B.C. casino operator Great Canadian Gaming Corp. has reported a fourth-quarter loss of CAD 1.7 million, compared with a CAD 13-million profit a year ago.
The company blamed weak consumer spending, heavy snowfall and increased competition for the loss that dragged 2008 profits to CAD $ 13.5 million — a 62-per-cent drop from 2007 profits.
Great Canadian said revenues rose by two per cent last year to CAD 403.7 million but declined four per cent to CAD 96.7 million in the fourth quarter ended Dec. 31, 2008.
Chief financial officer Milton Woensdregt blamed a heavy December snowfall, the opening of a new competitive casino in Burnaby in November and declining consumer confidence for the poor fourth quarter.
„Our guests are not immune to the global economic crisis,“ he said in a conference call Monday. „Consumer spending is falling and will almost certainly continue to do so. I’ll be candid — we, like every business, are in for a challenging year.“
Woensdregt said visitation to Great Canadian casinos should remain stable this year but the amount guests spend on each visit will decline.
Great Canadian has cuts costs in recent months by laying off 430 workers from its total workforce of about 4,300 employees. The layoffs have cost the company about CAD 7.1 million in severance charges so far.
The company also announced it will scale back a CAD 51-million expansion plan at its flagship River Rock Casino in Richmond. It will still spend CAD 34 million on upgrades this year but will defer CAD 17 million in renovations until the market improves.
Great Canadian had earlier announced it would defer a CAD 28-million hotel expansion at River Rock and a CAD 25-million renovation of its View Royal Casino.