Unless you're Catholic or Cajun, you may not have realized that today is Mardi Gras. And tomorrow? Tomorrow is Ash Wednesday -- the beginning of the Lenten period of abstinence -- but it will also be six months to the day since Hurricane Katrina struck the Gulf Coast.
Katrina has changed the way Carnival is being celebrated along the Gulf Coast this year. Tourist dollars are being distributed somewhat differently. In the Big Easy, it will be a greatly scaled-down affair put on mostly for the benefit of children and local morale -- to provide a semblance of normality, as odd as that all may sound to anyone who has ever been one of the million pilgrims wading through the knee-deep sea of plastic cups, beer cans, beads, and doubloons that is the madness of Mardi Gras in New Orleans.
Other cities along the Gulf Coast also have a tradition of celebrating Mardi Gras, some for hundreds of years. Mobile, Ala., has the second-largest celebration in the U.S., and it's vying with other coastal cities for the tourists and dollars that won't be flowing into New Orleans this year. According to a CNN.com article, cities from Galveston, Texas, to Fort Walton Beach, Fla., have been advertising to attract "family-oriented" revelers who don't feel ready to venture into New Orleans yet.
Meanwhile, Biloxi, Miss., which is normally a major regional tourist destination because of its casinos, is still trying to rebuild from the brunt of the storm and is scheduled to have only one parade today. Acoording to the Gulf Coast Carnival Association, the traditional nighttime parade won't be held this year because the city can't accommodate an influx of overnight visitors. Many hotels and casinos were damaged or destroyed in the storm, and those that weren't now house reconstruction workers and displaced locals.
Still, the regular 85,000 are expected to turn out for Biloxi's single parade, and that's certainly welcome news for Mississippi's Gulf Coast casinos, whose operations were shut down entirely for three months. Fellow Fool Nathan Slaughter wrote back in August about how few businesses in the storm's path were going to feel the financial pinch more than the local casino industry. So now, six months later, let's check in on how those casinos are faring.
Mississippi
Of the 12 casinos operating along the Mississippi Gulf Coast before Katrina, only three have reopened. Needless to say, the torrential rain, floods, and wind wreaked havoc on these floating casinos. Fool Jeff Hwang detailed the openings back in December -- the first month of gaming activity along the Coast since Katrina. The Imperial Palace opened with more slots, more tables, renovated hotel rooms, and a new poker room. The Palace Casino opened with curtailed operations just before the New Year. Isle of Capri (NASDAQ:ISLE) reopened, but moved its operations to its new onshore hotel tower for the time being. Isle's 32,500-square-foot gaming barge was destroyed, so the company is taking advantage of a new law permitting land-based gambling in Mississippi.
Damage to Harrah's (NYSE:HET) Grand, the MGM Mirage (NYSE:MGM), and others was too extensive even for temporary, pared-down operations. Meanwhile, Beau Rivage, Penn National Gaming's (NASDAQ:PENN) Boomtown Casino, and Treasure Bay plan to reopen later this year. The lack of competition has been a boon for the three casinos that were able to open before the others catch up. According to reports, tourists and locals have packed into the newly opened casinos, and hotel rooms have been hard to come by.
According to the Mississippi Gaming Commission, Gulf Coast casinos generated $64 million in revenue in January 2006 -- an impressive result with only three casinos in operation. While those numbers are still down from $119 million in January 2005, when nine casinos were operating, it's a good start on the road to recovery.
New Orleans
As for casinos in the Big Easy, revenues are rather encouraging -- at least if you're a riverboat casino. Although Harrah's -- the city's only land-based casino -- sustained fairly minor damage, it remained closed until Feb. 17, but the city's riverboat casinos actually showed an increase of 70% in revenue in January '05 over last year, despite one of the three (Bally's) remaining closed. Pinnacle's (NYSE:PNK) Boomtown New Orleans brought in $24.6 million in January, and Boyd Gaming's (NYSE:BYD) Treasure Chest took in $16.9 million in January. December revenues were comparable for both casinos. That's a total intake of $41.5 million in January '06, compared with January '05 total revenue of $24.4 million for riverboat casinos. Now that Harrah's has reopened, though, it will probably resume its place in the casino pecking order as the biggest game in town to a populace in desperate need of distraction from FEMA and insurance nightmares.
The show must go on
Even with Mardi Gras tourist demographics shifting somewhat this year toward areas that don't need the revenue as badly, all the casinos that have managed to reopen should still profit from the party. And considering that the gaming industry provides lifeblood for both Biloxi and New Orleans, any transfusion, however skimpy, could provide the kickstart the local economies need to get back up and running.
And the possibility that Carnival and casinos are, just maybe, doing more to rebuild their city than FEMA is -- what New Orleanian would argue with that?
Fool editor Carrie Crockett once won big-time at the roulette wheel on a riverboat in New Orleans. She does not own shares of any company mentioned in this article. The Fool has an ironclad disclosure policy .
