The parent company of the Stratosphere trimmed its loss for the second straight quarter due to a successful debt retirement, and occupancy at the property continues to top 90 percent.
The company's debt load dropped 68.4 percent, enabling the company to pay less interest in the past two quarters.
American Casino & Entertainment Properties, however, continues to experience double-digit drops in revenues as it struggles with continued decreases in customer spending at all four of its properties.
The company posted a net loss of $1.8 million in the third quarter ended Sept. 30, a filing with the Securities and Exchange Commission shows. The amount is a 78 percent improvement from the $8 million net loss posted a year earlier.
The company cut its long-term debt load to $350.5 million in the third quarter from $574 million in the second quarter. The decrease is due to the completion of a restructuring of the company's previous $1.1 billion debt load, acquired when the company was purchased in February 2008.
The company's loss may widen in the fourth quarter with a $14.1 million interest payment on its new debt scheduled in December.
Third-quarter revenues for the company, which owns both Arizona Charlie's hotel-casinos, the Stratosphere and the Aquarius Casino Resort in Laughlin, fell 17 percent to $87.7 million from $105.7 million.
Revenues in the year's first nine months fell 16.6 percent to $275.5 million from $330.4 million. But the company trimmed its nine-month loss to $4.2 million from $10.4 million.
Casino revenues, which account for nearly 54 percent of American Casino's revenues, fell 20.5 percent in the quarter and 16.9 percent for the year.
Cash flow for the quarter, defined as earnings before interest, taxes, depreciation and amortization, decreased 23.5 percent to $14.3 million, and 24.7 percent to $55.5 million for the year's first nine months.
In the third quarter, occupancy at the 2,444-room Stratosphere hotel slipped 3.9 percent to 93.2 percent. Both Arizona Charlie's, which total 561 rooms, and the Aquarius, Laughlin's largest hotel with 1,907 rooms, reported mid-40 percent occupancy levels for the quarter.
American Casino Chief Financial Officer Ned Martin said the company projects $22.3 million in capital expenditures next year after spending $16 million this year. The company renovated pools and improved some infrastructure at the Stratosphere and Aquarius.
Whitehall Street Real Estate Funds, a real estate investment fund affiliated with Goldman Sachs, owns American Casino & Entertainment Properties.
Contact reporter Arnold M. Knightly at aknightly@reviewjournal.com or 702-477-3893.
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