Summer revenue, profits rebound at AC casinos

Profits and revenue at New Jersey’s nine casinos surged in the third quarter, as the majority of COVID-19 restrictions were lifted and the state reopened.

Data released by state gaming regulators showed the casinos brought in net revenue of $968 million in the months of July, August and September this year, compared to nearly $629 million last year, a 53.9% increase.

Gross profits at the state’s nine casinos doubled to nearly $311 million in the quarter from $150 million in the same period a year ago, according to data released Nov. 22 by the New Jersey Division of Gaming Enforcement.

The hotel occupancy rate also went up to 81.3% from 72.9% during the summer 2020. The rate was 90.8% in the third quarter of 2019.

James Plousis, head of the Casino Control Commission, another state agency, noted that during the summer 2020, the casinos were just reopening from several months of COVID-19 closures. For almost the next year, they had to operate at reduced capacity in gaming, entertainment, retail, restaurants and other in-person events.

That meant a 2021 to 2020 comparison was not the best indicator of the industry’s health. Instead Plousis examined 2019 numbers and found that net revenue in 2021 was 4.2% higher than the same time period in 2019. “Atlantic City’s recovery is gaining momentum and is on track for an impressive year,” he said in a Nov. 22 statement. “The properties are to be commended for how they handled this challenge, both for their customers and employees, and are now rebounding from it.”

In September, the casinos posted more than $1 billion in sports wagers, most of them online and from mobile gambling products. The state then beat its own record in October, with patrons betting $1.3 billion at New Jersey’s sportsbooks.

“New Jersey’s gaming operators have learned to adapt to the circumstances of the pandemic and run lean and profitable enterprises,” Jane Bokunewicz, faculty director of the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton University, said in a statement.

“So far it seems operators have been able to successfully balance the currently reduced labor supply with growing consumer demand for resort amenities including lodging.”

With the Atlantic City economy primarily dependent on the casinos and surrounding hotels, unemployment during the COVID-19 closures rose to nearly 27%, one of the nation’s highest rates during the pandemic.

Now that the summer tourism season has ended and the weather is chillier, the focus in the resort has shifted to conferences, conventions, trade shows and other large events this winter.

After the closure of several casinos following the Great Recession pushed Atlantic City to the brink of financial ruin, state and local officials have been trying to diversify the city’s economy beyond gambling, with offshore wind projects and the presence of Stockton University and South Jersey Industries.

Borgata led the pack this summer, bringing in $189.7 million, followed by Hard Rock which generated in $165.7 million.

“We are pleased that the north end of the Atlantic City Boardwalk “North Beach” continues to lead the market,” said Joe Lupo, president of Hard Rock Atlantic City. “This positive growth shows the importance of investing in the city and that working collaboratively together can have a positive impact in our community.”

Ocean Resort, which opened in 2018 at the former site of the failed Revel, took in nearly $113 million, while Tropicana brought in $110.3 million in the third quarter and Harrah’s posted $108.6 million in net revenue.