Share prices for major casino companies drop

[clevfan]

Apr. 16, 2008
Copyright © Las Vegas Review-Journal

Share prices for major casino companies drop

By HOWARD STUTZ
REVIEW-JOURNAL

Share prices of the major casino operators tumbled Tuesday, the day after MGM Mirage said it eliminated 440 manager and supervisory level positions at both property and corporate levels.

It was unclear Tuesday if other casino operators were laying off workers as a response to the souring national and local economies.

Gaming revenues statewide and on the Strip have fallen in three of the past four months while room rates are down as much as 19 percent from a year ago.

"Trends in Las Vegas and across the U.S. have been softer this year, as both gaming and nongaming revenues have been impacted by a difficult economic environment," Deutsche Bank gaming analyst Bill Lerner said in a note to investors following the MGM Mirage cutbacks.

Most of the job layoffs took place in Las Vegas, where MGM Mirage operates 10 Strip casinos. The company, which also operates casinos in Mississippi and Michigan, employs almost 66,000 workers.

A Biloxi, Miss., television station reported Tuesday that 100 managers and salaried employees lost their jobs at MGM Mirage's two Mississippi casinos, the Beau Rivage in Biloxi and the Gold Strike Casino in Tunica.

Shares of MGM Mirage, traded on the New York Stock Exchange, closed at $49.58, down $2.24, or 4.32 percent. MGM Mirage was trading at $100.50 in October.

Other casino operators also fell in value during trading Tuesday.

Shares of Las Vegas Sands Corp. fell $4.97 to close at $69.05 on the New York Stock Exchange, off 6.71 percent. In October, Las Vegas Sands hit a 52-week high of $148.76.

Shares of Wynn Resorts Ltd., traded on the Nasdaq National Market, fell $2.63 to close at $98.06, down 2.61 percent. Wynn reached a high of $176.13 in October.

Harrah's Entertainment spokesman Gary Thompson said the company completed a staffing reduction at the corporate level six months ago based on the recommendation of an outside consultant. Some 500 positions were eliminated at the time.

Meanwhile, the company laid off about 100 workers at Bally's Las Vegas in the past three months because of the closing of the hotel's buffet. The company also eliminated some positions at its casinos in Atlantic City.

"There may have been some other job reductions since then, but nothing in numbers of any substance," Thompson said.

In February, Station Casinos said it had some layoffs and some work-hour cuts because of the economy, but nothing since then, said company spokeswoman Lori Nelson. Station Casinos is planning the opening of the $675 million Aliante Station by the end of the year, which will employ 1,500 people.

CASINO SHARE PRICES
October Latest
MGM $100.50 $49.58
LV Sands $148.76 $69.05
Wynn Resorts $176.13 $98.06