Harrah's Entertainment Posts Quarterly Loss
Harrah's Entertainment, the casino giant recently purchased in a joint acquisition by Apollo Management and TPG Incorporated, announced today that it had posted a loss last quarter of $47.8 million, or 26 cents per share. The company attributed the losses to write-offs from the London Clubs International section.
Last year, the same quarter resulted in a profit of $47.6 million, or 25 cents per share. Revenue still rose last quarter, up 8.1% to $2.63 billion, in Harrah's last quarter as a publicly owned company. However, the thirteen casinos owned by London Clubs suffered, particularly those affected by new English smoking bans and jackpot limits.
Atlantic City holdings of Harrah's Entertainment dropped in income by a 0.5 % margin, not as poor as many Atlantic City casinos which have had to deal with increased competition in neighboring states. Las Vegas holdings still showed an impressive 15% climb in revenue.
Harrah's has ongoing expansion projects in the Bahamas and Spain, and is planning a new $1 billion tower addition to Caesar's Palace in Las Vegas for high-rollers. The company also recently purchased a Macau golf course, raising the possibility that Harrah's might join the rush to enter the frenzy of construction in the Macau casino world.
Due to the inconsistent and restraining policies of Prime Minister Gordon Brown, the London investments must be seen as a drag on the potential of Harrah's as a whole. If the London Clubs can be divested or stabilized, the rest of this casino company looks like a potential gold mine for its new owners.
