Atlantic City Casinos Boast Troubling 1st Quarter Losses In 2010

May 20th, 2010- By Bryan Cross

In the United States, Atlantic City has the second-largest market for gambling, with Las Vegas being the largest.  Of the 11 casinos, nearly half are on the market to be sold, with as many as three potentially unable to sustain day-to-day operations after the total revenue generated declined by 8 percent in the first quarter of this year.

One example is the Atlantic City Hilton.  This casino has posted losses of $8 million, while currently under a $24 million loan from lenders.

In conjunction with competition from their neighboring states of Pennsylvania and Delaware, Atlantic City has struggled in the first four months of 2010.

“Atlantic City has a little too much gaming capacity right now,” remarked Cory Morowitz, who is a casino analyst close Atlantic City. “When you introduce competition into a market, the older, less-capitalized businesses tend to fall by the wayside. That’s clearly what’s happening in Atlantic City.”

In 2009, by December, revenue had dropped nearly 25 percent from 2008, and signs are not improving.  Dropping from an annual revenue of $5.2 billion to $3.9 billion in 2009, Atlantic City casinos are feeling the effects of a wayward economy.

The Atlantic City Hilton is widely considered the casino that is in the most danger currently, between their current debt and loan situation.  Colony Capital LLC is a hedge fund based out of Los Angeles is an associated company with JPMorgan Chase & co that lent the casino the money.

“In addition, the company is evaluating a range of financial and strategic alternatives to address its operating results and financial position,” said the Hilton by way of a statement.

With the struggling casinos, New Jersey Online Casinos are likely finding it difficult to thrive under the current market.

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