Stratosphere Owner Reports Revenue Increase

The owner of the Stratosphere casino today reported a 3 percent increase in revenue in the second quarter and a 32 percent increase in operating income in its gaming division, which owns the Stratosphere as well as two Arizona Charlie's casinos in Las Vegas and the Sands hotel and casino in Atlantic City.

The gaming division of New York-based American Real Estate Partners reported revenue of $122.4 million, a 3 percent increase from the same quarter of last year. Operating income grew 32 percent to $16.9 million.

A $2 million increase in hotel revenue, driven by a 9 percent increase in average daily hotel rates, boosted gaming division revenue, the company said.

Revenue was up 11 percent at the three Las Vegas casinos and down 10 percent at the Sands in Atlantic City. Operating income was up 4 million overall, including a $6.5 million year-over-year increase in Las Vegas offset by a $2.4 million decline at the Sands.

Executives said the strongest growth occurred at the Arizona Charlie's properties, though the Stratosphere also is exceeding expectations. The Las Vegas market is growing and the company is also doing a good job controlling costs, they said.

Executives also reiterated plans to expand the Stratosphere, which could include adding more hotel rooms and convention space. Management is evaluating proposals that have not yet been reviewed by the board of directors, they said.