![]() Newsletter Signup
Stay informed with the
NEW Casino City Times newsletter! Related Links
Related News
Recent Articles
|
Gaming Guru
Black Gaming reports lower revenue, project delays30 November 2007
LAS VEGAS, Nevada -- The softening economy has led Black Gaming, owner and operator of three of the four hotel-casinos in Mesquite, to delay planned construction projects while focusing on controlling costs at its properties, partially through job reductions. "This has been a tough year for the gaming industry," Randy Black Sr., company chairman and chief executive officer, said during a Thursday earnings call. "We've experienced difficult times and I believe this softness will extend into the near term." Black Gaming owns and operates the CasaBlanca, the Oasis and the Virgin River 80 miles northeast of Las Vegas. The hotel-casinos collectively feature more than 2,200 slot machines, 72 table games, and 2,200 hotel rooms, as well as golf courses, spas, a bowling center, movie theaters, restaurants and conference facilities. The property's customer base comes mostly from the 21,000 local residents, Las Vegas, California and St. George, Utah, 37 miles northeast of Mesquite. Third-quarter net revenues decreased 4.2 percent to $36.8 million for the three months ended Sept. 30 from $38.4 million in 2006. Net revenues for the first nine months ended Sept. 30 decreased 1.7 percent to $123.1 million from $125.2 million. The year-to-year decrease was due to a 14.6 percent increase in promotional expenses the company used to attract customers facing rising gasoline prices and tough times in housing. A reduction in labor costs is expected to save the company $1.5 million to $2 million annually, Black said. The reduction has mostly been focused in management restructuring to eliminate duplication of job duties. Two company executives, Chief Operating Officer Jonathan Lowenhar and Vice President of Marketing and Sales Scott DeAngelo, resigned in September and were not replaced with Black assuming a more active role in day-to-day operations. The company does not plan to lay off additional employees but will continue to watch costs. "We're going to analyze operations as they go," Chief Financial Officer Jason Goudie said. "Based on operations we may make different decisions in the future based on those results." The company's net loss grew 31 percent to $8 million for the quarter ended Sept. 30, from a net loss of $6.1 million in 2006. The companies' nine-month net loss grew 65.7 percent to $12.1 million from a net loss of $7.3 million in 2006. The loss was driven by $13.8 million in capital improvement projects during the year, including a casino floor renovation at Virgin River, Oasis room remodels and preconstruction costs for a planned events center at the CasaBlanca. Goudie said the company will delay construction of the events center and pull back on capital improvement expenses only spending cash to address safety and maintenance issues. Cash flow, defined as earnings before interest, taxes, depreciation and amortization, dropped 46.5 percent to $1.6 million for the quarter from $3.1 million in 2006. Nine-month cash flow fell 23.5 percent to $15.8 million from $20.6 million. Casino revenues decreased 1.4 percent to $24.9 million for the quarter from $25.3 million last year while casino revenues for the first nine months increased 3.5 percent to $81.7 million from $78.9 million last year. Hotel revenues for the quarter fell 5.7 percent to $7.2 million from $7.7 million in 2006; it increased 2.2 percent to $27 million from $26.4 million for the first nine months. Both Black and Goudie said that early results in the fourth quarter continue to be affected by the soft market. The company recently hired Anthony Toti, who had worked at Coast Casinos for 28 years, as senior vice president of casino operations. Toti is the son of Frank Toti, longtime business partner and friend of South Point owner Michael Gaughan. Copyright GamingWire. All rights reserved. Related Links
Related News
Recent Articles
|