The news comes the day after the company reported a second quarter loss of $844,000, down from $2.2 million in the same year-earlier period. The improvement is due in part to lower financing costs. In June, ACEP and Goldman Sachs Mortgage Co. restructured the term loans related to the company's $1.2-billion sale in 2008.
Occupancy at the Stratosphere reached 95.5% during the second quarter, down from 97% in the same year-earlier period, and the average daily room rate came in at $44.93. The ADR was higher at the 258-room Arizona Charlie's on Decatur but average occupancy there was just 54.5%. The 303-room Arizona Charlie's on the Boulder Highway performed the worst, posting an average occupancy of 51.6% and an average room rate of $39.35. Its Aquarius property in Laughlin produces an average occupancy o 47.7% and an average daily rate of $48.53. Most comparisons to the same year-earlier period were not provided and were not otherwise immediately available.
Overall, ACEP says casino revenues fell 16.1% to $55.9 million while hotel revenue fell 25.7% to $16.2 million. In the casinos, revenue from slot play decreased 16.0% due to a 20.4% decrease in the amount of money being put into the slots. Revenue from table games decreased 18.3% due to a 27.1% drop in the amount being gambled. Bingo revenue fell 37.7%. The decrease in hotel revenues is the result of a decrease in room occupancy to 72.1% from 84.4% in the same year-earlier period and a 16.6% drop in the average daily room rate.
"The decrease in both occupancy and average daily room rate across our properties is primarily a result of sharp decreases in rates across our markets and our increased reliance on wholesale room sales, which are primarily generated on the internet," the company states in its SEC filing. Indeed, the company says its hotel expenses increased 2.3% to $9.0 million due to a 279.8% increase in commissions paid for wholesale room sales and increased repair & maintenance expenses.
Food and beverage revenues decreased 16.3% to $19.5 million. Beverage revenues were aided by the addition of cocktail service at the Stratosphere pool, and the opening of the 'Back Alley Bar' and 'Liquid Courage Bar' venues.
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