In line with previous reports from casino economies such as Las Vegas, Atlantic City and elsewhere, Harrah’s Entertainment today confirmed that fewer visitors with less to spend have had a detrimental effect on third quarter revenues. The company has declared a net loss for the period of US$129.7 million compared to the third quarter result in 2007 of US$244.4 million net income. Revenue was down 6.8% to US$2.64 billion.
“The economic upheaval weighing on the country continued to impact our results throughout the third quarter,” said Gary Loveman, Harrah’s chairman, president and chief executive officer. “While we’re hopeful the federal government’s recent actions to restore order to the financial markets may lead to an eventual economic recovery, there is no certainty as to its timing. As a result, we believe it’s prudent to ensure our costs remain aligned with reduced levels of business activity and that we conserve cash.”
Earnings in Las Vegas fell 27% with revenue down 11%. It was worse at the Gulf Coast properties – earnings fell a massive 60%, reflecting the previous year’s insurance gain and a 6% drop in revenue, due partly to temporary
hurricane-related evacuations and property closures. In Atlantic City lower visitor volume was partially offset by results from Harrah’s Atlantic City, which benefited from a recent expansion.
Gary Loveman concluded, “Our ability to outperform our competition in certain markets once again demonstrated the benefits of operating the most geographically diverse portfolio of properties in gaming. In particular, results from the opening of the $485 million expansion at Horseshoe Hammond midway through the third quarter were strong.” (E-11.07.08)
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