Harrah's Entertainment profit up, aided by insurance
NEW YORK (Reuters) - Harrah's Entertainment Inc. HET.N, the world's biggest casino operator, said on Tuesday second-quarter profit rose largely on higher revenue at its casinos in Las Vegas and on the U.S. Gulf Coast.
The company, which agreed in December to be acquired by two private equity firms for about $17 billion, was also helped by proceeds from selling corporate jets and an insurance claim for damage to casinos it owned on the Gulf Coast that were hit by Hurricane Katrina.
The Las Vegas-based company posted net income of $238 million, or $1.25 per share, compared with $129 million, or 69 cents per share, a year earlier.
Excluding the insurance claim and other one-time items, adjusted earnings from continuing operations were 96 cents per share, just below Wall Street's average forecast of 98 cents, according to Reuters Estimates.
Revenue rose 14 percent to $2.7 billion, ahead of analysts' average forecast of $2.6 billion, helped by higher sales in each of its main regions and overseas.
Profits from Harrah's Las Vegas casinos, which include Caesars Palace, Flamingo and Paris Las Vegas, rose 14 percent to $239 million.
Profits in the Atlantic City region fell 38 percent to $77 million, hurt by competition from new slot machine operations in New York and Pennsylvania and higher marketing costs.
On the Gulf Coast, where Harrah's plans to invest $700 million to develop the Margaritaville Casino & Resort, profit rose 49 percent to $93.6 million.
Harrah's, which owns or manages nearly 40 casinos under brand names such as Harrah's, Caesars and Horseshoe, agreed in December to be acquired for $17.1 billion by private equity firms Apollo Management and Texas Pacific Group TPG.UL.
The deal, approved by Harrah's shareholders in April, is expected to close late this year or early next, as it gets approval from a host of gaming regulators.
