Big win for Wynn; Murren in the spotlight; Lies, damned lies and Sheldon Adelson

In a disappointing but entirely predictable result, the Nevada Supreme Court ruled that Nevada law permits employers to confiscate and redistribute tips received by employees (euphemistically referred to as “tip sharing”). Now, if a I stuck a gun in your face and took all your money, is that “income sharing,” even if I gave some of it back? The Supremes placed their stamp of approval upon Labor Commissioner Michael Tancheck‘s specious reasoning that, since Wynn Resorts confiscated the money but didn’t keep it, that was A-OK. However, since the redistributed tips were used in lieu of giving pit bosses a pay raise, one can argue that the money was indeed “kept” and put to a different use.

Anyway, the bulk of this endless litigation has been remanded to district court for resolution of two other aspects of the suit. The salient issue is Continue reading

Posted in Atlantic City, Boyd Gaming, Election, Florida, Harrah's, Marketing, Massachusetts, MGM Mirage, New York, Palms, Pennsylvania, Revel, Sheldon Adelson, Sports, Steve Wynn, The Mob, Tourism | 3 Comments

Quote of the Day

jimmurren_t652“Obviously, there’s been an awful lot of activity and drama there. But we like the process, it’s been very transparent to us, and we believe there’s no reason why we will not be found suitable.” — MGM Resorts International CEO James Murren, on the Massachusetts regulatory regimen, during today’s analyst call.

Posted in Massachusetts, MGM Mirage, Regulation | Comments Off on Quote of the Day

Falling upward in Nevada; MGM: The Lion meows

Helped by a wee bit of late-August slot revenue, Nevada posted a 7% revenue gain this month, for a $959 haul. The Strip performed spectacularly, up 13%, and Downtown edged 2% higher. Lake Tahoe vaulted 23% but Reno fell off 2%. Nor did Laughlin (-5%) or Mesquite (-2% and with 100% less Randy Black) fare especially well. On the Las Vegas Strip, baccarat win rose 49%, with the house playing very lucky, as baccarat drop was but 8% higher. Warned casino analyst Steven Wieczynski, “The positive baccarat volume performance was offset by generally underwhelming slot volumes.” Blackjack also provided a $29 million boost and $337 million was bet on Continue reading

Posted in Boulder Strip, CityCenter, Current, Downtown, Lake Tahoe, Laughlin, Macau, Mesquite, MGM Mirage, North Las Vegas, Reno, Sheldon Adelson, The Strip, Tourism, Transportation, Wall Street | Comments Off on Falling upward in Nevada; MGM: The Lion meows

Good news, bad news for Suffolk Downs; Wynn shaken down

suffolk downsCongratulations, Suffolk Downs. You’ve been approved as a casino bidder — but the voters might nix the whole shebang. Although Suffolk Downs is bereft of an operator, having given Caesars Entertainment the heave-ho. (The latter remains in deep water, financially, making noises about bankruptcy.) The Massachusetts Gaming Commission says that Suffolk can keep looking for a replacement, even as a Nov. 5 referendum looms. The MGC chided Suffolk Downs for its naivete regarding Caesars and it’s a point well taken. How far does one’s head have to be in the sand to have missed the Terrance Watanabe scandal, for instance? It cost Caesars a $225K fine in Atlantic City, after all.

Leaving that aside for a moment, whoever teams with Suffolk — be it Hard Rock International or Rush Street Gamingwill have to abide by the compact that Suffolk crafted in tandem with Caesars. They’ll have to render like Caesar, you might say.

Unfortunately for Suffolk, all this moving and shifting may be moot: A WBUR-FM poll, shows voters Continue reading

Posted in Foxwoods, Hard Rock International, Harrah's, Horseracing, Internet gambling, Massachusetts, Mohegan Sun, Neil Bluhm, Oklahoma, Problem gambling, Regulation, Sheldon Adelson, Steve Wynn, Tribal | Comments Off on Good news, bad news for Suffolk Downs; Wynn shaken down

Breaking Boyd

Boyd Gaming missed Wall Street expectations last quarter, posting negative earnings of eight cents a share, compared to the $0.01/share samstown-pic2profit the Street was anticipating. Deutsche Bank‘s Carlo Santarelli blamed “softer-than-expected net revenues … below the low-end of management’s guidance.” Las Vegas-area cash flow was up almost 9% and revenue +1% but offset by higher operating expenses. “Given we believe a key component of the bull case story of the stock has been a LV Locals recovery buoyed by operational efficiency improvements, we believe today’s results will cause many to revisit this thesis,” wrote Santarelli. Borgata cash flow exceeded management’s guidance, but Midwest and Southern properties took a 14% plunge.

