Atlantic City casino results in 2022 shrink

Atlantic City casinos are still smarting after the pandemic of 2020, the forced shutdowns, and the still recovering number of visitors and tourism. A mounting cost of living and inflation is not really helping offset those effects.

While there has been some pointed debate about whether Atlantic City casinos can afford to suspend smoking on casino floors, the latest figures by the New Jersey Division of Gaming Enforcement (NJDGE) published on Monday revealed that financial qualms are not entirely unjustified in the sector.

Overall, the impact of COVID-19 can still be felt. Gross operating profit in the 12 months of 2022 hit $731.2m and was down 4.6% from the numbers posted in 2021. Back then, the gross operating profit stood at $766.8m. Only four operators managed to beat their 2019 results in 2022, with the majority struggling to hold their ground.

Inflation is more or less to blame, argues Casino Association of New Jersey and Resorts Casino president Mark Giannantonio who sees the pesky financial metric as the chief culprit. Inflation has been eating into businesses’ bottom lines, with revenue simply failing to keep up. To balance, Giannantonio believes that consumer spending would need to increase, but this is doubly challenging in the conditions of a shrinking economy and feared recession.

Of course, there have been other contributing factors. Casino workers have been able to negotiate new contracts that raised the wages – something that casinos agreed to do to avert a planned strike action that would have cost them millions at the very least. Of course, labor cost is hardly to blame. Rather, the whole thing comes down to a combination of factors.

In terms of gross operating profit, Hard Rock was one of the properties that did better in 2022 than it did in 2021. Hard Rock brought in $128m in gross operating profit last year. Another property that fared better on annual basis was Ocean Resort which posted $96m in 2022 compared to $91m in 2021. On the plus side, there were not really any major disruptions.

The biggest loss of gross operating profit on a percentage basis was registered by Resorts Casino which lost 23% of its annual results. The operator posted $21m in 2022 compared to $27m. Overall, New Jersey is still a long way off from reaching its pre-pandemic results, with 2022 proving even more challenging for the sector.

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