Inside Gaming: Revenue Down in Nevada, Macau; MGM Springfield Plans Change
In this week’s installment of Inside Gaming, the latest monthly reports on gaming revenue in both Nevada and Macau show declines, MGM has changed its plans regarding the building of a new hotel-casino in Massachusetts, and the AGA is asking presidential candidates to make their positions known regarding issues of concern to the industry.
October Gaming Revenue Down Overall in Nevada
This week the Nevada Gaming Control Board released gaming revenue information for the state from the month of October, and the numbers show Nevada’s casinos having collectively had a 2.85% decline in total gaming win year-over-year.
Casinos won just under $887.6 million during October, down from the just over $913.6 million taken in during October 2014. Once again the action at the baccarat tables was down most markedly, thereby affecting overall figures. In October the baccarat win amount was down 21.77% to $79.1 million from $101.1 million a year ago.
As the Las Vegas Review Journal notes, the Strip in particular is affected by the decline in baccarat revenue, caused in part “because of the slowdown from the Chinese market” (about which see more below).
On the Strip, gaming revenue in October was also down 5.12% with baccarat revenue down 19.51%. Elsewhere in the state certain locations enjoyed a better month overall, including in Washoe County and Reno where gaming revenue was up 6.9% to nearly $50.1 million (from $46.5 million).
Meanwhile sports betting was up in the Silver State during October, thanks both to the NFL and baseball’s World Series. Statewide revenue from sports betting was up 21.78% for the month, up to $33.6 million from last year’s total of almost $27.6 million.
Incidentally, since the Nevada Gaming Commission ruled in October that daily fantasy sports was to be considered gambling and thus subject to the state’s licensing procedures, neither of the two largest DFS sites, FanDuel and DraftKings, have chosen to apply for licenses to operate in the Silver State.
For more on the October numbers and what might happen next at the baccarat tables, visit the LVRJ.
Another Monthly Decline in Macau Continues to Affect Casino Stocks
The start of a new month also means a new report from the Gaming Inspection and Coordination Bureau, Macao SAR, with the news again being bad for an 18th consecutive month.
The bureau’s report of Monthly Gross Revenue from Games of Fortune shows a decline of 32.3% year-over-year for Macau in November, down from 24.269 billion to 16.425 billion pacatas — i.e., a decline from about $3.04 billion to USD to about $2.05 billion USD. That also reflects a decline from just over 20 billion pacatas in gaming revenue in October for the Special Administrative Region, as well as the lowest monthly revenue total this year.
Forbes reported this week on how the Macau decline is indirectly reflected in the Strip’s October figures, as well as how certain stocks in particular have been affected by the year-and-a-half-long slide in east Asia.
In November both Las Vegas Sands and Wynn Resorts Ltd. saw their stock drop 10%, and in both cases the situation in Macau is thought by analysts to be a primary reason for the stocks’ decline. As we reported here two weeks ago, Wynn recently announced a new delay in the opening of its second Macau casino, the Wynn Palace, moving back the opening from March to late June 2016. Meanwhile MGM Resorts’ stock has held relatively steady over the last month.
Read more about the Macau-Vegas connections at Forbes.
MGM’s Plans for Springfield Casino Altered, Opening Delayed
Speaking of MGM, representatives of the company appeared before the Massachusetts Gaming Commission yesterday in a public meeting to discuss and defend design changes for its Springfield casino, the opening of which has now been moved forward to 2018.
NEPR reports MGM Springfield President Mike Mathis explaining to the MGC how the changes represent a reduction in square footage of about 10%. More conspicuous is the decision to alter the original plan for a 25-story hotel tower to a six-story one. Mathis is described as claiming the latter change “will fit better with the aesthetics of the city, while being more efficient.”
One member of the MGC, Council Vice President Orlando Ramos, objected to the new design, “saying he’d counted on the economic potential of bringing a new high-rise to the city.” That said, another Commission member, Tim Rooke, said he “cares less about having a tall hotel than having visitors on the streets.”
The Commission sought further details regarding the changes and the longer time needed before opening, both of which have increased the project’s overall costs. MGM explained that “redesigning the hotel will save about $50 to $75 million,” explains NEPR, “and yet the overall project cost has gone up — by $150 million.”
Ultimately all plans by the MGM require the MGC’s approval.
Find out more about the MGM’s plans for its Springfield hotel-casino at NEPR.
AGA Questionnaire Seeks Presidential Candidates’ Opinions
Las Vegas has emerged as a popular site for U.S. presidential debates during the current election cycle. The first debate by the Democratic candidates was held at the Wynn Las Vegas in October, and the Republicans will bring their collection of candidates to the Venetian on December 15.
It was also recently announced that the final presidential debate before voters go to the polls next November will also take place in Las Vegas at the Thomas & Mack Center on the University of Nevada-Las Vegas campus on October 19, 2016.
Thus does it seem appropriate that the American Gaming Commission is expressly inviting presidential candidates to make their positions known on a variety of issues important to the gaming industry. The exercise also serves the AGA’s purposes “to educate presidential candidates about the $240 billion casino gaming industry and to inform gaming employees about where the candidates stand on key issues.”
The questionnaire gives candidates a chance to voice the degree to which they intend to support the industry and its employees while also asking questions about their impression of voters’ views toward gambling, illegal gambling, connections between the gaming industry and tourism, daily fantasy sports, immigration, the IRS’s plan to track customers electronically, and more. Click here for a copy of the questionnaire being sent to presidential candidates.
Responses will be compiled by the AGA to create a voting guide for casino employees and others with an interest on candidates’ industry-related views.
Photo: “Las Vegas Strip at night - Cosmopolitan and Planet Hollywood view.” Las Vegas Blog. Creative Commons Attribution-NoDerivs 2.0 Generic.
Visit the AGA for more about the questionnaire and its purposes.
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