Tropicana Entertainment reports $1.5 million profit in third quarter

Las Vegas-based Tropicana Entertainment Inc. today said it earned $1.5 million in the third quarter, despite the deterioration of the Lake Tahoe and Laughlin markets in Nevada where it has three hotel-casinos.

The company, which emerged this year from the Tropicana Entertainment Holdings LLC bankruptcy, posted net quarterly revenue of $177.9 million. It's controlled by investor Carl Icahn.

There are no comparable numbers for the 2009 third quarter at the corporate level. The Tropicana Las Vegas hotel-casino was also spun out of the bankruptcy to unaffiliated investors and is not part of Tropicana Entertainment.

Tropicana Entertainment includes the Atlantic City Tropicana; Casino Aztar in Evansville, Ind.; Belle of Baton Rouge in Louisiana; Bayou Caddy's Jubilee in Greenville, Miss.; Lighthouse Point in Greenville; and Horizon Vicksburg in Vicksburg, Miss.

Its properties in Laughlin are the Tropicana and the River Palms; while its Lake Tahoe property is the MontBleu Casino Resort & Spa.

Net revenue for the Nevada properties of $34.4 million was down 10.2 percent from 2009's third quarter as slot volumes fell 16.8 percent.

"Net revenues ... continue to be negatively impacted by the deterioration of casino revenue in the Laughlin and South Lake Tahoe markets resulting from the continuing economic slowdown and reduced consumer discretionary spending. Based on the most recent market data available, the Laughlin market as a whole witnessed a third quarter of 2010 decline in casino revenue of 2.9 percent compared to the third quarter of 2009," Tropicana Entertainment said in today's filing.

Occupancy at the Nevada hotels of 71.3 percent improved by 2.6 percentage points as the average daily rate of $40 fell 8.3 percent.

Tropicana Entertainment said its Atlantic City Tropicana generated net revenue of $86.1 million and a profit of $8.2 million for the three months ended Sept. 30. Since acquiring the Atlantic City property for $282 million on March 8, it has produced net revenue of $183.4 million and $12.5 million in net income for Tropicana Entertainment, the company said today.

Casino Aztar in Indiana posted net revenue of $31.8 million, up from $30.6 million.

Net revenue for the hotels and casinos in the South was $25.5 million, down 10.5 percent from the year-ago quarter with the "continuing economic slowdown and reduced consumer discretionary spending" responsible for part of the decline.

Companywide, Tropicana Entertainment today said its results continued to be affected by the economic slowdown.

"Weak economic conditions continue to adversely impact the gaming industry and the company. We believe our guests have reduced their discretionary spending as a result of uncertainty and instability relating to employment and the credit, investment and housing markets," Tropicana Entertainment said in today's report.

Icahn also owns the unfinished and mothballed Fontainebleau gaming resort on 25 acres on the Las Vegas Strip, which he acquired in February for $148 million.

One of Icahn's companies, New York-based Icahn Enterprises LP, reiterated in a regulatory filing last week: "Our real estate segment intends to secure the `Former Fontainebleau Property' until market conditions improve."