Gaming news briefs for May 6, 2004

Thursday, May 6, 2004 | 11:10 a.m.

Casino purchase canceled

ST. LOUIS -- Isle of Capri Casinos Inc. has scrapped plans to buy the St. Louis waterfront's President Casino on the Admiral, opting instead to focus on pursuing licenses for new gambling sites in St. Louis and St. Louis County.

The decision announced Tuesday -- mutually agreed upon by Isle of Capri and bankrupt President Casinos Inc. -- means President and its creditors likely will put that operation back on the market.

The President Casino, which sits on the Mississippi River near Laclede's Landing in downtown St. Louis, and its corporate parent have been under bankruptcy protection since mid-2002. Mississippi-based Isle of Capri announced last September it had agreed to buy the President for roughly $50 million, with conditions including Isle of Capri's receiving approval for new casinos in St. Louis and St. Louis County.

City and county selection committees endorsed plans by Las Vegas rival Pinnacle Entertainment Inc. for a $200 million development on Laclede's Landing and a $300 million development in St. Louis County's Lemay community.

Regardless, the Missouri Gaming Commission is considering six casino proposals for the St. Louis market, unbound by the votes of the various selection committees.

Profit falls at Vegas property

The owner of the Hard Rock Hotel & Casino in Las Vegas on Wednesday reported a decline in first-quarter profit as marketing expenses increased at the property and gamblers got lucky at the tables.

The company reported a loss of $1.3 million in the first quarter compared with profit of $2.6 million in the same quarter of last year.

Revenue increased 2 percent to $37.3 million. Excluding promotional expenses of $2.8 million, first quarter revenue was $34.5 million, up 2 percent from net revenue a year ago. The increase was primarily due to improved hotel revenue but was partially offset by a decrease in casino revenue, the company said. Average daily hotel rates increased by about $24 during the first quarter compared with last year. But casino revenue fell as the percentage won from gamblers at the tables fell about 1.7 percentage points.

Cash flow, a key indicator of casino performance, fell 26 percent to $6.5 million. The decline was attributable to increased entertainment costs related to the property's Joint music venue and increased customer promotions.

Hard Rock Chairman and Chief Executive Peter Morton said the company's first-quarter volumes in table games and slots were up from a year ago and the hotel's average daily rate was the highest for any quarter.

"We are looking forward to the opening of our new nightclub during the second quarter, which will enhance our property and which we expect will further solidify our position in the marketplace," Morton said.