Quote of the Day

Posted on November 17, 2014 by David McKee

Resorts World LV“Venice without the Italians would not be Venice. If it’s not highly relevant, it won’t succeed.” — Echo Entertainment CEO Matt Bekkier on the importance of an “authentic” casino experience, one that appeals to locals and tourists alike. One hopes that Resorts World Las Vegas, currently planning a Chinese-centric casino on the Las Vegas Strip, hears what Bekkier is saying.

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Incompatible bedfellows; Freeman seizes the day

Posted on November 17, 2014 by David McKee

Boyd Gaming and MGM Resorts International have gone to bed with bwin.party but may wake up with Anaya Gaming Group. That’s one possible outcome of “preliminary discussions with a number of interested parties” and Internet casinobwin. “Such discussions may or may not result in an offer being made for the company.” On one side is Anaya, prepared to offer $1.86 billion for bwin and on the other is Playtech, which has $493 million stockpiled for acquisitions. Anaya is, of course, the parent company of PokerStars.

Aye, there’s the rub. In Atlantic City, PokerStars is already teamed with Resorts Atlantic City while bwin is Borgata‘s online partner. A Playtech takeover might be even more problematic, as Continue reading →

Posted in Atlantic City, Boyd Gaming, Geoff Freeman, Hard Rock Hotel, International, Internet gambling, Iowa, Marketing, MGM Mirage, PokerStars, Regulation, Sports, Warner Gaming | Comments Off on Incompatible bedfellows; Freeman seizes the day

Silver breaks ranks; Is NHL a done deal for Vegas?

Posted on November 14, 2014 by David McKee

In a bold, if not completely surprising move, NBA Commission Adam Silver took to the op-ed pages of the New York Times to advocate the nationwide legalization of sports betting. “Times have changed … Gambling has increasingly become a popular and accepted form of entertainment in the United States,” Silver wrote. “Most states offer lotteries. Over half of them have legal casinos.”

SloanWhile not reconciling his views with the NBA’s anti-sports betting legal stance in New Jersey (he called for upholding the Professional and Amateur Sports Protection Act of 1992 but also implied it is obsolete), Silver acknowledged it. His arguments also included the 2011 referendum in which Garden State voters “overwhelmingly” approved the practice. “There is an obvious appetite among sports fans for a safe and legal way to wager on professional sporting events. Mainstream media outlets regularly publish sports betting lines and point spreads,” he noted, while also making sure to mention the $400 billion that some estimate changes hands in illegal sports wagering. (Code to politicians: Unrealized tax revenue!)

The legitimacy of sports betting overseas was another fact Stern was Continue reading →

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Impossible choice at Trump Taj; Ultimate Poker busts

Posted on November 14, 2014 by David McKee

Ownership of Trump Taj Mahal has handed down to workers a choice that might be described as being between bad and worse: accept the loss of their health and pension trump-taj mahabenefits or, if Unite-Here continues to pursue an appeal in court, loss their jobs when the casino closes in mid-December. Trump Entertainment Resorts CEO Robert Griffin describes the Taj as “a very sick patient lying on its death bed and his partner, the union, who is supposed to help, is instead hitting him over the head with a hammer.”

Griffin’s rant makes you wonder if even union concessions will be enough to keep the Taj alive, especially since management concedes Continue reading →

Posted in Atlantic City, Carl Icahn, Economy, Harrah's, Internet gambling, Michael Gaughan, Sheldon Adelson, Station Casinos, Taxes, Trump Entertainment Resorts | 2 Comments

Quote of the Day

Posted on November 14, 2014 by David McKee

GaryLoveman_big“Loveman said there is “no scenario that makes any sense to us” that would put Caesars through a court-administered reorganization. “These same people have been predicting the bankruptcy of the company since 2009,” Loveman said. “So far, they have been unsuccessful in having that prediction made accurate.” — Caesars Entertainment CEO Gary Loveman, in a Nov. 16, 2013 profile by Howard Stutz.

