Cash flow drops in quarter

Wednesday, April 24, 2002 | 11:12 a.m.

The parent company of the Hard Rock Hotel & Casino reported a 6 percent drop in cash flow for the quarter ended March 31, as increased marketing expenses cut into earnings.

Hard Rock Hotel Inc. reported cash flow of $7.9 million, down from $8.4 million in the year-ago quarter. As Hard Rock is privately held, cash flow is a closely followed indicator of its financial performance.

Hard Rock attributed the decline to increased marketing expenses from the production of a national advertising campaign, as well as the hosting of Howard Stern's radio show for three days in February.

"We believe that the marketing expenditures this past quarter will more than pay for themselves through increased awareness of the property, which will translate into additional future revenues," Hard Rock Chairman and Chief Executive Peter Morton said.

Net income, however, rose 25 percent to $1.5 million, boosted primarily by an $833,000 drop in interest expenses.

Revenues rose 1 percent to $31.3 million. Casino volume, table game hold and hotel occupancy all rose during the quarter, but were offset by lower slot hold and lower room rates.

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