Maybe the ‘skinny stimulus’ helped Ohio. Gross gaming revenues of $153.5 million were only 8.5% off last year’s pace. The gambling houses are still operating at 50% capacity and under a curfew but the number remains impressive. Hollywood Toledo continues to benefit from the closures in Detroit (recently lifted), up 14.5% to $18 million. Hollywood Columbus declined 12%, also to $18 million. As for Penn National Gaming‘s two racinos, Hollywood Mahoning Valley grossed $12 million, minus 3% and Hollywood Dayton, up 6.5%, also pocketed $11 million. Belterra Park showed signs of stabilization, down 9% to $6.5 million. Scioto Downs had a good month, down only 1% for $15.5 million. MGM Northfield Park was in a three-way tie for first place, grossing $18 million (a 21.5% tumble). Jack Cleveland, now with 100% less Dan Gilbert, was down 10% to $16.5 million whilst Jack Thistledown gained 13% to $13 million. Hard Rock Cincinnati continues to struggle, plunging 34% to $12.5 million. That only leaves Miami Valley Gaming, down 12% to $14 million.

An extra weekend day may have helped Ohio but it didn’t do squat for Illinois, where gambling revenues fell a catastrophic 74%. How come? Casinos were closed half the month, had to shut down nightly at 11 p.m. and were restricted to 25% of capacity. Whatever pent-up demand existed wasn’t sufficient to even partly compensate. Gross gaming revenues were a pitiful $26 million. Heck, Rivers Casino Des Plaines does that and more in a good month. In this case, Rivers towered over the market with $9 million (-77%) with nobody else coming close. In terms of retaining pre-Covid market share, Boyd Gaming‘s Par-A-Dice did best, off 46% to $2.5 million. Jumer’s Casino Rock Island continues to look like a terrible investment for Bally Corp., eking out $1 million (-72%). It did incrementally worse than DraftKings at Casino Queen, just over $1 million and -82%.

Continue reading Normality in Ohio, disaster in Illinois; Planet Ho sale mooted

Caesars Entertainment, aka Eldorado Resorts, has become possessed by the evil spirit of spare-every-expense Columbia Sussex. In one of the most odious of recent cutpurse moves, bartenders have been ordered to short-pour liquor: The ‘new normal’ is .75 ounces per drink, meaning you’ll have to buy more drinks in order to get that buzz going. Caesars has been the prime offender in recent moves such as jacked-up table limits but this story, broken by Vital Vegas, has clearly struck a nerve, going viral in no time flat. (Viral Vegas?) CEO Tom Reeg had already established a reputation for cheeseparing but this move couldn’t have been better designed to alienate customers if he tried. Much more of this and Sin City will lose its cachet as a bargain destination, if it hasn’t already.

To get to the nub of the issue, Linq has essentially halved the amount of liquor that will be poured into your Vodka Cranberry but will of course charge you just as much for it as though it were actually a stiff drink. (It’s 1.25 oz. per pour at MGM Resorts International, in case you wondering.) Vital Vegas paid a visit to Linq and found it in a significantly down-market state: “there were virtually no customers. Entire swaths of table games have been removed and replaced with slot machines. Such moves make some sense given low demand (table games involve much higher labor costs), but even if these changes are temporary, you’d think casinos would want to draw customers, not repel them with weak drinks.” Indeed.

Continue reading Welcome to Less Vegas

It’s earnings-report time for Wynn Resorts and JP Morgan analyst, Joseph Greff, for one, is feeling blasé about the numbers. “Overall, we’d characterize the quarter as in line with investors’ recent expectations, and its earnings conference call outlook commentary as appropriately hinged on a resumption of travel that is predicated on a decline of COVID-19 infection rates and an acceleration of vaccination rates,” he wrote. Luckily for Wynn, its preferred Macao sector (premium mass-market) is outperforming the mass-market and VIP ones. While Sands China saw a 61% plunge in table-game wagering, Wynn had a victory of sorts by being down only 51%. Wagering volumes in Las Vegas were described as “impressive,” thanks to weekend play and California drive-in business. 4Q20 table game and slot handle were 72% and 85% of comparable 2019 levels, which bodes well for recovery. Still, Greff thought cash flow would be “stuck” at recent levels until Coronavirus vaccines are more widely promulgated.

The Morgan analyst shaved five bucks off his target price for WYNN, to $119/share, but encouraged buying on any downticks in the stock. Early-2021 cash flow projections were more optimistic for Wynncore (-4%) than Macao (-27%), but rosiest of all for Encore Boston Harbor, given a 16% boost. Internet gaming is slow to obtain traction, posting a $38 million negative return on investment. Looking over the horizon, Greff sees Wynncore gaining 5% more cash flow, bringing it to 93% of 2019 levels. Macao is dicier, only 83% of 2019 levels, led by slot play. VIP win is predicted to be 36% of 2019. At least Wynn Palace appears to have turned the corner, dwarfing Wynn Macau in EBITDA. Cash flow from all sources was $70 million for 4Q20, with Macao contributing $39.5 million and Vegas $21 million (on $173 million in revenue). Those numbers were above expectations and, going forward, “3Q/4Q events are hanging in (at least for now).” Whew.

Continue reading Wynn surprises few; Maryland stabilizes, Iowa impresses

It was a $6.6 billion rescue package that Golden Nugget CEO Tilman Fertitta received, in the form of a merger with FAST Acquisition. Fertitta’s been hard up for cash and forks over a portion of his casino empire in return for some badly needed liquidity. The deal gives FAST “voting control and ownership by the Company of approximately 31 million shares, or nearly half of all outstanding shares in Golden Nugget Online Gaming (NASDAQ:GNOG) … Mr. Fertitta will also be the company’s largest shareholder, with an approximately 60 percent interest in the company and stock valued upon the closing of the transaction in excess of $2 billion dollars.” The Nuggets will also be getting a $1.4 billion infusion of public equity capital. FAST stock hopped 20% on the news. The Bubba Gump’s, Chart House, Del Frisco’s, Mastro’s and Morton’s restaurant chains are also included in the deal, for which some feel gaming was an afterthought. However, the Nuggets have been outperforming the rest of the casino industry in recent stages of the pandemic. Public investors, take heart: 4% of the company will still be put up for sale.

A casino in Times Square? It could happen. L&L Holding Co. has pitched the idea of a $2.5 billion megaresort at 1568 Broadway, part of a larger, mixed-use development (hotel, retail, concert hall, all that jazz). Not having gaming experience, L&L is looking for a joint-venture partner (Las Vegas Sands, take heed). This isn’t the only casino being proposed for Manhattan: a Herald Square one has been floated by Vornado Realty Trust. Both developers seem to be banking on economic and political pressure to accelerate the 2023 deadline for opening New York City to full-fledged casinos. At present, L&L is proceeding, in part, with EB-5 loans from foreign investors, a business model with which Las Vegas is well acquainted.

Continue reading Bailout for Tilman; Casinos to the Big Apple; Mega-Jottings