The Peninsula Gaming-derived properties also undershot expectations. Joseph Greff of J.P. Morgan said the results “aren’t Continue reading

Posted in Atlantic City, Boulder Strip, Boyd Gaming, Current, Downtown, Environment, Greenwood Racing, history, Iowa, Louisiana, Maryland, MGM Mirage, Ohio, Penn National, Wall Street | Comments Off on Breaking Boyd

Let us now praise Scott Walker

For someone often regarded as brash and confrontational, Wisconsin scott-walker1Gov. Scott Walker (R) has been mediating an intrastate tribal dispute in a judicious, deliberative fashion. He’s extended the timeline on his yea-or-nay decision, the better to sort through varying figures (including some fuzzy math) submitted by the tribes in dispute. The Menominee Tribe wants to invest $808 million to create a racino at Kenosha‘s Dairyland Greyhound Park. Gargantuan Potowatomi Bingo in Milwaukee says that would cost it $158 million in lost revenue in Year One alone. The Ho-Chunk Nation would lose a smaller chunk of revenue: $19.5 million over the same time period.

(The Menominee would partner with Hard Rock International and the design rendering looks suspiciously like it was hastily repurposed from Hard Rock’s rejected Massachusetts casino.)

The Menominee estimate the Milwaukee losses, in a report filed with Walker’s office, to be about $62.6 million over four years while suggesting no Ho-Chunk losses,” reports the Milwaukee Business Journal. Walker is skeptical that a comparable threat would emerge from Continue reading

Posted in Dining, Economy, Illinois, The Strip, Tribal, Wisconsin | Comments Off on Let us now praise Scott Walker

Case Bets: New York, Wynn, Packer, Atlantic City & Reno

In a positive omen for Tuesday’s casino vote in New York, shares of Castkills-based Empire Resorts (NYNY) leapt 29%, closing at $5.30/share. The company hopes to bring casino gambling to the Concord Hotel, although jostling for the probable two Catskills resorts is expected to be fierce. Even rival developer Louis Cappelli is hedging his bet, holding onto a million shares of Empire, which is majority owned by Kien Huat Realty III Limited, a Malaysian company … better known to some as Genting Group.

Steve Wynn won a round with Kazuo Okada when Continue reading

Posted in Atlantic City, California, Current, Genting, Harrah's, Illinois, International, James Packer, Melco Crown Entertainment, New York, Reno, Slot routes, Station Casinos, Steve Wynn, Tribal | 4 Comments

Quote of the Day

Loveman fluffy“After we received a report from the [Massachusetts] Gaming Commission staff that said we had not demonstrated Caesars’ suitability, our parents in the project — our parents, that’s some deep psychological issue, I suppose — our partners in the project asked us to withdraw, and we agreed.” — Caesars Entertainment CEO/Chairman/President Gary Loveman, during yesterday’s 3Q13 earnings call.

Posted in Harrah's | Comments Off on Quote of the Day

Loveman must go

Suffolk Downs executives are trying to move on after severing ties with Caesars Entertainment. At their suitability hearing with the Massachusetts Gaming Commission (which is expected to approve them), they played dumb. They not only pleaded ignorance of Arik Kislin‘s dubious business ties, they claimed ignorance of the Terrance K. Watanabe scandal. The latter not only made national headlines, it earned Caesars a $225,000 fine in New Jersey, even though the events in question took place on the Strip.

suffolk-downs-casino-thumb-520x301-92384jpg-7517a160501587b8Suffolk Downs is also sticking to revenue projections of $1 billion/year, of which Boston mayoral candidate Bill Walczak scoffingly said, “This casino will have to clear more revenue than any casino in the Western Hemisphere.” Be that as it may, voters will almost certainly have to vote on Suffolk Downs without knowing who will be running its casino. Whomever it turns out to be will be bound to Continue reading

Posted in Colorado, Maryland, Massachusetts, Regulation, The Mob | 1 Comment

Fail, Caesar!

IMG-20130507-00006In ancient Rome, if you’d lost the equivalent of three-quarters of a billion dollars (worse: $761 million and change, plus flat revenues), you’d swig some hemlock, open a vein or maybe fall on your sword. But the only thing more alien to Caesars Entertainment than atonement is accountability. So CEO/President/Chairman Gary Loveman proclaimed, “We made considerable progress on the execution of our strategy and achieved key milestones on many projects during the quarter despite continued softness in the domestic gaming business.” You’d think Caesars had improved business when its losses actually widened from a trifling half-billion dollars a year ago.

