{"id":30046,"date":"2021-09-13T09:50:32","date_gmt":"2021-09-13T17:50:32","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=30046"},"modified":"2021-09-22T08:05:26","modified_gmt":"2021-09-22T16:05:26","slug":"balmy-august-in-indiana-the-coming-crisis-in-vegas-mgm-talks-up-prospects","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/balmy-august-in-indiana-the-coming-crisis-in-vegas-mgm-talks-up-prospects\/","title":{"rendered":"Balmy August in Indiana; The coming crisis in Vegas; MGM talks up prospects"},"content":{"rendered":"\n
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There are signs that the regional gaming recovery is cooling (Missouri<\/strong> was up just 1% last month) but Indiana<\/strong>‘s August numbers, while not as hot as July’s, were a balmy 10% higher than 2019 as casinos grossed $203 million. Horseshoe Hammond<\/strong> lost a percentage point but retained the top spot with $33 million. Closing fast is Hard Rock Gary<\/strong>, with $30 million, while Ameristar East Chicago<\/strong> gained 9% to hit $21 million. Blue Chip<\/strong>, off to the east, sagged 11% to $12 million. Further to the south, Boyd Gaming<\/strong> saw even greater misfortune at Belterra Resort<\/strong>, plummeting 29% to $7 million. Also hard-hit was French Lick Resort<\/strong>, falling 26% to $6.5 million. Other revenue-negative performers were Rising Star<\/strong>, minus 6% to $4 million and Hollywood Lawrenceburg<\/strong>, down 11% to $14 million. In its last month as a Caesars Entertainment<\/strong> property, Caesars Southern Indiana<\/strong> was up 5.5% to $19 million, while Indiana Grand<\/strong> jumped 13% to $24 million and Harrah’s Hoosier Downs<\/strong> grew 12% to approach $19 million. Bally’s Corp<\/strong>. had a good first month at Tropicana Evansville<\/strong>, up 5% to $13.5 million.<\/p>\n\n\n\n

As for sports betting, $215.5 million in handle boiled down to $17 million in revenue. FanDuel<\/strong> garnered $5 million and 30% market share against DraftKings<\/strong>‘ $4.5 million and 26% share. BetMGM<\/strong> was third with $2.5 million and 15%. Also in the game were William Hill<\/strong> ($2 million\/11%) and Barstool Sports<\/strong> ($1 million\/7%). In terms of getting the most bang per handle, FanDuel (25% of handle) skunked DraftKings (34%). Barstool also maximized its share of handle, which was 4%. William Hill had 13% and BetMGM 12%.<\/p>\n\n\n\n\n\n\n\n

Wall Street<\/strong> analysts who think that the good times are not only here again in Las Vegas<\/strong> but will never end should be required to read Politico<\/em>‘s thorough and deep dive into Sin City in the time of pandemic. It depicts (better than we ever could) a tourist town that’s caught between myriad rocks and hard places. It’s trying like hell to return to normality but that damned Coronavirus<\/strong> keeps rearing its ugly head<\/a>. The situation is made worse by politicians playing games with the virus to serve their own ends. Worst of the worst is Las Vegas Mayor Carolyn Goodman<\/strong> who, by her own words, is either ignorant and helpless or simply pretending to be for fear of having to take a stand. We’d call that a profile in cowardice. She can afford to whistle past the graveyard. Downtown<\/strong> casinos were the only major jurisdiction to see higher foot traffic<\/a> last month, up 10%. As for Wall Street’s glee at record levels of cash flow being thrown off by Big Gaming, remember this: It’s made possible by Covid-motivated cost cutting that has not abated with the return of business (and the stock pickers know this). As Bob Potts<\/strong> of the Governor’s Office for Economic Development<\/strong> soberly predicts, 50,000 hospitality-jobs may never return. Don’t like “Less Vegas”? Get used to it.<\/p>\n\n\n\n

On a happier (for casinos) note, room rates are getting a shot in the arm from Global Gaming Expo<\/strong>. Prices for the Oct. 3-9 period are up 33% from 2019. Midweek ADRs are boosted 28% and weekend rates are 39% higher. Venelazzo<\/strong> (where we’ll be bivouacked) is 38% up midweek and 59% on the weekend. But it’s Wynncore<\/strong> that’s hitting the jackpot, vaulting 70% during G2E and 47% on the midweek. MGM Resorts International<\/strong> properties are just 28% higher on weekdays and 24% on the weekend, while Caesars Entertainment ones are 27% more midweek but 46% greater on the weekend. Speaking of MGM, CFO Jonathan Halkyard<\/strong> admitted that the convention comeback assumed for late 2021 isn’t really happening<\/a> but assured Wall Street that 2022 would be better in that respect. \u201cWe have seen cancellations and others have as well, but at the same time, we\u2019re seeing a near-record lead generation as it relates to group business for 2022,\u201d\u00a0said Halkyard, who added that leisure travelers were taking up much of the convention slack.<\/p>\n\n\n\n

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As for recent levels of play on the Las Vegas Strip<\/strong> (including newfound slot enthusiasm among younger players), the CFO continued, \u201cMy own view is that it does not represent a long-term change in behavior … there hasn\u2019t been as much entertainment or nightclubs. I\u2019m in the camp that believes some of these behaviors will return to more normalized levels over time. It has been great for operators, because these revenues come at high margins.\u201d As for F&B and entertainment, they’re lagging 2019 levels by as much as 30%. \u201cOur view as things normalize is that earnings will grow, because we don\u2019t yet have what we consider to be an optimal customer mix for profitability for MGM,\u201d\u00a0confided Halkyard. <\/p>\n\n\n\n

