Friday, Aug. 14, 2009 | 11:08 a.m.
Beyond the Sun
With business down about 22 percent at its Mesquite hotel-casinos, Black Gaming LLC warned again today that it's in default on its loans and may be headed for bankruptcy protection.
The Las Vegas company said in a regulatory filing that for the quarter ended June 30, it lost $4.829 million on revenue of $27.3 million.
In 2008's second quarter the company lost $20.3 million on revenue of $36 million. Those results included a $12.5 million charge against earnings to write down the value of the company's assets.
In the latest quarter, Black said its liabilities totaled $233.5 million -- including $205.7 million in debt that's in default.
Casino revenue during the quarter fell year-over-year 22.4 percent to $16.5 million, while hotel revenue fell 24 percent to $6 million as the Mesquite properties entertained fewer visitors and hotel-casinos 80 miles away in Las Vegas offered stiff competition.
Black Gaming owns the CasaBlanca and Virgin River hotel-casinos as well as the Oasis, where business has been suspended due to the recession.
Black said that on July 15, it failed to make two interest payments due at that time of $5.625 million and $4.208 million.
"If the company is not successful in obtaining a forbearance agreement, a restructuring agreement or entering into a transaction to address its liquidity and capital structure, the company will likely be required to seek protection under Chapter 11 of the U. S. Bankruptcy Code," Black Gaming said in today's filing.
"The broader economic slowdown being experienced in Nevada and the region will likely adversely impact discretionary spending for leisure and other recreational activities, such as gaming and resort services offered by our resorts. Markets with which we compete, such as hotel-casino resorts in Las Vegas and elsewhere, are offering discounted room and other packages in an effort to attract customers, including customers who traditionally might have come to our resorts," the filing said. "Because our hotel-casino resorts are heavily dependent on the drive-in market, especially leisure travelers traveling on Interstate 15 and Las Vegas area residents, the factors identified above have had and will continue to have an adverse impact on our business. We believe that the operating results discussed below reflect the impact of such macroeconomic factors on our business, and, in the short-term, we do not anticipate the macroeconomic conditions to improve. As a result, we anticipate continuing pressure on our operating results."