CHESTER, W.Va. — Mountaineer Casino, Racetrack & Resort saw profits drop 20.5 percent from April 1 to June 30 compared to the same period in 2014, as the gambling facility that recently opened an outdoor smoking plaza to comply with new indoor air regulations faces stringent competition from both Ohio and Pennsylvania.
Eldorado Resorts Inc., which now owns Mountaineer, shows adjusted earnings slid to $7 million during the second quarter, which is down from $8.8 million over the same stretch last year. Officials also specifically blame West Virginia’s $8 per hour minimum wage – which increased from the federally required $7.25 per hour Jan. 1 – for hurting the company’s bottom line.
For several years, both Mountaineer and other West Virginia casinos have watched profits slide as new facilities opened, especially the Rivers Casino in downtown Pittsburgh and The Meadows Racetrack Casino near Washington, Pa. Mountaineer’s revenue for all of 2014 was $184.8 million, down from $196.9 million in 2013, reflecting about a 6.1 percent decline.
Now, the Hollywood Gaming Mahoning Valley Race Course that opened in Youngstown, Ohio last year also affects the Chester track, which now stands as Hancock County’s largest employer.
Gary Carano is chairman and CEO of Eldorado, which owns Mountaineer, along with Scioto Downs Racino near Columbus, Ohio, Presque Isle Downs & Casino in Erie, Pa., as well as properties in Nevada and Louisiana.
“Eldorado Resorts had a solid second quarter with each of our properties posting earnings earnings before interest, taxes, depreciation and amortization increases, with the exception of Mountaineer Park,” Carano said.
However, Carano said the firm continues investing in the Mountaineer property, highlighted recently with the new outdoor plaza that debuted to meet the new Hancock County Board of Health indoor smoking ban.
“The outdoor smoking patio with more than 200 video lottery terminals and six gaming tables at Mountaineer opened in late June and is proving to be popular with players,” he said of the new area.
Recently, the West Virginia Racing Commission approved a request from Mountaineer to cut this year’s thoroughbred racing schedule by 50 days – from 210 days to 160 days.
This also is due to collecting less revenue.
“Eldorado’s operating and facility enhancement initiatives are being complemented by the previously announced cost savings program implemented across the company, as well as our recent capital market activity which significantly reduced annualized interest expense, thereby enhancing free cash flow,” Carano added.