Atlantic City is still far away from its glory days, although local casinos are trying to get back to their pre-pandemic levels.
According to some revenue numbers that were released by the Division of Gaming Enforcement (DGE) of New Jersey at the beginning of the week, casino venues in Atlantic City saw mixed results in their second quarter of operation in the current fiscal year. Still, the money generated by casinos’ non-gaming operations has hinted about a return to the more diversified revenue streams that could be seen before the Covid-19 pandemic outbreak.
The latest report of the New Jersey Division of Gaming Enforcement showed that local casinos generated revenue worth almost $829 million over the three-month period between April to June 2022. The figure represented a 14% increase over the result registered in the second fiscal quarter last year, as well as a 3% increase in comparison to the figures announced in the second quarter of 2019. Furthermore, net profit saw a 1% drop on a year-on-year basis to $183.6 million, but the result was still 15% bigger than the one in 2019.
Experts noted that the modest signs of recovery proved that Atlantic City was resilient enough, although its economy was in decline due to its heavy dependency on tourism and gambling which has made it extremely vulnerable to economic turmoil triggered by the coronavirus pandemic.
Non-Gaming Offerings Account for 44% of Overall Revenue in the Second Quarter
Although Atlantic City has been used as a synonym for one of the largest gambling hubs on a global scale, it would be fair to note that the city’s economy also relies on money generated by hospitality services. And it is exactly the numbers from the non-gambling services that showed clear signs of growth, according to the DGE report.
About $374 million of the overall $829-million casino revenue was generated by food and beverage sales, entertainment and accommodation services. The figure showed an increase worth over $90 million in comparison to the one registered in the same quarter in 2021.
According to data provided by Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism (LIGHT) at Stockholm University, non-gaming sources brought 44% of the total revenue, with the result representing an increase from the 39% brought in last year. The faculty director of the Institute, Jane Bokunewicz, said in a statement that the result demonstrated a return to pre-pandemic behaviors for the patrons of brick-and-mortar casino services, not to mention it is a revenue channel that further supports the recent capital improvement investments of operators. She noted that the combination of gambling and non-gaming amenities diversified the casino product offered by operators in Atlantic City and the region.
Atlantic City saw visitors return to stay in local hotels at almost the same levels as the ones registered before the Covid-19 pandemic outbreak. Reports revealed that the casino hotel occupancy rate was 77.4% over quarter two, which is a significant increase from the 70% occupancy rate registered over the same quarter a year earlier but still, was not that much below the 81.5% levels of quarter two in 2019.
The data showed that six out of nine Atlantic City casinos saw an annual profit decline, with four of these six operators posting declines of over 14%.