Even more interestingly, Halkyard effectively took MGM out of the running for purchase of The Cosmopolitan of Las Vegas<\/strong>. He said the company’s recent, $6 billion haul from property sales would go into three things: 1) room renovations that include upgraded digital technology; 2) funding BetMGM, which is playing a hot hand these days and 3) share repurchases. MGM’s still hung-ho on Japan<\/strong> but plans to underwrite that from free cash flow. He waxed enthusiastic on BetMGM and stressed the importance of first-mover status, and said New York State<\/strong> and California<\/strong> were priorities (albeit prudently refraining from saying which of three California ballot questions he favored).<\/p>\n\n\n\n

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Trying to turn the page on Hurricane Ida<\/strong>, marketers at Caesars are digging deeply into their databases\u2014and way outside the Gulf Coast market. The above offer was received by a player in Philadelphia<\/strong>, one who’d relinquished their Diamond-level status six years<\/em> ago. While it risks cannibalizing Pennsylvania<\/strong> business, if it’s a harbinger of a bargain-oriented era at Caesars we’re all for it. Meanwhile, back at Caesars HQ, management was so thrilled<\/a> with its July and August numbers it released them early. \u201cWe continue to see CZR as well positioned across the board for a leisure-based Strip recovery,\u201d wrote Truist Securities<\/strong> analyst Barry Jonas<\/strong>, adding that regional casinos were buttressed against any \u201creasonable COVID resurgence.\u201d That’s reassuring.<\/p>\n\n\n\n

Jottings<\/em><\/strong>: On the heels of\u2014shall we say?\u2014disappointing returns in Macao<\/strong>, an unsecured notes offering is being floated by Sands China<\/strong>. The initiative got a gloomy BBB- outlook<\/a> from Fitch Ratings<\/strong>, given that Macanese gaming revenues are only 35% of what they were in 2019 and not expected to reach former heights for three years hence … Peninsula Pacific<\/strong> got Louisiana<\/strong> regulators’ approval to move a Shreveport<\/strong> riverboat to Slidell<\/strong>. If only it were that easy. Gambling isn’t legal in Slidell yet and a citizens’ vote isn’t even scheduled<\/a> at this point. Also, P2E’s revenue projections ($153 million) look, well, optimistic … Putting a cuddly face on Resorts World Las Vegas<\/strong> are Stardust<\/strong>, Sinatra<\/strong> and Elvis<\/strong>, robotic puppies who greet guests in the lobby<\/a>. \u201cAs we continue to explore a variety of tech-forward offerings for the property, we were excited to learn about this advanced AI technology and knew it would be a fun added touch for our guests,\u201d property President Scott Sibella<\/strong> told the Las Vegas Sun<\/em>. You can’t put a price tag on that kind of entertainment … Covid-19<\/strong> has a silver lining for the Philippines<\/strong>: Record gambling revenues of $761 million, driven by online play<\/a>. According to PAGCOR Chairwoman Andrea Domingo<\/strong>, most of the action is coming from overseas … Another tribal\/private alliance has been struck in Arizona<\/strong> sports betting: Fubo Sportsbook<\/strong> will partner with the Ak-Chin Indian Community<\/strong> to be its service provider. The peripatetic Scott “Woody” Butera<\/strong> has popped up in the middle<\/a> of the deal as Fubo Gaming<\/strong> president. He goes where the action is … The U.S. Travel Association<\/strong> is caught between urging Americans to vacation<\/a>, dammit, and supporting a strong public-health regimen. “After Labor Day, we are very concerned about what travel is going to look like for the final quarter of the year. For most people, there are lots of cancellations happening right now,” fretted Chip Rogers<\/strong>, CEO of the American Hotel & Lodging Association<\/strong>. Added travel agency founder Melissa Biggs Bradley<\/strong>, “People have held out for this idea that we’ll get vaccinated and the world will be exactly like it used to be. Everyone in the travel industry realizes this is a long-term thing and everything is a lot more complicated and will remain more complicated.”<\/p>\n\n\n\n

Quote of the Day<\/strong>: \u201cStatistics are proving those who are vaccinated are less likely to wind up in the hospital or die due to Covid. Vaccines are a good thing and save lives, but I still believe that the government should be mandating things like this for public-owned property only and lead by example. The private sector should be left to decide for themselves, which you are seeing large responsible companies do already.\u201d<\/em>\u2014restaurateur Michael Sinensky<\/strong> <\/p>\n","protected":false},"excerpt":{"rendered":"

There are signs that the regional gaming recovery is cooling (Missouri was up just 1% last month) but Indiana‘s August numbers, while not as hot as July’s, were a balmy 10% higher than 2019 as casinos grossed $203 million. Horseshoe … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[109,293,291,60,244,34,274,66,51,277,14,278,198,104,165,283,68,37,171,241,84,62,53,245,35,39,101,301,69,95,192,33,25,279,243,8,19,20,38,252,233],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/30046"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=30046"}],"version-history":[{"count":3,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/30046\/revisions"}],"predecessor-version":[{"id":30056,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/30046\/revisions\/30056"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=30046"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=30046"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=30046"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}