Saturday, May 10, 2008

More A.C. Problems

For the second month in a row A.C. has been losing money. The only reason February's numbers were up year-over-year was due to the leap year. And the percentage up is less than it would have needed to be up if there were only 28 days this year. So basically things are looking to great for the casinos so far - and in this article from the Star Ledger titled A.C. losing streak continues. Heres some of the articles nuggets -

April brought no relief for the Atlantic City casinos. Revenue from the 11 gambling parlors fell 7.9 percent last month, to $365.5 million. Only Harrah's showed an increase -- of 2.7 percent, to $43.4 million.

Atlantic City has been under pressure since a partial smoking ban took effect a year ago and competition from Pennsylvania and New York kicked into high gear. High gas prices and a slowing economy also haven't helped.

The biggest losers last month were Hilton, Bally's, Caesars, Showboat and the Trump Taj Mahal, which all reported double-digit declines.

... For the first four months of the year, casino revenue has fallen 6.7 percent.

For most of us going to Atlantic City is considered discretionary spending. In general, people don't use food money, rent or mortgage funds, or a car payment to gamble with, they use their extra spending money. Most of us play with the money we can afford to lose - of course we all want to win. As the recession is accelerating - combined with the seeming exponential rise in gas and food prices - the money for the extras are just not there. For many families food and gas are the competition with Atlantic City, not New York or Penn.

On another note, the casinos can not afford to continue operations as is with the lowering of revenues. Cutbacks will have to be made. First the seasonal positions cut, then these will eventually make there way to the well-paying full time jobs in the casinos.

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