Casino news source: Asbury-Park Press - http://www.app.com
Loss grows after Trump fails to find casino buyer
Posted by the Asbury Park Press on 08/7/07
Trump Entertainment Resorts Inc., the Atlantic City casino company that failed to find a buyer after a three-month search, reported a second-quarter loss that was wider than analysts estimated on competition from Pennsylvania casinos.
The loss grew to $13.5 million, or 43 cents a share, from $4.93 million, or 16 cents, a year ago. Revenue fell 4.6 percent to $244.2 million from $256 million, the company said today in a statement.
Since emerging from bankruptcy in May 2005, the company founded by real estate developer Donald Trump has lost money in every quarter except one. Trump's three Atlantic City casinos are facing competition from five casinos that opened in Pennsylvania within the last year and a slot parlor in Yonkers, New York. Chief Executive Officer Jim Perry resigned July 1.
"Trump has been hurt by a confluence of events,'' said Frank Fantini, publisher of the Gaming Morning Report and a casino consultant based in Dover, Del.
Promotions by competing casinos in Atlantic City and a partial smoking ban there added to pressures on revenue from new locations in Pennsylvania and New York, the company said.
Trump Entertainment shares slipped 3 cents, or 0.5 percent, to $5.48 at 9:36 a.m. in Nasdaq Stock Market composite trading. They had slumped 56 percent since June 29, the last trading day before the company announced efforts to sell itself failed.
Six analysts surveyed by Bloomberg estimated a loss of 29 cents a share, on average, while four predicted revenue of $250.2 million.
Revenue per available room, considered a key measure in the hotel industry, rose 13 percent to $82.51 as occupancy increased to 89 percent from 85 percent, the company said.
In March, Trump Entertainment hired Merrill Lynch & Co. to explore a sale. It held negotiations with a group of investors that included Dennis Gomes, the former manager of the Trump Taj Mahal. Last month, Trump Entertainment said offers it had received weren't likely to lead to a transaction, sending the stock to its biggest daily drop in two years.
Donald Trump, whose television program "The Apprentice'' professed to show how a business should run, has struggled to make money for investors in his casinos. Three of his properties went bankrupt in the early 1990s. He led the company through nine years of losses and six months of bankruptcy before relinquishing the chief executive officer post in 2005. |
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