Casino CEO dismisses rumors of additional layoffs; slot-machine revenue slips in August
Reeling from the 355 layoffs announced the previous day and another month of declining slot-machine revenue, Mohegan Sun's president and chief executive officer said Wednesday the casino isn't planning further job cuts.
Mitchell Etess, asked about widespread rumors that hundreds of additional layoffs would take place in upcoming months, said this week's downsizing should prove sufficient provided economic conditions do not worsen substantially.
Mohegan Sun announced Tuesday it was eliminating 475 positions, a move that will leave 355 employees without jobs. Some 120 workers whose positions were eliminated will transition into other jobs at the casino.
"I can only say that no more layoffs are planned as of now," Etess said. "We believe the reductions we've made are sufficient to meet our plans and we will be fine moving forward. That having been said, who knows how bad the economy will be in the distant future?
"We wanted to do this as quick as possible and begin the healing as soon as possible," Etess said of the layoffs. "It would be imprudent to put people through this again. That would have no value to anybody."
From a business standpoint, it would make little sense to lay off employees in waves, Etess said. "If we thought there were additional savings to be achieved (through more layoffs), we'd be saving it as soon as possible," he added.
Mohegan Sun reported Wednesday that it "won" $67 million at its slot machines in August, 2.8 percent less than during the same month in 2009. Foxwoods Resort Casino, including MGM Grand at Foxwoods, reported an August win of $59.2 million, down 6.3 percent.
A month ago, the casinos had reported slight year-over-year increases in their July wins, the first time both had recorded gains in the same month since May 2008.
The uptick, however, turned out to be a one-month reprieve from the revenue declines that have dogged much of the casino industry for more than two years. Atlantic City's 11 casinos reported a combined 11.3 percent decline in August slots revenue.
Etess noted that while the July calendar was more favorable in 2010 than 2009 because it had one more weekend day, the opposite was true in August, which had one fewer weekend day in 2010 than 2009.
"As we said last month, it's better to look at the two months combined, where we're down half a percent - that's almost flat," he said.
At the Foxwoods casinos, traffic was noticeably down in August compared to July, particularly in the last two weeks of the month, according to Robert Victoria, Foxwoods' chief marketing officer.
"July was just a phenomenal month for Connecticut casinos," Victoria said. "I can't really explain what happened in August. We had a very aggressive calendar for the month, as did Mohegan Sun. The month started well, then turned quickly."
Foxwoods is hoping two new attractions will boost volume in the coming weeks and months. High Rollers, a luxury bowling lounge, opens Friday in the Grand Pequot Tower, and Comix, a stand-up comedy club, is set to debut Oct. 7 on the Great Cedar Concourse in space formerly occupied by The Club.
The slots figures released Wednesday show $8.1 million in free-play coupons were redeemed at Foxwoods slots last month, while $5.8 million in free-play credits were played at Mohegan Sun. Foxwoods' "handle" - the total amount wagered at its 6,741 machines - totaled $721.8 million, down 3.2 percent over August 2009. Mohegan Sun's handle of $892.3 million, wagered at 6,405 machines, was up 11.9 percent.
Mohegan Sun forwarded $17.3 million of its slots win to the state Division of Special Revenue; Foxwoods' contribution was $16 million.