Riviera owner announces quarterly loss of $1 million

Tuesday, Aug. 9, 2005 | 11:07 a.m.

The owner of the Riviera hotel and casino reported a loss of $1 million compared with a profit of $829,000 in the second quarter of 2004.

Revenue at Riviera Holdings Corp., which also owns a sister property in Black Hawk, Colo., rose 1 percent to $53.3 million. Revenue at the Riviera in Las Vegas rose 3 percent to $40.5 million. In Black Hawk, revenue fell 5 percent to $12.8 million.

Company executives noted that traffic problems resulting from a rock slide hurt its Black Hawk business and that $500,000 in one-time promotional spending touting the Strip hotel's 50th anniversary hurt its Las Vegas comparison.

Occupancy at the Riviera in Las Vegas was 95 percent, even with a year ago. The average daily rate was $73, up 17 percent.

"In the past, Riviera was not able to increase room rates as quickly as some of our competitors at the south end of the Strip," Riviera Las Vegas President Robert Vannucci said in a statement. Vannucci said the property expects to accelerate room rates as new development moves north.

Convention and people paying group rates occupied 42 percent of rooms at the Riviera. These groups paid higher room rates but didn't spend as much in the casino as typical gamblers, Vannucci said.

Entertainment tickets sold to cash customers were down 25 percent in the quarter, lowering traffic in the casino and as a result, slot play, he said.

The company, which doesn't often spend money on corporate advertising, also spent half a million dollars on promotions surrounding the Riviera's 50th anniversary in Las Vegas.

Earnings before interest, taxes, depreciation and amortization -- a key indicator of casino profit defined as operating cash flow -- fell 6 percent to $440,000 at the Las Vegas property.