Atlantic City Casinos Spring Forward, Double Winter Profits

First-half figures compare surprisingly well to 2018 and 2019, two 'normal' years
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After a modest $90.4 million in gross operating profits in the typically slow first quarter of 2021, the Atlantic City casino industry more than doubled that mark to $185.2 million in the second quarter.

The figures, released Monday by the New Jersey Division of Gaming Enforcement, can be compared to 2020 — also a COVID year — and a “normal” 2019. The state’s 12 casinos were open for all but two weeks of the first quarter of 2020, but profits were a paltry $29.6 million. The second quarter of 2020, with the casinos closed for all three months, produced a gross operating loss of $112 million.

Going back to 2019, the casinos made $87 million in the first quarter, followed by a Q2 figure of $159.3 million. That means the casinos, in spite of COVID fears that presumably have impacted casino attendance, made more money in the first half of 2021 ($280.6 million) than they did in the first half of 2019 ($246.3 million). In fact, the 2021 figures nearly match those from three years ago, when the casinos made $294.4 million in the first half of the year.

Borgata, long the king of Atlantic City casinos, maintained its lofty perch in terms of gaming revenue (see below for a different story regarding its hotel), with $69.4 million in profits representing nearly one-fourth of the industry total. Tropicana‘s second-place ranking ($44 million) was less expected than a respectable $34.7 million for Hard Rock that edged out Harrah’s for third at $34.4 million. Caesars, the third property owned by Caesars Entertainment, joined Tropicana and Harrah’s in the top five with $26.7 million in profits in the first half of 2021.

Ocean Casino, on the grounds of the ill-fated Revel casino’s Boardwalk property, placed a disappointing sixth at $24.9 million. Golden Nugget ($15.4 million) and Resorts ($8.4 million) didn’t make much money, but it could have been worse. Bally’s, in the midst of a badly needed makeover after being a bit of an afterthought in its last years as a Caesars property, lost money in each quarter — adding up to $10 million in the red.

Hotel occupancy down from ’19, but …

As would be expected for the first half of 2021, the casinos’ hotels couldn’t compete with the visitation level of 2019. Two years ago, the casinos had 81.5 % occupancy and an average room rate of $139.76 per night. In the first half of this year, the occupancy rate was down to 70%.

But while the number of guests declined, the average room rate actually rose to $158. Ocean casino was the big winner on this front, with equally amazing marks of 94.8% occupancy and $217.54 as the average room charge. Borgata, another of Atlantic City’s higher-end properties, managed just 49.1% room occupancy while charging an average rate of $151.33. Meanwhile, Resorts claimed the crown for the budget-minded with an average room rate of $105.30 per night.

Photo: Jim Walsh/Imagn Content Services

 

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