A WAVE of WORRIES Casinos: Waiting for storm's end, and OK to reopen

Posted: August 30, 2005

It takes a force of nature to shut down casinos, which stay open year-round, even on Christmas. That's just what Hurricane Katrina did as it hit the Gulf Coast, home to riverboat and other casinos.

In all, about a dozen casinos in the region shut down.

The Mississippi Gaming Commission ordered all casinos in the state closed as of 6 p.m. Sunday. Las Vegas-based Ameristar Casinos Inc., which owns mostly riverboat casinos, shut down Ameristar Casino Vicksburg, its dockside casino in Vicksburg, Miss. The casino is in the extreme western border of the state, right on Interstate 20 and about a three-hour drive from New Orleans.

"Right now, we're basically still waiting out the storm, and we're waiting to hear from the Mississippi Gaming Commission as to when it's safe to reopen," Ameristar spokeswoman Kathy Callahan said yesterday. "There's no power or electricity in the area."

The last time Isle of Capri Casinos Inc. shut down its dockside casinos in Mississippi for more than a few hours was because of Hurricane Lili in 2002, a company spokeswoman said.

Anthony Sanfilippo, central division president for Harrah's Entertainment Inc., said Harrah's New Orleans, Harrah's Grand Casino Biloxi in Biloxi, Miss., and Harrah's Grand Casino Gulfport in Gulfport, Miss., remain closed.

"Our first concern is the safety and welfare of our team members, their families, and our guests who are unable to leave the area," Sanfilippo said in a statement. "Our properties in Bossier, Lake Charles and Tunica have joined forces to provide shelter as needed."

One analyst says the closures could cost the gambling industry at least $3.55 million in revenue each day.

Stock prices of many of the gambling operators with properties in the path of the storm fell yesterday.

Shares of Boyd Gaming Inc., were $47.59, down 20 cents. Shares of Isle of Capri, which is based in Biloxi, Miss., and which operates two casinos in Louisiana that generated 23 percent of its revenue last quarter, fell 66 cents to $23.52.

Others less dependent on their casinos in the region rebounded. Shares of Ameristar rose 20 cents to $24.19. Harrah's rose 25 cents to $72.75. Penn National Gaming Inc. closed at $34.91, up 26 cents.

On Sunday, Penn National shut down three of its casinos: Boomtown casino in Biloxi and Casino Magic-Bay St. Louis in Bay St. Louis, both in Mississippi, and Casino Rouge in Baton Rouge, La. The three casinos were forced to close last year when Hurricane Ivan swept through the region, and they were shuttered for four days.

Deutsche Bank gambling analyst Marc Falcone wrote a note to investors in which he said he anticipates some level of earnings impact but said it was difficult to determine how much of an effect it would be.

Falcone estimated that Harrah's Entertainment Inc. will lose $1.8 million to $2.5 million in revenue for each day that it keeps its Gulf casinos closed. MGM Mirage could lose $700,000 to $1.1 million; Pinnacle Entertainment Inc., $400,000 to $700,000; Penn National, $300,000 to $600,000; Boyd Gaming, $200,000 to $450,000; and Isle of Capri, $150,000 to $350,000.

Contact staff writer Suzette Parmley at 215-854-2594 or sparmley@phillynews.com.

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