New York (Reuters) – Trump Entertainment Resorts Inc. reported a wider-than-expected first-quarter loss on Wednesday, but the casino operator said it was revamping operations and had cut back spending on promotions, sending its shares up nearly 3 percent.
Trump, which was started by Chairman Donald Trump, is working its way back to profitability after emerging from bankruptcy a year ago. The company owns three casinos in Atlantic City, New Jersey, and has applied for a license to build a casino in Pennsylvania.
For the first quarter, Trump posted a net loss of USD 9.7 million, or 32 cents per share. A year earlier, when it was in bankruptcy, it reported a net loss of USD 45.4 million, or USD 1.52 per share.
Analysts, on average, were expecting a loss of 25 cents a share, according to Reuters Estimates.
The company filed for bankruptcy in November 2004 and emerged in May last year. Its results in the first quarter of 2005 included reorganization costs.
Dennis Forst, an analyst at KeyBanc Capital Markets, said the results were in line with his own expectations. He said promotional allowances were down from the 2005 fourth quarter, cash flow was higher compared with a year earlier, and overhead was less than he had expected.
„I think that the management is doing everything correctly,“ he said.
The company has been revamping operations under its new chief executive, James Perry, with steps including upgrading properties and focusing on improved customer service.
Net revenue in the first quarter was USD 237.6 million, up from USD 234.2 million a year earlier, when the company was known as Trump Hotels and Casino Resorts.
Analysts, on average, were expecting revenue of USD 234.6 million, according to Reuters Estimates.
Trump said it saved USD 12.7 million by cutting back on what it spends on promotions. Atlantic City casinos usually offer discounted bus tickets and gambling coupons to attract customers.
The company said it had started work on a USD 110 million capital plan, which includes upgrades at its properties — Trump Taj Mahal, Trump Plaza and Trump Marina — in Atlantic City.
Trump shares were up 70 cents, or 3.65 percent, to USD 19.90 in morning trading on Nasdaq.