A good-news, bad-news scenario is emerging at the Las Vegas Hard Rock hotel-casino under its new ownership.
In the 1,500-room property’s financial report issued Monday for the first nine months of the year, the bad news is that revenue fell from the same period of 2010 as the Hard Rock continued to be punished by the recession and tough competition for customers.
The good news is that while it’s still losing money, it’s losing less money than it did during the first nine months of 2010.
Net revenue (meaning revenue after adjusting for comps handed out to gamblers) was $155.2 million in the first nine months of 2011 — down 13.5 percent from $179.3 million in the year-ago period.
“Management believes the overall decrease in net revenue is a result of continued pressures from the soft local economy and an increase in competition on the Strip,” the Hard Rock said in its report.
A spokesman for Brookfield Asset Management Inc. of New York, a giant real estate company that acquired the Hard Rock as part of a distressed-debt restructuring on March 1, said Brookfield wasn’t commenting on the Hard Rock’s financial report.
The increased competition on the Strip referred to in the report is likely a reference to the Cosmopolitan of Las Vegas, which opened in late 2010 and like the Hard Rock markets to a young, hip audience.
The Hard Rock said that despite a $16.4 million or 33.9 percent decrease in casino revenue and a $12.3 million or 15.5 percent decline in food and beverage revenue, its hotel turned in a stronger performance compared to the first nine months of 2010.
The average daily room rate increased $3.49 to $136.7, generating a $2.5 million increase in lodging revenue on a year-over-year basis. The Hard Rock attributed the improvement to improved convention business early in the year as well as marketing adjustments.
The good news overall for the property is that the loss in the year-ago period of $80 million was narrowed to $28.5 million for the first nine months of this year, with the Hard Rock attributing the improvement to lower expenses.