Profit declines at hotel-casino

Thursday, May 17, 2001 | 10:50 a.m.

Officials with the Stratosphere Corp. are hoping a 1,002-room expansion at the Stratosphere hotel-casino will increase revenues and reverse declining earnings.

The company reported net income of $1.4 million, 68 cents a share, on revenues of $33.3 million for the first quarter of 2001, compared with net income of $1.6 million, 80 cents a share, on revenues of $34 million for the same period a year earlier.

Stratosphere reported a slight increase in casino revenue over the first quarter of 2000, but declines in revenue for hotel, food and beverage, tower and retail income. Hotel revenues were off with lower room rates, even though occupancy rates increased from 94 percent in the first quarter of 2000 to 99 percent in the first quarter of 2001.

Decreases in food and beverage were attributed to a decline in visitors to the Top of the World restaurant, and visits to the top of the tower were off due to mechanical down time for two thrill rides at the top of the structure.

The company also reported an additional $200,000 in interest payments in conjunction with the company's purchase of a retail mall within the hotel from Strato-Retail late last year.

Officials said a $75 million renovation program should improve revenues in the last half of 2001, with new rooms expected to be available in June.