Posted in Harrah's, Wall Street | 2 Comments

Hope on the Boardwalk

Posted on November 13, 2014 by David McKee

Down four casinos and counting, Atlantic City suffered a 9% dip last month but a 14% gain on a same-store basis. A 13% fall in slot win and a 12% decline in coin-in seems to Borgatahave driven the slippage: In spite of 19% less table play, luck was with the casinos and they came out 5% ahead. Online play continued to slide (7% off from last year), as PokerStars remains on the sidelines. This development (or lack of one) has inspired much innuendo but little hard knowledge.

Borgata ($52 million) exceeded expectations, posting a 9% revenue increase. It had no trouble scaring up play (+8%) and win rose 15%. Heavier coin-in at the slots (+5%) drove  Continue reading →

Posted in Atlantic City, Boyd Gaming, Current, Harrah's, Internet gambling, MGM Mirage, Mohegan Sun, PokerStars, The Strip, Tilman Fertitta, Tropicana Entertainment, Trump Entertainment Resorts | 1 Comment

Station mixes candor, optimism; Adelson: What’s next?

Posted on November 13, 2014 by David McKee

Station Casinos CFO Marc Falcone wasn’t showing his cards in yesterday’s conference call with analysts. He would only say that, in the wake of Proposition 48‘s defeat in California, Station and the North Fork Rancheria of Mono Indians would explore “other methods of obtaining a compact” in the greater Fresno area. Does this mean Station and N Fork Rancheriathe Mono Indians will settle for a Class II facility? They went the Class III route once before and got shot down by the electorate. They could try another location but the voters are likely to take the same dim view of “reservation shopping” as before. Or the Mono Indians could build on their primary ancestral lands but that’s pretty far off the main drag and it doesn’t enjoy reservation status.

It was a good quarter for Station, with revenues up Continue reading →

Posted in Atlantic City, California, Detroit, Economy, Election, Harry Reid, Internet gambling, MGM Mirage, Politics, Regulation, Sheldon Adelson, Station Casinos, Tribal, Trump Entertainment Resorts | Comments Off on Station mixes candor, optimism; Adelson: What’s next?

Seminole talks to restart; Churchill Downs’ big play

Posted on November 13, 2014 by David McKee

Now that he’s assured of four more years, Florida Gov. Rick Scott (R) can tidy up some unfinished business … like compact negotiations with the Seminole Tribe. The Rick_Scott1$1 billion/five-year deal currently before the two parties would reward that tribal largesse with “exclusive rights to blackjack and other table games.” That doesn’t make it inevitable that resort casinos are toast but it takes away a very great deal of economic incentive. Time to dust off that argument that you can make multi-billion-dollar properties pencil out on 37% gaming revenue. Companies like Las Vegas Sands, which kept their options open, will probably come out of this looking better than Genting Group, whose Miami waterfront acquisition looks more and more rash in retrospect.

The Seminoles aren’t the only ones wanting something from Scott. Parimutuels would like table games (unlikely) and a reduction in their stiff 35% tax rate. Hard Rock International, meanwhile, seems to be gearing up for something big at Seminole Paradise, where it’s torn down three restaurants to make room for a project that management is still keeping under wraps.

* Churchill Downs continues to diversify. Already it has added “instant racing” to some of its tracks. Now Continue reading →

Posted in California, Churchill Downs, Current, Florida, Genting, Hard Rock International, Internet gambling, Racinos, Regulation, Sheldon Adelson, Tribal, Wall Street | Comments Off on Seminole talks to restart; Churchill Downs’ big play

Quack Pack attack

Posted on November 13, 2014 by David McKee

Since it’s the altar on which A&E recently sacrificed Longmire, I don’t have warm feelings about Duck Dynasty, although the network itself goes one better, depicting Phil Robertson and his clan as bizarre backwoods cretins. With a pedigree like that, it was inevitable that show biz would come calling, although not in the form of a TV sitcom — which Duck Dynasty arguably already is — but as a Las Vegas musical, a strange marriage of form and content. For one thing, what are the Robertsons’ religiously conservative fans going to make of the family breaking bread with Sin City?

