Each industry has to go through different phases where they see a major rise in their business and profits and at the other time also witness the slump and decline in profits. However one needs to be better prepared for it and the same is with casino industry these days. There are regions where casino industry is doing exceptionally great and while there are regions and companies who are not able to cope up with the slump and are posting huge loses. Recently casino operator Caesars Entertainment Corporation (CEC) lost over $2b in the second quarter of 2016 because of the restructuring of its bankrupt main unit. The Las-Vegas based company which operates Harrah’s and Caesars casinos reported a net loss of $1.01 billion which comes to $7 per share. This is still an improvement as compared to its $1.76 billion loss equivalent to $13 per share which it suffered a year ago.
Caesars Entertainment shared tumbled after hours trading on Monday after the news came that the casino and entertainment provider missed both the top and bottom line estimates in its fourth quarter. Its revenue increased 6% to $2.13 billion but it came in below consensus estimates of $2.22 billion. Caesars largest subsidiary, Caesars Entertainment Operating Co.(CEOC) filed for Chapter 11 bankruptcy protection in January and is working through the most restructuring plans. This unit currently owns 30 properties which includes the most of the towers of Caesars Palace on the Las Vegas Strip.
In order to help finance the bankruptcy Caesars Entertainment said in December that it would acquire Caesars Acquisition Company, one of its publicly traded subsidiaries in an all stock deal. CEO Gary Loveman is stepping down from the top job at the end of the current quarter.
In a further move the company on Monday agreed to sell its casino-style online games unit Playtika for $4.4 billion to Chinese investors headed by Shanghai Giant Network Technology as reported by Bloomberg.
CEO Gary Loveman said:
“As we begin 2015, we are highly focused on enhancing performance at CEOC through a series of cost initiatives and the implementation of the previously announced financial restructuring plan.”
He further added,
“With more than 80% of first lien note holders supporting the plan, we are committed to working with additional creditor groups to build greater consensus and complete the restructuring process as quickly as possible.”
