Golden Nugget parent loses $14.1 million in second quarter

Golden Nugget owner Landry's Restaurants suffered a $14.1 million net loss in the second quarter despite an uptick from the company's two casinos.

Houston-based Landry's said Monday that gaming revenues from the Golden Nugget Las Vegas and the Golden Nugget Laughlin were $57.7 million in the quarter ended June 30, compared with $56.5 million in 2009's second quarter.

Company officials said the Golden Nugget Las Vegas benefited from a 500-room hotel tower addition that opened in November.

"The gaming industry continues to struggle with excess capacity eroding pricing power and reduced consumer spending," Golden Nugget Chief Financial Officer Rick Liem said. "Fortunately, the additional rooms at the new Rush Tower have allowed us to mitigate the rate impact on overall revenue."

Landry's quarterly loss per share was 87 cents. A year ago, the company earned $8.2 million or 42 cents per share.

Overall company revenues in the quarter were $294.6 million, up 4.5 percent from $282 million a year earlier.

Landry's operates such restaurant brands as Landry's Seafood House, Chart House, Rainforest Cafe and Saltgrass Steak House, as well as amusement facilities.

Landry's officials said the oil spill in the Gulf of Mexico has affected three locations where the company operates, however, revenues improved year over year despite the disruption.

Union Gaming Group principal Bill Lerner said the Golden Nugget Las Vegas is the market leader downtown, where gaming revenues have fallen 5 percent through May.

"The recent capital expenditure spend at the Golden Nugget in downtown Las Vegas was the primary driver of gaming growth and market share during the quarter," Lerner said in a note to clients.

Barbara Cappaert, a bond analyst with KDP Asset Management, said Golden Nugget's cash flow of 11 million during the quarter, down from $12 million, was in line with expectations as business in both downtown and Laughlin has slumped much of the past year.

"This represented a 12 percent decline year over year which was consistent with what other downtown operators reported," Cappaert told investors. "Room rates continue to be highly competitive in Las Vegas."

Shares of Landry's closed at $24.41 on the New York Stock Exchange on Monday, up 14 cents, or 0.58 percent.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.