Mandalay Resort’s Q2 Earnings Fall

LOS ANGELES— Casino operator Mandalay Resort Group on Thursday reported that second-quarter earnings fell nearly 20% in its second quarter, but said early signs indicate that visitor volume and hotel revenues will grow year-over-year in its third quarter. Las Vegas-based Mandalay, whose resorts include Circus Circus and Luxor, reported second-quarter net income of $30.5 million or $0.40 per diluted share, vs. $38.1 million or $0.48 per share a year ago. Revenues for the quarter totaled $644 million, vs. $639 million a year ago. Excluding opening costs, the company reported second-quarter earnings of $0.41 per share, vs. $0.50 a year ago. The consensus second-quarter earnings estimate among the 17 analysts polled by Thomson Financial/First Call was $0.41 per share, with estimates ranging from $0.40 to $0.42. Earlier this month, Mandalay warned that weak performance at its lower-end Nevada resorts and higher energy costs would cause it to report lower-than-expected earnings in the second quarter. Prior to the warning, the consensus estimate for the company had been $0.51 per share. Mandalay Chief Financial Officer Glenn Schaeffer said the company — which has not added an energy surcharge at its properties — paid about $5 million more in energy costs in the second quarter in Las Vegas than during the same quarter last year. Without those added costs, he said, the companys earnings per share would have been about flat year-over-year. Despite the weak trends, however, Schaeffer said that Mandalay expects hotel room revenues and visitor volumes in Las Vegas to increase year-over-year in the third quarter, based on preliminary indicators.