{"id":32281,"date":"2023-02-01T08:38:13","date_gmt":"2023-02-01T16:38:13","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=32281"},"modified":"2023-09-14T14:03:23","modified_gmt":"2023-09-14T22:03:23","slug":"ohio-dips-ballys-unplugged-macao-booms","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/blog\/ohio-dips-ballys-unplugged-macao-booms\/","title":{"rendered":"Ohio dips; Bally’s unplugged; Macao booms"},"content":{"rendered":"\n
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Here’s one for those of you who believe gambling is<\/em> facing a recession: Revenue in Ohio<\/strong> fell 2% last month (yes, it took the Buckeye State until February to report December’s numbers). The haul was $193 million, which was still 14% better than the end of 2019, if that’s any consolation. MGM Northfield Park<\/strong> maintained its market-leading status with $24 million, up 5.5%. But there was a surprise challenger: Jack Cleveland<\/strong>, close behind with $23.5 million, an 8.5% gain. Other racinos that were revenue-positive (like MGM Northfield) were Scioto Downs<\/strong>, up 2% to $19.5 million and doughty Hollywood Mahoning Valley<\/strong>, up 3% to $13 million. Miami Valley Gaming<\/strong> was flat at $19 million.<\/p>\n\n\n\n\n\n\n\n

Everyone else lost ground. Hollywood Columbus<\/strong> ceded 1% to $22 million and Hollywood Toledo <\/strong>tumbled 9% to $18 million, while Hard Rock Cincinnati<\/strong> slipped 3% to $20 million. Jack Entertainment<\/strong> didn’t prosper at Jack Thistledown<\/strong>, which fell 12.5% to $14.5 million (as its players presumably fled to the shelter of downtown Cleveland<\/strong>). Also taking a hit was Belterra Park<\/strong>, plunging 21% to $6 million. Rounding out the picture was Hollywood Dayton<\/strong>, stumbling 10% to $12 million.<\/p>\n\n\n\n

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Bally’s Corp<\/strong>.’s hyper-aggressive expansion into the sporting field is backfiring big-time. Bally’s hitched its wagon to the Sinclair Broadcasting<\/strong> star and now hyper-leveraged Diamond Group<\/strong> is filing for bankruptcy<\/a>, threatening the viability of 19 regional sports networks (all Bally-branded). Sinclair can’t even meet a $140 million interest payment. \u201cYou\u2019re looking at a potential rewrite of the entire regional sports business on the other side of this restructuring,\u201d telecom analyst Davis Hebert<\/strong> told Bloomberg<\/em>. When it does come out the other side, Diamond will be mostly owned by creditor financial institutions, who will be looking to shop it around. But if doesn’t<\/em> go into Chapter 11, Diamond will face a $2 billion balloon payments to all those RSNs.<\/p>\n\n\n\n

Cash-poor Diamond isn’t able to meet that obligation, meaning that Bally’s won’t have sportscasts on which to hawk its product. When you don’t even have 1% market penetration<\/a>, that’s not good news. Let’s tot up Bally’s digital spending spree: $2.6 billion for Gamesys<\/strong>, $192 million for Bet.Works<\/strong>, $118.5 million for Monkey Knife Fight<\/strong> (already back on the market, probably to be sold at a loss), $42.5 million for SportCaller<\/strong>, “fan engagement platform” Telescope<\/strong> $26 million, $10 million for the Association of Volleyball Professionals<\/strong>, and finally almost $8 million for “experience designer” Degree53<\/strong>. What is the likelihood some or all of these (poor) investments will be written down on or before the next earnings call? Pretty high, we’d say.<\/p>\n\n\n\n

According to Legal Sports Report<\/em>, “The nearly\u00a012.1 million<\/strong>\u00a0in shares distributed for these deals were worth\u00a0$651.9 million<\/strong>\u00a0when their respective acquisitions closed. They are currently worth\u00a0$236.9 million<\/strong>\u00a0based on Friday\u2019s closing price of\u00a0$19.61<\/strong>.” (emphases in the original) It’s difficult to acquire new customers when RSN viewership is falling 11% and many of the broadcasting deals are underwater, such as $60 million pact with the San Diego Padres<\/strong>. In the meantime, Chairman Soo Kim<\/strong> continues to run Bally’s by the seat of his pants, as when he proclaimed the Sinclair deal would<\/a> \u201crevolutionize the U.S. sports betting, gaming and media industries.\u201d Kinda didn’t, did it? CEO Lee Fenton<\/strong>, who gets paid to put the best face on bad news, said the tarnished Diamond assets still \u201cform part of our plan, and we think we get tremendous best-of-branding benefit from it.\u201d That’s their story and they’re sticking to it … until the 4Q22 earnings call anyway.<\/p>\n\n\n\n

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To end on a positive note, Macao<\/strong> casino earnings vaulted 82.5% last month<\/a>, hitting $1.4 billion for January. It didn’t hurt that 500,000 tourists flooded the enclave during the Chinese New Year period. Stocks of the affected companies nudged upward as much as 5%, even though Macao was still at only half the level of January 2019. All things considered, that’s a healthy comeback, pardon the pun. “We’re just thrilled to be open and making money and seeing demand like we’re seeing,” said Las Vegas Sands<\/strong> CEO Rob Goldstein<\/strong> last week, leaving aside the question of how places like Venetian Macao<\/strong> are going to boost their non-gaming revenues from 5% of the aggregate to an empyrean (by Macanese standards) 30% of total. It’ll be difficult in the early going, as workers for non-casino positions are currently hard to find. In Sands’ case, it’s keeping some of its hotel inventory shuttered until the job market warrants otherwise.<\/p>\n","protected":false},"excerpt":{"rendered":"

Here’s one for those of you who believe gambling is facing a recession: Revenue in Ohio fell 2% last month (yes, it took the Buckeye State until February to report December’s numbers). The haul was $193 million, which was still 14% better than the end of 2019, if that’s any consolation. MGM Northfield Park maintained […]<\/p>\n","protected":false},"author":83928,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[1728],"tags":[],"jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/posts\/32281"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/users\/83928"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/comments?post=32281"}],"version-history":[{"count":0,"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/posts\/32281\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/media?parent=32281"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/categories?post=32281"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/shop\/wp-json\/wp\/v2\/tags?post=32281"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}