Category: Casino News

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Station sets revenue records, Penn less fortunate

Having quietly broken ground on $750 million Durango Station, proud papa Station Casinos announced that despite “some headwinds,” the company had achieved record-level cash flow in 4Q21. “The government’s mask mandate across the state of Nevada remained in place and we definitely felt the effects, along with increased inflationary pressure on ordinary goods and services,” said CFO Stephen Cootey of the aforementioned headwinds. Fortunately for Station, customer spend per visit was up, as was time expended playing the slots. As for rooms and F&B, it was the most profitable fourth quarter in Station history. Older customers continued to stay away but 21-to-25-year-olds more than made up for them, playing in greater numbers (60%) than in 2019.

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Venetian: The fix was in

As usual when billions are on the line, regulators dove under the table regarding the sale of Venelazzo to an unholy alliance of Apollo Management and Vici Properties. Although the Nevada Gaming Control Board cried foul—and rightly so—at the sexual predations of Steve Wynn, it turned a blind eye to similar malfeasances by principal (12%) Apollo shareholder Leon Black. The latter had to step down as Apollo chairman for having “paid convicted sex offender Jeffrey Epstein $165 million for financial advice.” Is that what the kids are calling it these days? The 70-year-old billionaire is also under investigation for having allegedly raped a Jane Doe at Epstein’s Manhattan crash pad back in 2002. (Classy gent that he is, Black is having his lawyers shame the alleged victim.) The Epstein/Black connection is a tangled one … and this is the man Nevada regulators are prepared to gift with one of Las Vegas‘ premier resorts.

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New boss at F-blue; Station: Five white guys; Atlantic City blitzed

Yes, Tom Brady has retired but there’s actually other news happening today. For starters, Fontainebleau has a new president. And not just any prexy but “a visionary leader for our next-generation luxury resort.” He’s Cliff Atkinson, late of Luxor. If anything about that last sentence strikes you as incongruous it’s that Luxor isn’t exactly F-blue’s price point. Fortunately, Atkinson does have experience in the top tier of Las Vegas Strip hospitality, having served as general manager of what used to be Mandarin Oriental at CityCenter, a tenure that earned him the sobriquet “Hotelier of the Year” from the Nevada Hotel & Lodging Association. Although you’ve probably never heard of him, Atkinson is described by Jeffrey Soffer‘s PR team as “one of the Strip’s most dynamic leaders.”

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Florida: Phhhhht …; Crackdown in Macao; Scandal at Parx

That hissing sound you hear is the air going out of DraftKings‘ and FanDuel‘s electoral balloon. Florida Education Champions, their front group for bringing online sports betting to the Sunshine State, folded its hand, conceding that it can’t get enough signatures to qualify for the November ballot. It says it’s “reassessing long-term options, still hoping one day to get voter approval for legal online sports gambling in Florida.” FEC says it collected over a million signatures, but only 471,536 could be verified. “While pursuing our mission to add sports betting to the ballot, we ran into some serious challenges, but most of all, the COVID-19 surge decimated our operations and ability to collect in-person signatures,” FEC complained, failing to add that the dog ate its homework. All gambling-related signature drives, had they made the ballot, might have faced serious voter backlash, given the in-your-face petitioning tactics alleged, which included encroachment upon private property.

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Adios, Tropicana?; New York sports betting tops $1 billion easily

Sunset for the Trop? (Photo: John Patrick Ross/Shutterstock)

Visit the Tropicana Las Vegas while yet you can. Why? Because Bally’s Corp. Chairman Soo Kim is seriously weighing the possibility of “knocking it down and starting over.” Yes, Kim would rebrand the place as Bally’s Las Vegas and then blow it up. Possibly. Mind you, Bally’s doesn’t own the physical assets of the Trop but is renting them from Gaming & Leisure Properties, which would have to sign off on such a radical move. Also, how long could Bally’s afford to pay rent on a site that isn’t generating a cent of cash flow, post-implosion? We’ll leave aside the small matter that Bally’s has never built anything remotely on the scale of a Las Vegas Strip megaresort, which is one of the strikes against it in Chicago presently.

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Horseshoe returns to Vegas; LV Sands thinks big

The Horseshoe-to-be (Marnell Cos.)

