Harrah's posts profit, but revenues still decline

LAS VEGAS, Nevada -- Harrah's Entertainment posted a fourth-quarter profit of $298.3 million even though the company saw revenues continue to decline due to poor customer spending.

Revenues declined 7.9 percent to $2.1 billion in the fourth quarter ending Dec, 31, down from $2.28 billion posted the same time in 2008.

For 2009, revenues dropped 12 percent to $8.9 billion from $10.13 billion in 2008. Despite the decline, Harrah's posted a profit of $846.4 million for the year.

Cash flow, defined earnings before interest, taxes, depreciation and amortization, declined 7.7 percent to $418.6 million for the quarter. Cash flow fell 12.1 percent to $2.07 billion in 2009.

The profits come after steep write downs in 2008 that saw the company post a $5.27 billion loss that year.

"The impact of the economy on consumers' willingness to spend continued to affect our results throughout 2009," Harrah's Chairman and Chief Executive Officer Gary Loveman said in a statement. "The cost-reduction programs implemented at the end of 2008 helped mitigate the economy's impact on our operating margins last year."

Las Vegas, which accounts for nearly 30 percent of the company's business, revenues declined 10 percent in the fourth quarter to $649.2 million from $721.4 million in the fourth quarter 2008.

The company in a release blamed the decline on "weakness in the group travel business, lower spend per visitor and lower average daily room rates," despite hotel room occupancy of nearly 90 percent

Quarterly cash flow dropped 7.9 percent to $174.6 million.

In 2009, revenues in Las Vegas fell 17.1 percent to $2.7 billion and cash flow dropped 22.9 percent to $756.8 million.

The company owned eight hotel-casinos locally last year including Caesars Palace, Rio, Harrah's Las Vegas, Paris Las Vegas, Bally's, Flamingo, Imperial Palace and Bill's.

The company acquired Planet Hollywood Resort last week.