- Legal States
Erik Gibbs May 25, 2021 3 min read
The First Quarter of 2021 Has Been Kind to Atlantic City Casinos
Atlantic City has been battling its demons for a number of years and, just as it looked like the city might be starting to show signs of stability, COVID-19 came in. That reversed all of the hard work that had been put into the city’s recovery and 2020 was a complete disaster. The good news is that it looks like things are starting to turn around once again, with the first quarter of 2021 providing significant improvements for virtually all nine of Atlantic City’s casinos.
Triple-digit Gains Come to Atlantic City
According to data from the New Jersey Division of Gaming Enforcement (DGE), Atlantic City’s casinos reported combined gross operating profits (GOP) for the first quarter of 2021 that were more than three times better than a year earlier. The GOP, which covers EBITDA (earnings before interest, taxes, depreciation, and amortization) and other charges, topped $95 million, with eight of the nine casinos seeing substantial gains. Only Bally’s was forced to report an operating loss for the period.
It would be expected that any results would be better than last year’s performance, but the first quarter of the year was even better for Atlantic City than what was seen two years ago. According to New Jersey Casino Control Commission Chair James Plousis, the results are 11% better than in the first quarter of 2019 and he adds, “The strength of internet gaming and the safe return of tourists to Atlantic City is a powerful combination. Last week’s lifting of casino capacity restrictions bolsters confidence for a strong recovery this summer.”
A Better Year Ahead
Atlantic City casinos could only watch last year as their revenue dropped 80% from a year earlier. If the first quarter of 2021 is any indication, things are going to be much better. The Borgata saw an operating profit of over $29 million for the quarter, an increase of more than 28% from last year. The Tropicana came in next, earning $16.2 million and showing a 128% improvement. Harrah’s was up 224% as it earned $9.5 million and Hard Rock earned $8.5 million, reversing the $4.2-million loss from the first quarter of 2020.
With travel and occupancy restrictions being lifted, Atlantic City’s casino hotels were booked to just over 50% capacity during the quarter. This is expected to continue to improve not only in the city but across all gambling cities in the US throughout the rest of the year. According to Jane Bokunewicz, Institute Coordinator for the Lloyd D. Levenson Institute of Gaming Hospitality and Tourism at Stockton University, “As the last restrictions are lifted, there is every reason to expect to see an even stronger recovery in the second and third quarter data.”