ATLANTIC CITY - Hopes of Revel turning things around for this struggling resort are fading with each passing month.
And Revel's disappointing casino revenue released on Friday - it generated $17.5 million in July - has made the threat of an early bankruptcy more imminent, according to industry observers and gaming analysts.
July revenue figures from the New Jersey Division of Gaming Enforcement showed that the $2.4 billion casino placed eighth among the dozen casinos here - just slightly better than the tiny Atlantic Club, Golden Nugget, Resorts and Trump Plaza.
The $17.5 million that Revel generated from its slot machines and table games was just a tad better than the $14.9 million it made in June - but still significantly below the $25 million to $30 million that Wall Street projected it needs to stay solvent and pay its bonds.
"We had expected them to do significantly better in July given it was one of the strongest seasonal months," said gaming analysts John Kempf of RBC Capital Markets L.L.C. on Friday.
To put it in context, market leading Borgata generated $54 million last month - triple Revel's figure. Borgata opened at a cost of $1.1 billion in the city's Marina District in July 2003.
"With the number less than $20 million, I would say unless Revel can dramatically increase their gaming revenue, it will be hard for them to generate free cash flow and therefore, make their debt service payments," said Andrew Zarnett of Deutsche Bank AG. "More revenue generation is needed, and time is running out as summer is nearly over."
The overall Atlantic City gaming market, which had hitched its fortunes to Revel, continues to be in trouble. Total casino revenue in July was $308.2 million, down 9.5 percent from a year ago.
Slot machine revenue fell 8.9 percent, and revenue from table games was down 11 percent - perhaps underscoring the full impact Pennsylvania's casinos are having on the resort.
July marked the one-year anniversary of the arrival of table games, such as poker and blackjack, to Pennsylvania casinos. Table games have traditionally represented about a third of Atlantic City's total revenue.
"They are just not making any money right now," said one analyst, who asked not to be named, of Revel's dismal start. "In one of the biggest months, they are not even close."
Revel also placed eighth among the 12 casinos in June, May and April. The casino made $13.9 million in May, and $13.5 million in April, in total casino revenue.
Revel was viewed as a critical piece in a strategy to sell the seaside resort as a non-gaming destination with its celebrity chef restaurants, retail galleria, giant spa and 10 pools. Unfortunately, gaming revenue is what pays the bonds, and the casino has some hefty interest payments coming up.
Of its $2.4 billion price tag, Gov. Christie provided $261 million in state tax credits in 2011 toward its development, and designated Revel as "crucial for Atlantic City's future." He said Atlantic City has to become a true overnight destination resort and not just for gambling. The Republican governor is behind a five-year, state-run overhaul of Atlantic City where a new tourism district was created, and a half-decade long, $30 million-a-year marketing campaign to tout the resort's non-gambling offerings is under way.