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LAS VEGAS-Harrah’s Entertainment, the largest casino operator in the world said Tuesday it lost $1.6 billion during the third quarter of 2009, mostly due to the acknowledgement of a $1.33-billion drop in the fair value of its assets. The locally based and now privately held casino operator lost less than 10% of that amount in the same year-earlier period.

Harrah’s operates more than 50 casinos around the world and seven on the Las Vegas Strip. In addition to a huge debt load–$19 billion as of June–related to its being taken private, the operator is suffering through the general economic recession, which has reduced travel and related spending, and, specifically in Las Vegas, an oversupply of hotel rooms and casino floor area.

Compared to the same year-earlier period, Harrah’s in the third quarter generated lower revenues in every market in which it operates. Combined revenue was $2.28 billion, down 13.7% from $2.65 billion. CEO Gary Loveman offered up only “lower spending by consumers” as an explanation for the lower revenues.

Excluding the $1.33 billion of lost value in its assets, Harrah’s income from operations would have been $278.4 million, a 20.3% decline from $349.6 million in the same year-earlier period.

In Las Vegas specifically, where it operates the Las Vegas Strip casino resorts Caesars Palace, Flamingo, Paris, Bally’s, Rio, Imperial Palace, Bill’s Gamblin’ Hall and one more under its own name, Harrah’s net revenue fell 17.5% to $657.2 million from $796.8 million in the same year-earlier period. Combined with $875.8 million in lost value, its Las Vegas operations lost nearly $778 million after producing a property-level EBITDA of $173 million, down 24.8% from $230 million in the same year-earlier period.

Harrah’s did not provide specifics on average occupancy, average daily room rate or revenue per available room. Average occupancy was “more than 90%” and the average daily room rate was “lower,” it said. On the Internet, the rates it is offering range from $29 per night at Imperial Palace to $45 per night at Flamingo and $90 per night at Caesars Palace.

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