“The Robertsons are so unusual, their story so juicy, and theater shouldn’t Continue reading →

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Showboat sold

Posted on November 12, 2014 by David McKee

For a long time, there’s been talk of Stockton College opening a satellite campus in Atlantic City. Many thought it would land at the Atlantic Club Hotel but, disposing of a non-core asset in a non-gaming transaction, Caesars Entertainment has sold the Showboat to Stockton College. The latter gains 28 acres and 1,425,000 square feet. But there’s still a lot of due diligence to be done and the sale price remains a mystery.

College President Herman Saatkamp could only say, “Our intent is Continue reading →

Posted in Atlantic City, Economy, Harrah's | 1 Comment

Quote of the Day

Posted on November 12, 2014 by David McKee

“We have always been incredibly grateful to our military community, and this partnership is another great example of our ongoing ‘Operation Thank You’ Flagcommitment to veterans.” — Station Casinos Chief Marketing Officer Staci Alonso, announcing that the company would be providing a wounded veteran with a home, in collaboration with Royal Purple Las Vegas Bowl and the Military Warriors Support Foundation. In related news, MGM Resorts International will be spending $250,000 to help build the nation’s 68th Fisher House. An extended-stay facility for military families, it will have 16 suites and be built on the site of the former VA Hospital in North Las Vegas.

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Tribal roundabout

Posted on November 12, 2014 by David McKee

Escalating the level of desperation in Connecticut, comes a proposal for the state’s two gaming tribes to gang-tackle Massachusetts by collaborating on a third casino of Sayerstheir own. So far, all of the noise seems to be coming from Mohegan Tribal Gaming Authority CEO Mitchell Etess. He’ll find sympathetic ears in Hartford — particularly Deputy House Speaker Peggy Sayers (D) — where “state revenue projections show the Connecticut casinos’ payments to the state will fall to $190.8 million in the 2017-18 fiscal year, just 44 percent of the $430.5 million they totaled at their peak in 2006-07.”

Etess is proposing something quick and cheap that would be along the axis between the capital city and the Bradley airport, interdicting business that might otherwise go to Springfield. The idea isn’t completely outside the box: Last year, lawmakers considered tribally run VLTs at three state parimutuels. However, a spokesman for newly reelected Continue reading →

Posted in California, Economy, Foxwoods, Internet gambling, Massachusetts, Mohegan Sun, Oklahoma, PokerStars, Taxes, Tribal | Comments Off on Tribal roundabout

Caesars, the morning after

Posted on November 12, 2014 by David McKee

It’s been a day since Bloomberg News broke the story that Caesars Entertainment is gearing up for a Jan. 14 bankruptcy filing, the day Gary Loveman promised would caesarscasino_1never come. (By filing on the 14th, Caesars avoids paying $225 million to second-lien bondholders.) Well, here it is and it looks like it will work out pretty well for first-lien bondholders. “The creditors have a lot of control here. If they can’t get first-lien creditors to go along, they have a real problem,” Columbia University Law School‘s Ronald Mann told Bloomberg. It appears that first-lien creditors will get 90 cents on the dollar, in a mix of cash, securities and ownership in Caesars Entertainment Operating Co., the unit seen as most vulnerable to a bankruptcy filing. Second-tier creditors will be lucky to get some cheap trinkets.

During the waning months, one of Caesars’ bragging points has been that it had plenty of cash in the larder. Well, it looks like those good days are behind it, with  Continue reading →

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Caesars: How do they do it?

Posted on November 11, 2014 by David McKee

This just in: Working with “key senior creditors,” Caesars Entertainment Operating Co. is reported to be arranging a prepackaged bankruptcy, with a target date of Jan. 14.

