Pinnacle profits down; L’Auberge on a roll
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Las Vegas-based Pinnacle Entertainment Inc., which is developing a south Baton Rouge casino, saw its profits plunge in the second quarter to an $18.1 million loss, but its L’Auberge du Lac property in Lake Charles continued to outperform other casinos in Louisiana with a record quarter.
For the three months ending in June, Pinnacle raked in $267 million — an increase of nearly 15 percent over the second quarter 2007. But the company went from a $10 million profit (16 cents a share) in the same quarter last year to losing $18 million this year (30 cents per share.)
Pinnacle blamed much of the loss on a charge against earnings of $22.6 million, reflecting the declining value of Ameristar Casinos Inc. stock it acquired in 2007 before the value of gambling company stocks plummeted and Pinnacle called off a planned acquisition of Ameristar. The company also absorbed significant capital costs for starting up its Lumière Place casino in St. Louis the past seven months, and it was required to make a $25 million deposit in June to the Kansas Lottery in hopes of being selected to build a casino in Kansas City, Kan.
In Lake Charles, L’Auberge du Lac recorded revenue of $90.2 million, up 10 percent from a year ago, and its hotel occupancy rate was 92 percent for the quarter, 95 percent in June. Boomtown Casino in New Orleans saw its second-quarter revenue drop from $41 million a year ago to $39 million.
Pre-development costs of $1.8 million were incurred in the quarter for a second Lake Charles casino, Sugarcane Bay, and the planned Baton Rouge casino, Rivière, slated to open in 2010. Those costs a year ago were $3.5 million when Pinnacle was waging what turned out to be a successful campaign to win Baton Rouge voter approval of the project.
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