.7 million, and the Borgata fell nearly 97% to $2.3 million.
The Borgata chose not to reopen on July 2 when most other casinos did, remaining closed while it adapted dining and other facilities to comply with virus precautions. It was the last Atlantic City casino to reopen, on July 26.
The Atlantic City casinos, like virtually all casinos in the country, are operating under restrictions due to the virus. They are restricted to 25% of capacity and cannot offer indoor dining or drinking after 10 p.m. under orders imposed by Gov. Phil Murphy.
They have also done things like install partitions and temperature-scanning cameras, and have turned off some slot machines to enforce social distancing.
Governments in several states have ordered their casinos to close as virus cases continue to increase.
For the first three quarters of this year, Atlantic City’s casinos saw their gross operating profits decline by nearly 86%, a figure that includes more than three months of closures during the late winter and spring.
The resort’s casino hotels averaged nearly 73% occupancy during the third quarter, with the Ocean casino having the highest average cost per room at nearly $246 a night; Resorts had the lowest average room rate at just over $112 a night.
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