How does Gary Loveman keep his job? If he were a cat, he’d be onto his 10th or 11th life by now. I mean, it can’t be easy losing $908 million in 3Q14 in the casino business Loveman speaksor everybody else would be doing it. Loveman managed to turn a 6% increase in revenue into a 19% growth in losses, even though writedowns were $499 million not 3Q13’s $819 million. Interest expenses soared 26% and cash-flow problems are the elephant in the room. Little of the growth came from gambling or hotel rooms, each just up a tick or two, but food and beverage managed an impressive 7% increase. Caesars Entertainment also chose this moment to sneak out resort fee increases at six of its eight Strip hotels. That means an extra hidden impost of $25, regardless of which Las Vegas Strip Caesars property you patronize.

Loveman must not have received the memo that Caesars had just been clocked in Ohio, for he chose to whistle past the graveyard, saying,  Continue reading →

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Quote of the Day

Posted on November 11, 2014 by David McKee

Sweeney“Combined between schools and the municipal government in Atlantic City, it costs $377 million a year. That’s not sustainable.” — New Jersey Senate President Stephen Sweeney (D) proposing an austerity plan to stabilize Atlantic City’s finances, in advance of a a summit meeting next week with Gov. Chris Christie (R).

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Philadelphia decision tipped; Insolvency on the high seas

Posted on November 11, 2014 by David McKee

While we’ve been focused on Boston and New York, a major casino decision in Philadelphia has been creeping upon us. The second casino license in Philly city limits is Cordish Philadelphiato be awarded on Nov. 18 and early intel has it going to Cordish Gaming and Greenwood Gaming & Entertainment‘s proposed Live! Hotel & Casino (pictured). If so, Greenwood doubles down on the Philadelphia market, as it already owns one of the state’s premier casinos, Parx Casino, in suburban Bensalem. Cordish’s sensational performance with its Live-branded casino outside Baltimore may have been the decisive edge that aced out some native-son candidates and bedazzled with visions of tax dollars dancing in their heads.

nutterThe prospective also-rans include developer Bart Blatstein, who proposed to turn the old Philadelphia Inquirer building into a luxury hotel, The Provence. Then there was produce mogul Joseph “Tomato King” Procacci, whose amusement park-plus-casino concept never made much sense. Mayor Michael Nutter (left) may also be vexed because the Cordish/Greenwood project is earmarked for the southern part of the city, near its sports stadiums, while Nutter wanted something in the center of town.

Steve Wynn already walked out on the Philadelphia market, finding it overcrowded, and a number of lawmakers are expressing similar concerns. Continue reading →

Posted in Atlantic City, Cordish Co., Economy, Election, Florida, Geoff Freeman, Greenwood Racing, Maryland, Massachusetts, MGM Mirage, Minnesota, Neil Bluhm, Penn National, Pennsylvania, Problem gambling, Regulation, Steve Wynn, Technology, Tomato King Procacci, Tribal, Uncategorized | Comments Off on Philadelphia decision tipped; Insolvency on the high seas

Penn: The world according to GARP

Posted on November 11, 2014 by David McKee

Observing stability in regional gaming markets, Deutsche Bank‘s Carlo Santarelli is out with a bullish investor note on Penn National Gaming today, declaring “the Penn Plainville 2worst appears over.” He sets a $17 target price for the stock (currently trading just below $14), ascribing $4 of that value to Penn’s Plainridge project alone. “As such, with competitive headwinds largely behind them, for the first time in a long time, we see PENN as a compelling GARP [growth at a reasonable price] idea.”

Dismissing the REITmania surrounding Boyd Gaming and Pinnacle Entertainment, Santarelli forecasts that Penn will increase cash flow at a compound annual growth rate over the next two years of 11%, compared to 2% at Boyd and a slight contraction at Pinnacle. He predicts “the discount closes as investors get more comfortable with the … growth story.” He also noted “solid aggregate October results and continued strength at the recently opened Ohio tracks [and] a reasonable, though outside, shot at the soon-to-be-decided-upon [New York] license.”

