Caesars Entertainment Corp., the casino operator that’s battling creditors in court over debt restructuring, said its second-quarter loss more than doubled, in part because of higher interest expenses.
The net loss widened to $466.4 million, or $3.24 a share, from $212.2 million, or $1.69, a year earlier, the company said today in a statement. Revenue grew 3 percent to $2.19 billion.
Caesars, with properties in Las Vegas that include Caesars Palace and Planet Hollywood, has had only one profitable year since 2008 as it has struggled to service $23 billion of long-term debt incurred in a leverage buyout, amid a drop in gambling in the U.S. Industrywide, revenue in Nevada has risen for two straight months, including a 14 percent gain in June from a year earlier.
Last quarter, Caesars’ interest costs rose by $113.7 million. Results in the period were also hurt by a “difficult operating environment” in Atlantic City and other regional markets, where revenue fell 8.3 percent, the company said.
Industry gambling revenue in Atlantic City fell 5.7 percent in June after a 8.2 percent drop in May. The gaming hub has been hurt by gambling competition in the U.S. Northeast and is experiencing the closure of a number of casinos, including Caesars’ Showboat.
Caesars, the largest owner of casinos in the U.S., fell 2.3 percent to $13.35 in extended trading after it announced the results. The stock has fallen 37 percent this year.
The company, based in Las Vegas, was taken private in a leveraged buyout in 2008 by Apollo Global Management LLC and TPG Capital.
Caesars sued more than 30 bondholders, including funds overseen by Appaloosa Management LP, Oaktree Capital Group Holdings LP and Elliott Management Corp., in New York, accusing of trying to impede a restructuring of its debt with “disruptive appearances before gaming regulators” and “a baseless default notice.”
Wilmington Savings Fund Society, a trustee for holders of some of Caesars’ 10 percent notes payable in 2018, simultaneously sued the company in Delaware Chancery Court in Wilmington, accusing it of fraudulently transferring assets as part of the restructuring and wasting assets.
The New York case is Caesars Entertainment Operating Company Inc. v. Appaloosa Investment Limited Partnership, 652392/2014, New York State Supreme Court (Manhattan). The Delaware suit is Wilmington Savings Fund Society FSB v. Caesars Entertainment Corp., CA NO. 10004, Delaware Chancery Court (Wilmington).
(Caesars held a conference call at 4:30 p.m. New York time. Go to the Investor Relations section of www.caesars.com.)