Question of the Day - 11 September 2015

It's a done deal. Although Caesars continues to manage (for a fee and a percentage of gaming revenue) Horseshoe Casino Cincinnati, Horseshoe Casino Cleveland, and ThistleDown Racino, it sold its 20 percent stake in Rock Gaming Caesars (now just Rock Gaming) back in February. The liquidation price was not disclosed. All three remain part of Caesars' Total Rewards network. "We will continue to provide the same high quality experience and service guests have come to expect and remain committed to our casino investments and the communities where we operate," Rock Gaming CEO Matt Cullen told the Cincinnati Enquirer. Sports fans may recognize Rock Gaming as the gambling company controlled by Cleveland Cavaliers owner Dan Gilbert.

Although Caesars continues to run the casinos and racino on a day-to-day basis, things have taken a turn for the worse since the company's bankruptcy. Horseshoe Cleveland has fallen from first to third place among Ohio casinos and ThistleDown's revenues have declined precipitously (down 22 percent in August). Meanwhile, suburban Hard Rock Rocksino has made short work of ThistleDown and steadily climbed to the number-one spot in the state, a feat all the more impressive because Hard Rock doesn't have table games, unlike Horseshoe Cleveland.

The one silver lining in this cloud is that Horseshoe Cincinnati continues to grow market share, pulling in gamblers from Indiana. It tried to cater to smokers by creating an outdoor slot-machine area. However, this "patio" is enclosed on all four sides, so the health department penalized it. Caesars' liquidation of its Ohio assets is a double defeat for the company, in part because it's exiting a growing market … but also because it sold a lucrative Missouri casino (Harrah's Maryland Heights) to arch-rival Penn National Gaming to help pay for the Ohio adventure. Now Penn has one of the best-performing casinos in the St. Louis area and Caesars has almost nothing to show for itself. With past decision-making like that, it's perhaps little wonder that Caesars finds itself in this current financial predicament.

Having received the following from a reader, we realized there was an error in this answer as it originally appeared, as we had been under the impression that the outdoor-smoking-area concept had not actually been realized, which is not the case. "Just an FYI: I live about 20 minutes from Horseshoe Cincinnati. The smoking patio opened a year or so ago and is still open. The issue isn’t regulators. Rather, health department inspector found that HS lacks the required openness to be considered 'outdoors'. HS is contesting the health department's interpretation of the law."