Thirty-seven inches of snow in February was a problem Atlantic City could do very well without. While the white stuff takes some of the edge off the sobering realization that the Boardwalk is -34% since February 2006, you know the place is in freefall when casino executives are saying they expected it to be worse. Comparing last January to that of 2008 shows a -17% dropoff just in that two-year timeframe, so regardless of whether it’s Donald Trump or Carl Icahn asserting that Atlantic City’s best years are still ahead, you’ve got to wonder what they’re smoking. The city by the sea hasn’t seen a positive year/year casino revenue comparison since August of 2008 and is highly unlikely to ever do so again.
Even as the dueling billionaires continue to fight over the carcass of Trump Entertainment Resorts, it’s an open question whether the company is worth owning. Two of its three casinos rank in Atlantic City’s bottom four for 2010 to date, with a 9% market share. (Borgata alone does twice that.) At the dismal revenue levels posted by Trump Marina (above, in happier times), Colony C(r)apital‘s Atlantic City Hilton and the creditor-owned Resorts International — $32 million aggregate in February — it’s a wonder how they stay open. This Cerberus of casinos declined 29%, 33% and 30.5% respectively last month.
Definitely proving that “flat” is the new “up” in the casino biz, Caesars Atlantic City‘s miniscule ($100K) drop in revenue gave it bragging rights, while Harrah’s Marina (-8%) could at least boast that it, too, avoided a double-digit decline. (To keep the Pennsylvania threat in perspective, three of Harrah’s Entertainment‘s four A.C. casinos still outperformed Harrah’s Chester.) The month’s shocker was the walloping absorbed by Borgata, where even a 9% slot hold could only do so much to minimize the damage. The Boyd Gaming/MGM Mirage property was -21% and its $45.5 million take pushed it back toward the pack — followed by Harrah’s Marina at $34 million — where a year ago it had enjoyed a commanding $19 million lead on its next-closest competitor. Table play at Borgata was spectacularly unlucky, -37% for the month.
Stuck firmly in the middle of the pack was the Tropicana Atlantic City ($21 million, -16%). Unfortunately, Icahn’s first decision of consequence as new Trop owner was to keep former Columbia Sussex hatchet man Mark Giannantonio at the helm. When the latter says, “We are one of the leading casinos in the convention business,” one can only think that when you have the largest hotel in Atlantic City, you’d darn well better be one of the leaders in conventions or something’s mighty wrong. The Trop’s casino revenues haven’t been the same since Aztar Corp. sold the place, so Icahn’s picked a tough row to hoe.
