Hooters loses $3.9 million, says bankruptcy still possible

By Steve Green

Friday, May 14, 2010 | 6:25 p.m.

The privately held Hooters hotel-casino in Las Vegas lost $3.9 million in the first quarter as revenue fell.

The loss was about even with the $4 million lost in the first quarter of 2009.

Net operating revenue of $11.3 million in the 2010 first quarter was down from $13.3 million in the year-ago quarter.

Company owner 155 East Tropicana LLC issued the same warning Friday it has issued the past few quarters about the 696-room property’s financial condition.

"The company does not believe it will be able to generate sufficient cash flows from operations to fund its financial commitments over the next year and cannot provide any assurances that it will be able to raise additional capital," Hooters said in its quarterly report, adding it may need to see bankruptcy protection if creditors accelerated payment demands.

The property on Tropicana Avenue east of the Las Vegas Strip said hotel revenue in the first quarter fell 7.8 percent year-over-year as the average daily room rate fell from $52 to $46.

Amid stiff competition because of an oversupply of hotel rooms, Hooters did manage to lift its occupancy rate from 83 percent in the first quarter of 2009 to 86 percent for the 2010 first quarter.