Having seen four casinos forced to close in 2014, Atlantic City’s remaining eight casinos were able to cash in throughout 2015 with every surviving casino reporting an operating profit for the year.
The New Jersey Division of Gaming Enforcement confirmed that operating profit increased by 40 per cent across the board with GGR of US$547m up from $390m in 2014.
Casino Control Commission Chairman Matthew Levinson said: “To me, that’s an indication that the market is stabilizing after several years of turmoil. Atlantic City’s casino industry is alive and quite well. Every single operator reported a very solid performance for the year.”
The biggest turnaround came at Resorts Casino Hotel which is now under the management of Mohegan Sun. It saw a huge 525 per cent increase in profits, to $15.6m. GGR increased 3.1 per cent, to $2.5bn.
Fitch Ratings’ Colin Mansfield said: “Mohegan’s doing a very good job of managing that property,” said Gambling revenue, in 2015 among the city’s eight extant operators. And a larger chunk of revenue is dropping down to the bottom line. More broadly speaking, this has sort of been a trend over the last couple years. A lot of operators are going back and looking at their business and looking at where they can create some efficiencies and where they can take some cost out of a business.”
Elsewhere, The Golden Nugget saw an increase of more than 396 per cent to $22.6m, Bally reported a surge of 77 per cent to $39.9m, Caesars increased by more than 39 per cent to $83.4m, Borgata’s profit was up over 36 per cent to nearly $216m whilst Harrah’s increased by 26 per cent to $122m.
Even the Trump Taj Mahal saw an improvement from an operating loss of $1.1m in 2014 to an operating profit of $3.1m in 2015.
Every casino showed an increase except The Tropicana which was down over 22 per cent for the year, to $46.4m.
Joe Lupo, Borgata’s Senior Vice President of Operations, said: “Less supply in the market meant more demand for each property.”
The news wasn’t completely rosy though. When including the revenues from the four casinos, the Atlantic Club, Showboat, Revel and Trump Plaza that closed in 2014 total GGR for the industry dropped by 8.2 per cent from the $3.8bn reported in 2014.
Occupancy rate for Atlantic City’s hotels was flat last year at 74.1 per cent. Caesars had the best occupancy at 86.6 per cent with the Taj Mahal the lowest at 49.3 per cent.
February’s figures were positive though with GGR up 14.7 per cent year-on-year. The eight casinos generated $204.7m in February with the Borgata up more than 29 per cent from a year ago, to $62.8m.
Mr. Levinson said: “It’s always positive to see casino revenues going up, and there were a lot of factors that combined to make February a good month. Compared to last year, the weather was great and with Leap Year, last month had one extra day.”
At the Borgata, Mr. Lupo added: “We were very pleased with February’s results, having a record slot month combined with exceptional results in table games and poker.
A further shake up is on the horizon too with the potential of two new casinos in the North of the state being out to a referendum in November. Analysts believe two or more Atlantic City casinos could shut down if the new casinos are allowed to open.