Vegas casinos back to cashing in: Caesars CEO
It's been a tough few years for casino operators in Las Vegas. However, Caesars Entertainment (CZR) CEO Gary Loveman believes the industry is on the mend.
"Things in Vegas are getting better," he said in an interview last week with CNBC's " Closing Bell ."
The gambling mecca "is more buoyant, in large part because supply has been stable now for some time, demand patterns are improving, the convention and meeting business is robust," Loveman said. "We've enjoyed a great start to March Madness, which is always a good time for us."
Vegas was hit hard by the recession, as gaming revenue fell 6.67 percent on the Las Vegas strip and 16.17 percent on the Boulder strip between 2007 and 2014, according to the Center for Gaming Research at the University of Nevada Las Vegas. Downtown Vegas was hurt hardest, with gaming revenue dropping 19.20 percent during that time, according to the center's data.
Caesars Entertainment was not immune. Earlier this year, the company's operating unit filed for Chapter 11 bankruptcy to implement its plan to cut $10 billion in debt.
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In February, the company also announced Loveman would be stepping down as CEO, to be succeeded by Mark Frissora. The transition will begin after the first quarter, with Frissora taking the helm on July 1. Loveman will continue to serve as chairman of Caesars Entertainment and Caesars Entertainment Operating Group.
Meanwhile, Las Vegas has turned to non-gaming experiences, like nightclubs and restaurants, to help boost business. Reality star Rick Harrison of "Pawn Stars" told CNBC recently the city had to do something to keep on going.
"It's the great thing about the city-it keeps on changing. The nightclubs are just insane," said Harris, owner of the Gold and Silver Pawn Shop in Las Vegas.
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Conventions are also big business for Sin City. According to the Las Vegas Convention and Visitors Authority, 12 new and rotating conventions and trade shows are coming to town this year and are expected to boost the local economy to the tune of $315 million.
It's a strategy that appears to be paying off. Last year, the city had a record 41.1 million visitors in 2014, about 1.4 more than the previous high of 39.7 in 2012, the organization said.
On the other side of the country, however, Atlantic City has also had its share of problems. The East Coast's gaming center teeters on the brink of insolvency in the wake of massive job cuts and casinos in neighboring states that have slowly siphoned away revenues.
Four of the resort's 12 casinos shut their doors last year, and the city is facing a current projected budget deficit of $101 million. Without big changes to revive the economy, it is looking at a cumulative deficit of $393 million over five years. Earlier this week, however, Atlantic City's emergency manager said bankruptcy was not being contemplated .
Loveman cited the effects of legalization of gambling in Pennsylvania, New York, Delaware and Maryland, which took share from the city's casinos.
"You had what was a regional monopoly in Atlantic County, N.J. exposed to a tremendous influx of supply and locations that were proximate to where people had lived who had heretofore gone to Atlantic City," he explained.
"The institutional circumstances there were not flexible enough to adjust to it very quickly, so it's been very painful to Atlantic City but the growth has been fairly substantial for the region broadly."
-Reuters contributed to this report.
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