* In the wake of this month’s election, expect to see a lot more stories like one I read yesterday in which Continue reading →

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Sheldon steps in it again and again

Posted on November 10, 2014 by David McKee

Sheldon Adelson‘s love of authoritarianism has made him another enemy. At the latest Israel American Conference, Adelson rhapsodized, “God talked about all the good Sheldon_Adelson dye jobthings in life. He didn’t talk about Israel remaining as a democratic state, otherwise Israel isn’t going to be a democratic state — so what?” Anti-Defamation League National Director Abe Foxman called Adelson’s dismissal of democratic values “disturbing,” adding, “the founders of Israel got it exactly right when they emphasized the country being both a Jewish and democratic state. Any initiatives that move Israel away from either value would ill-serve the state and people of Israel.”

It’s been that kind of season for Adelson, whose childish side emerged in a denunciation of Genting Group for daring to comp aggressively and extend too much credit. “Maybe one day, they will get used to competing on the basis of a quality product, if they ever build one, and they won’t have to buy the business,” he sniped petulantly. The problem? Continue reading →

Posted in Atlantic City, Economy, Genting, International, Internet gambling, Japan, Macau, Politics, Sheldon Adelson, Singapore, Tourism | 1 Comment

Brainless in Connecticut; Jobless in Las Vegas

Posted on November 10, 2014 by David McKee

Mohegan SunWhat do you do when your slot revenues are declining? Build more casinos, of course! That’s the idea Mohegan Sun is pushing in Connecticut, with the help of a few well-placed lawmakers. It’s a no-brainer … as in, you’d have to have no brain to think it’ll work. Foxwoods Resort Casino is staying on the sidelines for now, but Mohegan Sun’s concept appears to be build satellite casinos to capture Connecticut gamblers who might try to escape over the border to Massachusetts (or New York).

One interesting thing that has come of this is Mohegan Sun’s commitment that “We did not win the competition for a [Boston] license and so now we are ready to compete for the business of Connecticut gaming casino gaming enthusiasts.” If Beantown Mayor Martin “McCheese” Walsh gets the urge to sue Wynn Resorts in favor of Suffolk Downs, it could be a great deal more difficult now that he no longer has Mohegan Sun for a stalking horse.

* Rather than rushing to an expedient, day-after-the-election decision, Wisconsin Gov. Scott Walker (R) is going to take the matter of Continue reading →

Posted in Boyd Gaming, Cosmopolitan, Dining, Foxwoods, Genting, Hard Rock International, Massachusetts, MGM Mirage, Mohegan Sun, New York, Sam Nazarian, Station Casinos, Taxes, The Strip, Tribal, Wisconsin | Comments Off on Brainless in Connecticut; Jobless in Las Vegas

Ohio’s big haul; NY Times’ whack job

Posted on November 10, 2014 by David McKee

Ohio has matured rapidly as a casino market, bigger than Illinois, almost as large as Missouri but still a long way from Indiana‘s monthly grosses. Still, a 38% increase in Cincy casino extcasino revenue from last year is nothing at which to sneeze. But with two more racinos in operation comes the word “cannibalization,” as gaming winnings were down 9% on a same-store basis. Caesars Entertainment (-19%) had a particularly tough time of it, while Penn National Gaming rose a boffo 48.5%. Hollywood Toledo (+4%) did a most impressive $198/day/slot while Hollywood Columbus, down 1.5% from last year, sequentially improved its numbers to $165/slot/day, although it seems to have lost business to Scioto Downs, up 3%. Tables fared better in Columbus ($1,640/table/day) than in Toledo ($1,116/table/day).

Penn’s VLT revenues are off the charts at its Continue reading →

Posted in Hard Rock International, Harrah's, IGT, Mohegan Sun, MTR Gaming, New York, Ohio, Penn National, Pennsylvania, Racinos, Sheldon Adelson | Comments Off on Ohio’s big haul; NY Times’ whack job