Inside Gaming: Second Straight Monthly Decline for Nevada Casinos
This week's installment of Inside Gaming starts with another monthly decline in gaming revenue in Nevada, looks in on a Congressional hearing to consider federal sports betting legislation, and shares industry news from the Philippines.
Nevada Gaming Revenue Declines in August, Strip Down 12.4 Percent
Another month has already passed, which means another monthly revenue report from the Nevada Gaming Control Board. August saw the state's casinos endure another decrease, with revenues down for the month 7.7 percent year-over-year. That's the second straight month of declines, following the slight dip of 0.16 percent in July.
Meanwhile casinos on the Strip, down 5.75 percent in July, were down again, this time 12.4 percent.
The NGCB's August report shows the state's casinos collectively reporting a total win of just under $913 million, down from the $989.5 million of August 2017 and the lowest month in terms of revenue so far in 2018. Casinos on the Strip accounted for about 90 percent of that decline, earning $447.9 million last month, well down from the $545.5 million of a year ago.
As Howard Stutz notes for CDC Gaming Reports, the decline "wasn't a surprise given all the negative noise coming from casino operators and the investment community about depressed third quarter results in Las Vegas."
"Expectations were extremely low across the board," according to gaming analyst Cameron McKnight, CDC Gaming shares. "We think a negative 12.4 percent headline [for August Strip revenue] is better than expected."
Michael Lawton, Senior Research Analyst for the NGCB, expressed disappointment but not surprise in his comments on the report. As the AP reports, Lawton alluded to the much-hyped Floyd Mayweather Jr.-Conor McGregor super welterweight boxing match in August 2017 as a factor affecting the year-over-year comparison.
"People called it the fight of the century, and it was a pretty big draw and it drove a lot of those gaming numbers for last August," said Lawton. "We didn't have an event this August that was anywhere near replicating something of that magnitude."
In terms of overall visitors to Las Vegas last month, those numbers were in fact quite similar to those from last summer. The Las Vegas Convention and Visitors Authority yesterday reported just an 0.2 percent drop in visitors to Sin City, with about 3.56 million traveling there, according to the AP.
Elsewhere in the state gaming revenue was up in most locations, including being up just under 7.3 percent in Washoe County where Reno is located.
House Subcommittee Holds Hearing on Sports Betting
While most of the country was intently focused yesterday upon a contentious U.S. Senate Judiciary Committee hearing yesterday concerning U.S. Supreme Court nominee Judge Brett Kavanaugh, a subcommittee of the U.S. House Judiciary Committee had its own hearing focused on a very different matter — sports betting in the United States and the future possibility of federal legislation and regulation.
The House Subcommittee on Crime, Terrorism, Homeland Security, and Investigation's hearing was titled "Post-PASPA: An Examination of Sports Betting in America," an allusion to the May SCOTUS ruling that PASPA, or the Professional and Amateur Sports Protection Act of 1992, was unconstitutional, thereby allowing all states' lawmakers to decide whether or not to allow sports betting.
Since that ruling, four states have joined Nevada to offer sports betting — Delaware, New Jersey, Mississippi, and West Virginia — with others indicating intentions to do in the near future. What members of Congress discussed and heard from witnesses regarding yesterday was a new federal law regarding sports betting, even though no bill has been put forward as yet.
Eric Ramsey of Legal Sports Report helpfully provides a blow-by-blow account of yesterday's hearing at which representatives of the American Gaming Association and Nevada Gaming Control Board both spoke, an executive vice president of the National Football League appeared, and spokespersons for the Coalition to Stop Internet Gambling and Stop Predatory Gambling also testified.
The witnesses were predictably divided regarding the need for federal legislation, with the NGCB and NFL representatives both supporting the idea, the AGA representative suggesting state-level legislation is "currently working," and the others (for a variety of reasons) arguing against all forms of gambling.
The Q&A period that followed saw lawmakers making their positions known amid their questioning of the witnesses. Unsurprisingly, the hearing ended inconclusively, although the subcommitte's chairman Jim Sensenberner closed by remarking "for Congress to do nothing [regarding sports betting[ is the worst possible alternative."
PAGCOR Chairman Favors "Casino Cluster" in Manila, But Plans on Hold
The chairman and CEO of the government-owned Philippine Amusement and Gaming Corporation this week indicated support for the creation of a "casino cluster" in Manila similar to the Las Vegas Strip, reports Inside Asian Gaming.
"I wanted to do that," said PAGCOR Chairman and CEO Andrea Domingo in an interview to appear in the October edition of the publication, "but the four original IRs [Integrated Resorts] there are... opposed to a fifth operater and they are asking for the moratorium of five years for the industry to mature."
Domingo explained how PAGCOR has granted the current operators that respite, meaning "there cannot be... another casino operating there, until after February 2022 which is just about the end of the term of this administration."
The latter allusion to current President Rodrigo Duterte's term is not incidental, given Duterte's staunch opposition to any new casino development. In August, Philippines President Rodrigo Duterte delivered a speech stating his opposition to gambling while also putting a halt to a would be fifth IR, Landing International Development, just after it had broken ground on a new $1.5 billion integrated casino project.
In the same interview, Domingo commented as well on previously announced plans to sell PAGCOR-operated casino licenses, indicating the entity's intention to continue as both a regulator and an operator for the near future. PAGCOR currently operates 47 casinos, Inside Asian Gaming explains, and had been ordered last summer by Duterte to sell them a couple of months after he took office.
