New St. Louis casino shows slight loss
ST. LOUIS—St. Louis' newest casino took a slight loss in its first full quarter of operation, a loss the company blamed on startup costs.
Las Vegas-based Pinnacle Entertainment opened the $507 million Lumiere Place on the St. Louis riverfront on Dec. 19. For the period of January through March, Pinnacle said the casino lost $760,000 on revenue of $47.2 million.
The results, announced Wednesday, include the casino, its hotel complex and the Admiral Riverboat Casino, a much smaller downtown casino purchased by Pinnacle in 2006.
Pinnacle said the company incurred high expenses for customer services, staffing and marketing associated with the startup of Lumiere Place. The company said Lumiere Place overstaffed initially while workers were trained, and marketed to a broad audience.
Pinnacle said that over time, staffing levels will be reduced primarily through attrition "as employees become more skilled at providing first-class service." Marketing efforts will become more targeted as the company develops a database and the need for name recognition declines.
Despite the loss, Pinnacle Chairman and Chief Executive Officer Daniel Lee and president Wade Hundley said early trends for the new casino were positive.
"We've been pretty pleased with the way things have gone," Hundley said Thursday. "Hopefully, we'll turn a profit in the next couple of months. Right now, we're more focused on introducing people to the property."
Meanwhile, Hundley said a pedestrian tunnel making it easier for people to walk to the casino should open within the next two weeks. The casino sits on the east side of Interstate 70, while most of the downtown area is west of the interstate.
Also coming soon, Pinnacle said, will be remaining suites at HoteLumiere and a massive video messaging board along I-70, one the company called among the largest ever built.
Pinnacle is planning another casino in south St. Louis expected to open next year.
Overall for Pinnacle, net income for the period ended March 31 grew to $5.1 million, or 8 cents per share, compared with $2.9 million, or 5 cents per share, in the prior year. Revenue rose to $257.2 million, up 10.5 percent.
In addition to its Missouri casinos, Pinnacle operates gambling facilities in Nevada, Louisiana, Indiana, Argentina and The Bahamas. It also has submitted a proposal for a casino in Kansas City, Kan., and plans a new casino in Atlantic City, N.J.
(This version SUBS 6th graf to correct Hundley's first name to Wade sted Wayne.)
