Nevada gambling revenue falls 13.7 percent in Feb; Strip casino winnings down 20%

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Not a lucky month for Loveman and Murren et al.

Is America tapped out?

Are better comps on the way (similar to 2008-2009)?

Are Americans & Chinese NY celebrants giving the middle finger to $25 nightly resort fees; $10 phone reservation fees and 6/5 Video Poker/Blackjack?

Casinos statewide reported a win of $926.1 million in February, down from nearly $1.1 billion raked in during the same month the year before.

The tumble on the Strip, home to Nevada's posh resorts, was even more dramatic. Casinos there reported gambling revenue of $555.7 million, down 20.1 percent compared with $696.1 million won in February 2013, the state Gaming Control Board said.

Elsewhere in the state, clubs in downtown Las Vegas posted a 3 percent gain in gambling revenues to $43 million, while Reno casino revenue inched up nearly 1 percent to $44 million. At South Lake Tahoe, casino winnings fell 9.5 percent to $14.7 million.

[YOUTUBE]3fdZWbIsrFk[/YOUTUBE]

 

I like the fact that things are going well downtown. Hopefully there is a correlation between the better gamble that downtown offers vs. the strip and that the decision makers recognize this and then do something about it. It's a lot to hope for but after reading the thread about BJ conditions at V/P I can't fathom how they are making more money in their BJ pits. Regardless of what happens on the strip I'm very happy that the casino operators downtown are being rewarded for their business model.

 

I think the more relevant numbers especially for CET is the online poker

8.5 million on 10 months that is $850,000 per month and if I was reading (the poorly written article) correctly that is just for Nevada, but still if you multiply that by 50 states it is about 50 million a month...giving credit for Nevada being a small state, but recognizing that large states (besides Texas) all pretty much have ready access to gambling)

50 million per month is $600,000,000 per year, but that would be for ALL states and ALL companies offering online poker and when CET is losing about $600 million per month (1.8 billion the last quarter of 2013) I don't think that $600 million a year in new revenue (even if CET captures it all or it grows over time) really digs them out of a hole

 

No surprise there and Corporate Las Vegas has nobody to blame but themselves. They want to be known now as a resort destination, not a gambling destination. Beware of what you wish for.

 

I wouldn't read too much into it. Its one month, most months over the past year have shown growth month-over-month and revenues for their fiscal year are still slightly up. What the article doesn't mention is that while this Feb showed a big drop over last Feb, that last Feb showed a huge gain. It was an outlier with a 15% gain statewide and a 31% gain on the strip.

http://gaming.nv.gov/index.aspx?page=172
http://gaming.nv.gov/modules/showdocument.aspx?documentid=7765

Plus you need to factor in things like any change in overall gaming supply, which includes both gaming positions but also availability (e.g. if casinos are keeping fewer tables open to save on cost).

I'd love to see the degradation of playing conditions manifest itself in their numbers as much as anyone, but its going to take a sustained trend of falling months in order to do that. Right now I don't think that is the case.

 

I think revenues will continue to go down since prices are rapidly increasing and gambling on the strip is just not as worthwhile.

 

OOps. Didn't realize I'd already replied.

 

As the casino's charge more for everything else around it, wouldn't it make sense that the numbers would drop? If rooms cost more, food cost more, and entertainment cost more, it would only make sense that the gambling revenue would start to consistently drop.

Hopefully they'll put the blame on the poor gambling conditions but more than likely they'll panic and make the games even worse.

 

This is true. The trends over the past six months (9/13-2/14) are:

Strip + 1.9%
Washoe + 1.54%
Downtown + 1.27%
Nevada + 0.96%
Boulder - 3.79%

Strip gains are due to tables (mainly baccarat) at 3.26%, vs. machines + 0.15%. Downtown shows better table / worse machine trends (tables + 10.77% vs. machines - 2.0%) and Northern Nevada had a similar experience (+ 8.78% tables vs. -0.1% machines).

That said, I expect gaming trends to continue to flat-line/erode on the strip, as more space and capital are devoted to non-gaming activities, and also do to poorer gaming. The ever growing fees seek to capture lost gambling revenue. Vegas already crossed a significant threshold when non gaming revenues (hotel, food, bars, etc.) surpassed gaming revenue on the Strip several years ago.

 

I think this is a very much multi faceted issue myself. The first is the simple fact that gambling especially slots is pretty much available everywhere around the nation within a 3 hour drive. If people are gambling in their home or neighboring state then the money they would spend in Nv in general is not going there flat out. Next is the economy in general, it's in the tank, unemployment increased yet again in much of the nation last month, wages have been stagnant in most states and no job equals no money and damn sure no luxury spending. The last and I think this may well be the biggest is the fact airfare is RIDICULOUS compared to a year ago. You may get lucky but as in our case our June trip airfare is 360 each for two on in and outbound and that is only because we caught a couple of those Tuesday specials on SW, the same flight we booked for return at 180 is now 332 and has been there for over a month.

 

Can't argue the airlines increases, Bubba. They are ridiculous. Especially for me, flying out of a regional airport. It's like 3 carriers have a stranglehold (translated monopoly) on pricing here.

 

I know, the wife and I have said several times if we could get airfares like we were in 09-10, which we were paying 99 each way, we would go to Vegas at least every 6-8 weeks and never visit the locals.

 

The numbers swing widely based on what the casinos can hold on Baccarrat. If the gamblers have a good streak on it, the numbers will look like crap even if actual gaming activity is up. Also, they don't report simply on calendar month and there were a few fiscal months last year that benefited for an extra weekend. Don't recall if Fer. 2013 one on of those or not. The article is just not a good analysis of what is going on. I would pay more attention to occupancy rates and McCarren activity if I were looking for evidence of a downward trend.

 

This. Most people have a budget for a trip. With higher priced hotels, resort fees, drinks, food, shows, etc, naturally that leaves less for gaming.

And isn't this what Vegas wants? They've been pushing higher end restaurants, clubs, pools, etc. What did they expect would happen with gaming revenues?

 

Well said... there's always the rush to get one's personal agenda or thoughts to fit the numbers and claim "that's the reason why".

Personally, except for one nice $1,000 slot hit (no tax form thank you) on my wife's birthday, I (we) sure contributed our share, both at The Lake and in LV. I've gambled more in the past 6 months that I've done in a loooong time.

 

And here you are always trying to convince us you go to Vegas for business.:evillaugh

 

Adjusted for inflation:

Las Vegas Strip 2007: $7.62B in 2013 dollars (or $820 Million decline).
New Jersey 2007 + inflation + 0.0% Growth = $5.49B (or a near 50% decline).
Northern Nevada 2007: $1.049B in 2013 dollars = $1.17B vs. $0.75B 2013 actual

Las Vegas Strip 2000: $4.8B = $6.42B in 2013 dollars ($80 million growth over 13 years).

Las Vegas Downtown 2000: $673M = $900M in 2013 dollars.
Las Vegas Downtown 2013: $501M.

Gambling is a poor long term trend which does not show any sign of reversal.

 

One has to wonder if the awful weather in the Midwest and East during Feb, and the airlines struggle to deal with it had some affect. How many trips were cut short or cancelled all together?

On the flip side, if ones flight is delayed on the way home, most people will wait in out at the airport trying all their option vs spending it at a resort. Anyone have the statistics for the amount of money gambled at McCarran this Feb vs last year?

 

Ha!! That's EXACTLY what my wife said!!!!! :evillaugh

 

I don't know how many people would normally plan vacation to Vegas in the winter from the Midwest. I do to save money but I don't think there are many like me. But if you were here this winter and decided you had to get away, you would have gone somewhere out of the country and really warm.