Toronto postpones casino decision; Station Casinos’ best quarter in three years


toronto-postpones-casino-decisionThe Canadian city of Toronto has decided it won’t decide whether or not to proceed with plans to build a destination casino until at least October. On Tuesday, a mayoral executive committee voted to commission a study on the pros and cons of setting up a major gaming facility within city limits. An undeveloped area of the city’s waterfront has been tapped as a likely site on which to build, as has the Exhibition Place fairgrounds and the moribund Ontario Place site, while Mayor Rob Ford was an early supporter of building adjacent to the Woodbine racetrack in suburban Etobicoke (the fact that it’s his home riding had little to do with this suggestion, we’re sure).

Meanwhile, MGM Resorts public affairs VP Alan Feldman told the committee that “the further away you get from either the central business district or the water, the less likely it becomes an opportunity for us.” MGM’s first choice would be Exhibition Place, followed by the undeveloped port land. Feldman dismissed the idea of building at Ontario Place, which he referred to as “frankly a bit of a distraction.” Caesars Entertainment has also expressed interest in a T.O. casino, as has Tropicana owner Gerry Schwartz, and the Toronto Star reported that reps from Las Vegas Sands were just in town scoping out potential build sites.

Station Casinos LLC, whose 17 properties cater to locals in Las Vegas, earned a $6.8m profit in Q1 2012, a dramatic turnaround from the $11.8m loss in the same period a year earlier. The privately held firm underwent a $2.8b restructuring in 2011 after filing for Chapter 11 bankruptcy in 2009. Revenue for the quarter was up 8.4% to $318.2m, based on a 6.6% rise in gaming revenue to $230.2m and a 9.4% bump in food and beverage revenue to $60.9m. Occupancy at Station’s hotels rose from 85.4% to 89%, which, combined with an average room rate rise from $72 to $80, pushed room revenue up 17.7% to $27.9m. Chief financial officer Marc Falcone claimed the results marked the company’s best quarter in three years.

Another privately held Las Vegas-based casino operator, Affinity Gaming, reported net income of $4.1m in Q1, an improvement over the previous year’s $3.4m. Net revenues were up 4.8% to $112.8m at the company’s 12 casinos (nine in Nevada, two in Missouri and one in Iowa). Jacobs Entertainment Inc. (JEI), which operates gaming properties in Nevada and Colorado, plus horseracing operations in Virginia and video poker truck stops across Louisiana, reported net income of $4.3m in Q1 2012, compared to a $1.8m loss in Q1 2011. Net revenues rose to $98.3m from $91.8m in 2011.

Revenue at Connecticut’s Foxwoods and Mohegan Sun casinos were off by double digits in April. Foxwoods saw revenue fall 13.4% to $49.5m, while handle fell 14.2% to $600m. Revenue at Mohegan Sun was off 10.9% to $59.4m based on handle of $749.97m (-12.3%). Foxwoods CEO Scott Butera claimed the comparison wasn’t entirely apt due to the presence of two extra weekend days in April 2011.