On the Las Vegas Strip, Caesars really did do better (up 5%), but many of its gains were already cannibalized by Continue reading

Posted in Atlantic City, Current, Harrah's, Macau | Comments Off on Fail, Caesar!

Third degree for Cantor; Suffolk moves ahead

Cantor Gaming finds itself in the midst of a giant pincer movement, under investigation by at least five federal agencies and the Nevada Gaming Control Board. When ex-bookie-in-chief Colbert got a slap on the wrist from the feds, I figured he was singing like a canary and, sure enough, he’s giving a stool pigeon serenade, according to the Wall Street Journal. The federal action appears to be part of a rolling crackdown on money laundering on the Las Vegas Strip. (Don’t forget that Cantor affiliate Las Vegas Sands settled with the G-Men for a relatively modest fine and was praised for its cooperation, to boot.)

Cantor’s attitude is not unlike that of the Warren Commission: Colbert acted alone. But there’s always been a filmy coating of sleaze surrounding Cantor, which got into Nevada action via a self-penned bill that got through the Lege without sponsorship. The conception of Cantor may have been immaculate but its cleanliness is very much in doubt these days.

We’ve had a Neil Bluhm sighting at Suffolk Downs, meaning that Rush Street Gaming is in the hunt to supplant Caesars Entertainment as the neil-bluhmracino’s operator (if Suffolk gets the nod from the Massachusetts Gaming Commission). Emissaries from Hard Rock International have also been seen at the track. But whereas Rush Street is fully vetted and approved, Hard Rock would have to resume the approval process that was so rudely interrupted by West Springfield‘s rejection of the casino company.

It’s not believed that the Downs itself will have any trouble getting licensed, with Gary Loveman out of the picture, which Continue reading

Posted in Cantor Gaming, Economy, Hard Rock International, Harrah's, Macau, Massachusetts, Neil Bluhm, Regulation, Sheldon Adelson, Steve Wynn | Comments Off on Third degree for Cantor; Suffolk moves ahead

Positive auguries in New York

Seal_of_New_York.svgSupporters of more casinos in New York State have been a little anxious about sentiment in New York City, where the fate of the constitutional amendment is expected to rest. They may be breathing a sigh of relief today after a New York Times poll showed that 60% of Gotham voters favored the measure. It was helped by a considerable NIMBY factor: When asked if they wanted a casino in the Five Boroughs, support fell to 50%. And only 13% considered themselves “very likely” to visit one of the upstate casinos. Support for Proposal One was thought to be softest in New York City (and the Times had editorialized against it), but this poll makes the well-funded campaign look like an Election Day shoo-in.

Those with a sentimental attachment to the Borscht Belt — such as New York Gov. Andrew Cuomo (D) — should be pleased, as that’s one of the areas targeted for casino-fueled renewal.Two of the would-be players are Continue reading

Posted in Dining, Downtown, Economy, Election, Foxwoods, Macau, Mohegan Sun, New York, Sheldon Adelson, Tamares Group | Comments Off on Positive auguries in New York

MGM’s, Wynn’s odds worsen in Massachusetts

MACAU-HO/

Did anyone envision a scenario whereby all three of Massachusetts‘ casinos could be tribally owned? It could happen. Leaving aside the chance of expanded gambling in Connecticut, the prospect that MGM Resorts International will be weighed in the balance and found wanting now seems very real. I could make the case for why MGM deserves a second chance (and have done so vis-a-vis New Jersey) but Pansy Ho is still a minority shareholder in MGM Grand Paradise and isn’t going anywhere anytime soon. That alone could sink MGM’s chances, never mind how MGM got into the Macanese market. Neither it nor Wynn Resorts is going to give up Macao for Massachusetts, although the metaphorical dossier against either company is slimmer than that against Caesars Entertainment was.

Bay State regulators’ goal is to have scrutiny “more rigorous at every level than any other jurisdiction in the United States,” according to Massachusetts Gaming Commission Chairman Stephen Crosby, challenging the regulatory cojones of Nevada and New Jersey. Now, while it is sadly unrealistic to expect driven-snow purity in the business world, it’s a vexing question at just how much misbehavior one should wink. (Asked Crosby, “What if the laws in Macao permit things the laws in Massachusetts would not permit?“)

Wynn Resorts would seem to have the least — some squabbles with Kazuo Okada excepted — to fear. Yet Steve Wynn has already publicly bridled at the scrutiny and gotten Crosby’s back up: “The law makes it clear the burden is their burden to prove that they are suitable. That’s the world Steve Wynn lives in. He is going to have to comply with our standards and he is entitled to his own opinions about what we are doing.”

