2016 A Good Year for Casino Profits in Atlantic City
Yearly revenues have been released in Atlantic City to show that casinos earned a profit for 2016.
Casinos across the United States strive to earn top numbers when it comes to revenues to be the top operating state in the country. Of course, Nevada always takes the top spot and Pennsylvania creeped up a few years ago and passed Atlantic City to take the number two spot, as Atlantic City began to suffer from less than stellar revenues. However, for 2016, the New Jersey gaming city seems to have seen a turnaround with the majority of the casinos in operation seeing a profit increase for the year.
On Friday, the New Jersey Division of Gaming Enforcement released the figures for 2016 which showed that the seven casinos in operation in Atlantic City earned $3.51 billion for the year. This was an increase of 0.4%. When looking at year-on-year comparisons, Atlantic City casinos saw a gross operating profit of $587.4 million which is a 7.3% increase for the year.
It is important to note that the 2015 totals would have included the Trump Taj Mahal casino for the entire year. For 2016, the venue was closed down in early October and actually had been seeing less revenues for quite some time. So, the casinos were actually able to beat 2015’s totals with less operating space in 2016.
The revenue gain for the year was led by the casino sales which were up just under one percent with a total of $2.52 billion earned. Entertainment revenues came in at $154.5 million which is a gain of 2.1%. As far as room revenues are concerned, the state reported $405.4 million in earnings which is a decline of 0.2%.
Taking a look at food and beverage, there was also a decline. For 2016, this sector brought in $431 million which is a 2.2% decline. Revenues are also created for New Jersey from third party businesses. These are groups that lease space on the property of a casino to provide dining, entertainment, retail products or hospitality services. This sector was flat at just over $208 million.
How Did the Casinos Perform Individually?
Currently, there are seven casinos in operation in Atlantic City. The leader for 2016 was the Borgata Casino who saw an increase in revenues of 13.3% with $244.7 million in earnings. The Golden Nugget came in second with $29 million in revenues which is a massive increase of 28.1%.
On the opposite end, Caesars Entertainment venues did not do well. All three Caesars properties in Atlantic City saw declines. Harrah’s was down 3% earning $119.1 million for the year with Caesars AC dropping to $80.3 million, a 3.7% decrease. Bally’s was down as well with $39 million in earnings and a 2.5% drop for the year.
When it comes to online gaming, the Division of Gaming Enforcement decided to provide totals for Caesars Interactive Entertainment New Jersey in the report as well as Resorts Digital. Caesars Interactive was up 143% from the previous year with $9.77 million profits. Resorts Digital was up as well with $20.4 million in earnings.
When 2017 comes to an end, it will be interesting to see how well the casinos perform with only 7 in operation. 2018 will be an even better year as several venues are in the works including TEN and the former Trump Taj Mahal turning into the Hard Rock Hotel & Casino Atlantic City. It may take another year for serious gains to be seen but as investments are being made now, they will pay off in the near future.