Atlantic City revenuetakes a hit in April

May 15, 2007 5:38 AM

Proving that Pennsylvania’s slot casinos are having a significant impact, Atlantic City’s 11 casinos reported a 6.8 percent decline in revenue in April compared to a year ago.

Also hampering casinos’ bottom line were adverse weather conditions and curbs on smoking that went into effect last month.

Nine of the 11 casinos reported declines for the month, ranging from 3.4 percent at Borgata to 19.7 percent at Trump Taj Mahal.

Overall, casinos reported $396.8 million in revenue compared with $425.9 million in April 2006.

"I expected it to be bad, but not quite that bad," said Tony Rodio, president of Resorts Atlantic City and the Atlantic City Hilton. Both casinos were down for the month: Resorts, 7.4 percent, and the Hilton, 8.6 percent.

"Without a doubt, it was a combination of different factors," he said. "First and foremost, Pennsylvania continues, and will continue, to have an impact for the balance of the year.

"Also in April, we had one less Saturday, some bad weather ”¦ and then obviously, the partial smoking ban went into effect."

Wall Street analysts attributed the huge hit mostly to slots parlors in Pennsylvania and the casino smoking restrictions that took effect April 15, which confined smoking to 25 percent of the casino floors.

"Atlantic City faced the double whammy" of new slots competition and the smoking ban, said Andrew Zarnett of Deutsche Bank AG. "The near future will be very challenging for the Atlantic City market as the regional competition continues to evolve."

Pennsylvania’s four operating slots parlors took in $76 million in revenue last month.

Additional slots parlors in Bethlehem, Philadelphia and the Poconos "will hit Atlantic City harder than the current facilities have," Zarnett said. "Those properties that offer a destination resort and a high-end environment will be winners."

Only two casinos reported revenue increases for the month: Caesars, with a 15.3 percent jump, and Harrah’s Marina, with a 1.9 percent increase. Both are owned by Harrah’s Entertainment Inc.