By comparison, Mohegan Sun‘s biggest issues are traffic volume and water usage. Neither Crosby nor his fellows on the MGC are supposed to Mohegan Palmer 2have a dog in the fight. However, if MGM is disallowed, the commission could always choose Cordish Gaming‘s Leominster slot parlor — on the grounds that it will yield the greatest tax benefit, as appears will be the case — opening the door for Penn National to resume its courtship of Springfield, then choose between it and the Mohegans in April. The southeast region, meanwhile, has yet to draw a marquee-name developer. There are certain to be jilted suitors in Massachusetts, but I see no reason that state-approved players like Penn, Mohegan, Cordish and Greenwood Racing should be left on the outside looking in.

Although MGM and Foxwoods are not directly competing in Massachusetts, the MGM moniker is coming off Foxwoods Resorts Casino. CEO Scott “Woody” Butera had to go out and spin this as a positive development. Uh huh.

I don’t know if Caesars’ Britney Spears production show will be a success. But it’s certain to drive off Planet Hollywood‘s vast Somali player base.

Posted in Cordish Co., Entertainment, Foxwoods, Greenwood Racing, Harrah's, Macau, Massachusetts, MGM Mirage, Mohegan Sun, Pansy Ho, Penn National, Regulation, Steve Wynn, The Strip, Tourism, Tribal | Comments Off on MGM’s, Wynn’s odds worsen in Massachusetts

Isle gets some love; Second chance in New York

A great pick.” That’s what Seeking Alpha says about Isle of Capri Casinos. Like so many regional operators, it hasn’t been posting lights-out islelogonumbers lately but its 16-casino portfolio makes it a bargain play for some. “It’s hard not to love the simplicity of the business mode,” writes Seeking Alpha, noting that the stock has been “essentially flat” after a steep plunge in 2011. Heavily invested in riverboats, Isle is especially vulnerable to seasonal disruptions from flood waters. A combination of heavy promotional allowances in a weak economy are also blamed for Isle’s lack of Wall Street curb appeal.

Profit margins at Isle Cape Girardeau, though, are on a two-quarter growth spurt and Lady Luck Nemacolin is well positioned between the Pittsburgh and Morgantown markets. Seeking Alpha deems Isle’s debt Continue reading

Posted in Election, history, Isle of Capri, Missouri, New York, Pennsylvania, Reno, Tribal, Wall Street | Comments Off on Isle gets some love; Second chance in New York

Boyd gets ‘F’ on report; Disney’s double gamble

“Boyd is a highly leveraged casino play that has no exposure to high growth Asian markets.” With those words, Seeking Alpha concludes a severe assessment of Boyd Gaming, an investment upon which it frowns, boyd-gaming-200despite being at a five-year high. Wall Street is not fond of Boyd and Seeking Alpha‘s analysis makes it clear why. It cites 1) “its high level of indebtedness,” which leaves it vulnerable to economic adversity; 2) a 13:1 debt-to-equity ratio*; 3) “interest payments [that] have more than consumed operating income”; 4) a 2018 “maturity wall” on its debt; 5) a “simply ugly” balance sheet, “forcing it to operate solely to pay back creditors”; 6) forward trading that is too far out of alignment with the company’s rate of growth (58% vs. 2%); 7) “Online gaming continues to be an area of high potential that has been slow to materialize.”

New Jersey sports betting is, best-case scenario, two years away. And Boyd’s devaluation of Borgata to $880 million is described as Continue reading

Posted in Atlantic City, Boyd Gaming, Economy, Florida, New York | Comments Off on Boyd gets ‘F’ on report; Disney’s double gamble

Quote of the Day

Wynn_BG1“They’ve got a piece of property that they can’t use. Massachusetts has got a piece of property that’s dirty and they can’t use. I’m the damn fool that wants to come and spend a billion and two or three hundred million dollars, paying the state money, giving jobs to people in town. Whose career is dependent on what is a mystery to me. All I know is I work for this company and I only give a damn about this company.” — Steve Wynn, on his obligations — or lack thereof — to Everett.

Posted in Economy, Massachusetts, Steve Wynn | Comments Off on Quote of the Day

The importance of being Steve Wynn; Sheldon’s fan club

steve-wynn“Even the Red Sox aren’t that popular in Everett,” says Steve Wynn, alluding to recent poll numbers. Heady stuff. So, while he comes down off Cloud Nine, let’s look at a pretty impressive 3Q13 — if not as boffo as Las Vegas Sands‘ — for Wynn Resorts. Revenue from Macao rose 10%, while the Las Vegas Strip resorts eked out a 1% increase. Wynn had an interesting explanation for the latter phenomenon. Competition for DJ talent is stiff, he said, driving up the price of talent (J.P. Morgan analyst Joe Greff pointed the finger of blame at Hakkasan). I wonder if that’s the first time high-priced DJs have ever factored in a Wall Street conference call.

