If you look at things from the casino-resort's point of view, have they increased the cost of nearly everything to customers to make up for the huge losses they had in 2020 and early 2021? Perhaps they're just now getting back to even from the horrible 2020 year? Surely, they lost millions/billions in 2020, not just in Las Vegas but at all their locations.
According to the Nevada Gaming Control Board, casinos in the Silver State lost $206 million in the fiscal year ending June 30, 2021. To put that in perspective, the same 302 casinos registered $2.9 billion of profit in the mid-2019 to mid-2020 period.
In the last 10 months, customers have been gambling more than ever before, setting revenue records for Nevada that we, quite frankly, thought would never be reached after the Great Recession of 2008-2009. The totals for 2021 came out a couple weeks ago and statewide, Nevada casinos won $13.4 billion, setting a new record by surpassing the previous one of $12.8 billion set in 2007. The Las Vegas Strip also set a new revenue record last year.
However, this hasn't stopped them from resorting to a variety of measures designed to further shore up the bottom line.
Take employment: 18% of jobs have been lost, with employment falling from almost 136,000 to about 111,500. Casinos in Las Vegas are doing 12% more business than in 2019 with 30% less staffing. And contrary to the employment "challenges" that casino operators are fond of moaning about when they talk to reporters, it’s not because workers are hard to find. Thousands of Culinary Union members are still looking for jobs.
Rather, while running with skeleton crews during the worst of the Great Pandemic, casino operators realized how profitable it could be by staffing up to only the minimum level that they dared without threatening profit and cash-flow margins. They say in public that good help is hard to find, but when talking to Wall Street analysts, boast about the margin improvements they've achieved and disclose that, even when they staff up, it will be short of 2019 numbers.
Oh, and forget about getting your room cleaned during a hotel stay. Or eating at a buffet. Or finding a blackjack table that takes $5 bets.
Such niceties have gone the way of the dodo in the name of fattening profits. Not only are resort fees here to stay, they’re spreading. The struggling Virgin Hotel recently reneged on its no-resort-fee pledge and is charging you for things you use (wi-fi) and don’t (the phone by the toilet). Some casinos hide behind health-and-safety excuses for certain of these eliminations (cleaning, buffets), but they’re actually trying to eradicate what they consider loss leaders.
Late last year, Station Casinos, for another example, bought back $350 million of its common stock and paid a generous $3-per-share dividend to its stockholders. The company said in a statement, "It not only shows the position of strength from a cash-flow and balance-sheet perspective, but also returns capital to shareholders, while leaving the company still well positioned to develop the pipeline.” In other words, we're making so much money that we can spend a third of a billion on our own stock (boosting the share price), pay dividends, and have enough left over for further casino development (the $750 million Durango Station for one).
So we wouldn't feel too sorry for the casinos, especially in Las Vegas. Readers of LVA and QoD are only too familiar with the “Less Vegas” culture of less product for more money. If you’re determined to take a Las Vegas vacation, expect an experience closer to that of a regional casino — just much more expensive, with worse service.
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Kevin Lewis
Feb-10-2022
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Donzack
Feb-10-2022
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Bob Nelson
Feb-10-2022
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[email protected]
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Jeff Darling
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Lotel
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Luis
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kafka45
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David Sabo
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Llew
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Diane Crosby
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Sam Glantzow
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John Lopez
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Doc H
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VegasVic
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steve crouse
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O2bnVegas
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Lucky
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David Miller
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Roy Furukawa
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Doc H
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DwWashburn9
Feb-11-2022
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