Casino revenues last month in Pennsylvania must have been riding a pogo stick — up 13% from last year. That includes a 39% moonshot in table revenues. Leaders include Sands Bethlehem (22%, right), while Penn National‘s eponymous racino must be counted a disappointment, up 1% in September but -1% for the quarter to date, thanks to flat slot revenues. Sands, by contrast, overshot expectations: slot revenues rose 9% and tables 78% (!), with another month to go before the effects of Resorts World New York begin to manifest themselves. Considering that RWNY will only have mock table games and VLTs, S&G now expects it will only make a minor dent in Sands’ performance.
In plain old dollars and cents, Parx Casino‘s $41 million (+7%) was tops for the state, although Sands ($8.7 million) is now the premier money-maker in the table-game subcategory — grossing almost 3X as much as Penn did. (Penn’s rejected Aqueduct Racetrack concept is seen at left.) Except for Presque Isle Downs (-4%), all outlying casinos had positive months, led by The Meadows racino’s $24 million (+3%). In downtown Philadelphia, one-year-old SugarHouse has leveled off at $21 million since March. Further out, Harrah’s Chester Downs ($28 million) continues to slip, down -2.5%. The inexorable forward march of Rivers Casino ($29 million) continues apace in Pittsburgh. The sequential gains are getting smaller but Rivers’ 13% growth in September revenue is nothing at which to sneeze.
Motown on the march? A labor story that’s been flying just above the radar is the imminent strike at casinos in Detroit. Both sides are keeping mum in the talks. However, this would be an unbecoming time for management to poor-mouth employees, as the market has been up 3% YTD, weighed down only by unstable management at Greektown Casino, perennial underachiever of the threesome. MGM Grand Detroit and Motor City Casino have had a better-than-expected 2011 (just like the Detroit Lions), and workers’ paychecks ought to reflect that fact. Caesars Entertainment, though, has to be rubbing its hands at the thought of a strike, which might finally drive more traffic to Caesars Windsor (above). While there, you can strike a blow for personal liberty by lighting up a bonafide Cuban cigar — a privilege not afforded in the Land of the Free.
Penn vs. Caesars. While the two companies have common interests — at least for the moment — in Ohio, there’s no detente where interstate competition is concerned. Rather than sit and wait for incoming salvos (and outgoing players) courtesy of Horseshoe Cincinnati, Penn is taking the offensive … with more than a little help from Big Government. The City of Lawrenceburg is loaning the suddenly penurious Penn $14 million, repayable over 20 years. On top of that, Penn gets an outright $25 million grant plus $10 million in tax-increment financing.
For $1 million upfront, Hollywood Casino Lawrenceburg — helmed by former Harrah’s New Orleans general manager Joe Hasson (right) — gets a restaurant, exhibition hall, ballroom and a 180-room hotel. Lawrenceburg expects to take a $7.4 million loss on the deal. In addition to fending off Caesars’ Cincinnati advance, Penn hopes to strike at convention business currently bound for Pinnacle Entertainment‘s nearby Belterra resort. Now let’s see if Caesars goes to the Cincy city fathers and demands a comparable hotel of its own. (The company has a long history of shamelessness when it comes to moving the goal posts.)
It looks as though not all casino CEOs are averse to guvmint stimulus … not when they can get some of it for themselves, anyway.
