Can Atlantic City Weather the Storm?

A staggering 9.9% decline in revenues to $346.2 millin this October from a year ago has thrown eleven Atlantic City casinos into the red.

What really hurt the East Coast gambling haven was the month of September. That was when scandals and financial collapses were threatening to tear apart the financial sector. A staggering 15 percentage-point decline in gambling revenues was recorded - the worst in three decades.

Steady declines
Atlantic City saw revenues from slots drop some 8.6% and 2% from table gaming by October 2008. While slots still realized some $236 million and tables $110 million, operators are concerned. Clients are facing the reality of the infamous ‘credit-crunch.'

Even ‘The Donald' watched the share price of Trump Entertainment drop by as much as 29.3% in revenues. Similar war stories are shared between many world-famous gambling havens such as the Tropicana, Las Vegas Sands and Harrah's. Many operators are predicting some tough times ahead.

Cause and cure
Tougher competition, less disposable income, smoking regulations and layoffs are some of the factors responsible for gambling declines but sentiment remains cautiously optimistic.  As a whole up to 8% declines and thousands of job losses are expected by the end of 2008 in Atlantic City.

But industry pundits say that things will begin improving in the latter quarters of 2009. As gas prices fall, more people will be likely to frequent the resorts and have greater disposable incomes. As with the 75% smoking ban, effective November 15, 2008, which will be valid for a year - more folks will feel comfortable gambling without that added limitation.