In the year’s worst-kept secret (or least surprising news story), Caesars Entertainment is finally rebranding Bally’s Las Vegas as the Horseshoe to end all Horseshoes. We were all over the story yesterday, in case you want the full monty. A game of musical chairs will ensue, since the displacement of the Bally’s name frees it up for Bally’s Corp. to slap it on the long-suffering Tropicana Las Vegas, part of a full rebrand of all of Chairman Soo Kim‘s assets except (sensibly) Hard Rock Biloxi. In at Horseshoe-to-be is “a handcrafted feeling with tooled leather, dramatic colors, and the brand’s signature gold horseshoe iconography.” Out, we hope, will be Real Bodies and some of the other low-rent aspects of the property as it is.

The return of Horseshoe to Vegas where it belongs overshadowed today’s revenue report on Nevada casinos. Strip gross gaming revenue of $651 million was up in December by 10% over 2019, while locals momentum slowed a bit, to +5% and $229.5 million. Players were openhanded on the Strip, with slot coin-in up 22% (driving an 18% increase in win to $377.5 million) and table wagering 13% higher (a robust +32% and $188 million once baccarat is factored out). Baccarat was, indicated, a weak spot, down 15% in volume albeit 16% higher in revenue and despite low hold. Visitation to Las Vegas remained 9% below 2019, at least with regard to travelers passing through Reid International Airport. Domestic travel was only 5% off but international flow was down 58.5%.

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Bally’s we hardly knew ye; IGT bets big on lotteries

Shares of Bally’s Corp. sprang to $36.76 apiece yesterday on the news that the company’s largest stockholder wants to take Bally’s private for $2 billion. Hedge fund Standard General—founded by Bally’s Chairman Soo Kim—is offering $38/share for the mini-major and selling the idea as a way of ameliorating risk (not that we thought of BALY as a particularly perilous play). Standard General already owns 21% of Bally’s.

Normally we would frown upon such a proposal, as private equity has a mostly disastrous record in the casino industry. However, the presence of Kim in both camps is reassuring. He put the current Bally’s management team into place and is likely to keep giving them his ear. The LBO would be financed by the sale and lease-back of unspecified assets. Jefferies Equities analyst David Katz said Bally’s would go for cheap, as the offer didn’t price in the value of the Gamesys acquisition: “With the current market context for dismissing value on North American digital opportunities, the offer is opportunistic.”

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Sports betting claims first casualty; “Scam” at Caesars?

Online sports betting has evidently proven too rich for Wynn Resorts‘ blood. The New York Post reports that Wynn “is looking to unload its online sports-betting business at a steep discount as the fledgling niche faces painful losses from stiff taxes and costly promotions needed to lure customers.” Wynn Interactive, valued at $3.2 billion, is being peddled for $500 million. This will come as bad news to Shaquille O’Neal, who unloaded his share of the Sacramento Kings in return for becoming a “brand ambassador” for Wynn, which also built a ritzy Las Vegas broadcasting studio to showcase its product. There were rumblings from the top that Wynn and OSB were an uncomfortable fit. CEO Matt Maddox had told investors, “The market is really not sustainable right now. Competitors are spending too much to get customers. And the economics are just not something that we’re going to participate in.”

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Adele fiasco at Caesars; Trouble for Sands in Florida

Resorts World Las Vegas, we’ll see your Celine Dion health-scare postponement and raise you an Adele cancellation at Caesars Palace. The British megastar’s team has, like so much of the human race, contracted Covid-19 and is not physically capable of grinding out a Vegas residency at this point. We wish them a speedy recovery—and a contract extension. There are skeptics about the matter, asserting that the show simply wasn’t ready and that there would have been empty seats galore (we blame the greedy secondary market). Indeed, nixing 13 weekends of shows on account of Covid-19 seems an extreme reaction. Did Caesars Entertainment rush this show to market to one-up Resorts World? It kinda looks that way. Tickets sellers seem to have sensed this, judging from a precipitate, last-minute drop in prices.

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Warm breeze in Atlantic City; Indiana heats up

December brought an acceleration in most forms of New Jersey gambling revenue. Atlantic City casinos managed a 1.5% increase over the end of 2019 but sports betting revenue dropped 11% year/year, blamed on low hold. Sticking close to home, Internet gamblers lost 34% more than last year, the brightest spot on the horizon (unless you were a player). Boardwalk grosses were $212 million, i-gaming yielded an impressive $133 million and sports betting engendered $59 million. Slot revenue was flat at $150.5 million on 2% less coin-in while table games captured $59.5 million (+5%) on 10.5% less wagering. Borgata stabilized at -1% or $54 million, too late to save Melonie Johnson‘s presidency. Hard Rock Atlantic City vaulted 37% to $35.5 million while Ocean Resort climbed 27% to $26.5 million.

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