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MTR: Gaming Competition 'Cannibalizes' Markets
CHESTER, W.Va. -- MTR Gaming Group Inc. reports second-quarter net income of $2.4 million, or 8 cents per diluted share. Total net revenues were $132.3 million, an increase of 11.1%, compared to $119.1 million in the same period a year ago.
Continued strength of the company's Scioto Downs in Columbus, Ohio, led to the double-digit in revenues revenue, said MTR's acting president, Joseph L. Billhimer. But the expansion of gaming elsewhere "continues to cannibalize existing mature markets," he said.
“We were proud to celebrate the first anniversary of Scioto Downs’ video lottery terminal facility during the quarter, which has maintained a strong market position in the Columbus slots market. Customer satisfaction levels continue to improve, a testament to the great job our team members are doing at the facility," Billhimer said in a prepared statement. "At the same time, the expansion of gaming in Ohio and other regional markets continues to cannibalize existing mature markets including western Pennsylvania and West Virginia in which our Presque Isle Downs and Mountaineer gaming facilities operate, respectively. We have been able to offset some of this impact through continued focus on operating efficiencies as well as targeted capital spending. As of June 30, we have spent approximately $10 million of our planned $20 million capital improvements for 2013 that are designed to enhance the overall gaming experience for our patrons and improve our competitive position.”
Net revenues at Mountaineer Casino, Racetrack & Resort here fell 10.6% to $52.4 million in the second quarter compared to $58.7 million a year ago. Revenues from slots and table games fell $4.6 million and $1.4 million, respectively, compared to the same quarter of 2012. The decrease in gambling revenues was primarily attributable to additional competition from Ohio, Billhimer said.
Additional gambling competition from Ohio also led to a drop in net revenues at Presque Isle Downs & Casino in Erie, Pa. They fell 11.4% to $42.3 million during the second quarter compared to $47.8 million the second quarter of 2012. Revenues from slots and table games decreased by $4.1 million and $1.2 million, respectively, compared to the same quarter of 2012.
For the first half, MTR’s total net revenues rose 12.6% to $255.7 million from $227.1 million in the first six months of 2012. 2013 year-to-date net income was $1.6 million, or 6 cents per diluted share. In the same period last year, MTR reported a net loss of $5.5 million, or 20 cents per diluted share, which included $2.5 million of project-opening costs and a $0.3 million loss from discontinued operations.
Published by The Business Journal, Youngstown, Ohio.
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