Wrote Deutsche Bank‘s Carlo Santarelli, ” we think the results were modestly better than expected, though no true surprise,” adding that the door was still open for a year-end dividend. Still, he liked what he saw enough to Continue reading

Posted in Economy, Entertainment, Hard Rock International, Macau, Massachusetts, Pennsylvania, Regulation, Sheldon Adelson, Steve Wynn, The Strip, Wall Street | 2 Comments

Quote of the Day

“[B]asically these states are asking us to come and spend billions of dollars. Now if we were any other business, they would stand on their head and spit steve-wynn-1wooden nickels to get billions of dollars invested from any other business. But we find ourselves being treated in many respects as if they’re doing us a favor. … If I was any other businesses and I was willing to spend the kind of money, create the kind of jobs that these states have requested, we would have the red carpet rolled out for us and the governor and everybody else would be delighted to talk to us. But if you are in the gaming business, there’s sort of a crummy presumption that you might be unsavory. And that burns me up, I tell you the truth … Being an investor in America today is tough.” — Steve Wynn, railing against East Coast regulators in his latest conference call.

Posted in Massachusetts, Pennsylvania, Regulation, Steve Wynn | Comments Off on Quote of the Day

New casino in Alabama; Potential new scrutiny for Caesars; Second thoughts for Walker?

Alabama Attorney General Luther Strange is throttling the life out of the Cotton State’s electronic bingo industry. But, thanks to tribal sovereignty, the Poarch Band of Creek Indians has been able to this to its advantage. When Wind Creek Wetumpka Casino & Hotel opens, the tribe will have 6,620 VLTs scattered across three facilities (one of which will be retired eventually), over a third of them in its impressive-sounding new casino, which comes complete with a shark tank. (Default on that marker at your own peril!) Meanwhile, Strange hasn’t given up on trying to put the Creek out of business. He’s pursuing a lawsuit that was moved to federal court, a venue traditionally sympathetic to tribal interests.

As unlikely as it would have seemed a week ago, Caesars Lovemans big diceEntertainment‘s precipitate withdrawal from Massachusetts is setting off a muted domino effect. While Baltimore Mayor Stephanie Rawlings-Blake still has full confidence in the company’s ability to finish and open Horseshoe Baltimore, the Boston debacle and a Treasury Department investigation could complicate matters. “We are gathering information and will give these matters the attention they deserve,” ominously stated the Maryland Gaming Control Agency. At least Gary Loveman (pictured) can say he’s got the biggest pair of dice in town. (Suffolk Downs, meanwhile, is moving forward as though it had never heard of Caesars.)

Perhaps the Menominee Tribe made its case after all. Today was the date appointed for Gov. Scott Walker (R) to rule on the tribe’s casino application. But Walker Continue reading

Posted in Alabama, Current, Harrah's, Maryland, Massachusetts, Regulation, Tribal, Wisconsin | Comments Off on New casino in Alabama; Potential new scrutiny for Caesars; Second thoughts for Walker?

War of words in N.Y.; Double standard in Illinois

After keeping a low profile for most of election season, pro-casino forces sprang into gear, rolling out a bevy of TV ads. In an attempt to neutral Lhotapotential hostility downstate, one commercial points out that New York City‘s two mayor candidates, Bill de Blasio (D) and Joe Lhota (R, left) both favor gambling expansion. Gov. Andrew Cuomo (D) continues to distance himself from the campaign, “taking an extremely quiet stance,” as the Buffalo News puts it. When confronted on it, he said, “You can’t be any more linked to it than I am.” Good on you, guv, but it would be better if you didn’t have to be practically coerced into giving public statements of support. But, as he said, “This is about television commercials. This is about direct mailings, and that’s how this campaign is going to be run and won or lost.” Opponents are financially outgunned by are hitting back hard with anecdotal evidence of rampant pathological gambling and overstated economic benefits.

And in the newspaper pages. That gray eminence, The New York Times, weighed in this week with a predictably anti-casino editorial. Its arguments were so rote that the author could have penned them in his sleep. Legalized casinos are bad economic policy was the editorial’s case, using Continue reading

Posted in Atlantic City, Current, Detroit, Economy, Election, Illinois, New York, Politics, Problem gambling, Regulation, Slot routes, Taxes | Comments Off on War of words in N.Y.; Double standard in Illinois