A calendar shift that moved the lucrative Chinese New Year holiday into February sent Nevada gaming revenues soaring, contributing to the largest single-month total ever for the Strip.
Nevada casinos collected $1.073 billion in gaming revenues during February, a 15.1 percent increase compared with the same month a year ago according to figures released Wednesday by the Gaming Control Board.
The statewide gaming revenue total was the highest monthly amount produced by Nevada casinos since December 2007.
On the Strip, gaming revenues hit a record $696.1 million, a 31.2 percent increase.
“While February saw the timing benefit of a strong Chinese New Year, we think results still came in ahead of expectations,” Macquarie Securities gaming analyst Chard Beynon told investors.
The record figures were the result of high-end baccarat play associated with the 10-day Chinese New Year holiday. In 2012, the Chinese New Year was in January. In 2013, the holiday fell into February. As a result, gaming revenues in January declined 12.4 percent statewide and 18.7 percent on the Strip.
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Las Vegas, we didn’t quite make it to 40 million visitors in 2012, but we came close. When all was said and done, 39.7 million people came to the city in 2012, up 2.1 percent from 2011’s final total of 38.9 million visitors, according to the monthly Las Vegas Convention and Visitors Authority count released Friday. And even though it’s not quite 40 million, 2012 still was a record year for Las Vegas – the previous high was 39.2 million visitors in 2007.
“I’m happy that we had 500,000 visitors over our previous record,” said Kevin Bagger, the authority’s senior director of marketing.
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Nevada’s casino industry posted its third straight annual gaming revenue increase in 2012 as the industry continues its modest recovery amid a sluggish economy.
Analysts noted the results were helped by high-end baccarat play, the game that has bolstered the industry’s bottom line since Las Vegas companies began doing business in Macau in 2004.
Statewide, casinos collected $10.86 billion in gaming revenue in 2012, a 1.5 percent increase over $10.7 billion in 2011.
“We are slowly increasing revenues,” said Michael Lawton, senior research analyst for the Nevada Gaming Control Board. “We are still 15.5 percent below the peak in 2007, but we are gradually moving in the right direction.”
Nevada gaming revenues were $12.8 billion in 2007, Lawton said. On the Strip, gaming revenues increased 2.3 percent over 2011 with casinos collecting $6.2 billion, marking a second straight year revenues topped $6 billion.
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When does a net loss of more than $1.21 billion not seem so bad?
When it’s compared with a net loss of almost $4 billion in the previous year.
Nevada’s casino industry suffered through its fourth straight fiscal year net loss despite 4.4 percent growth in total revenues over the 12-month period, according to the annual Gaming Abstract, which the Nevada Gaming Control Board released Wednesday.
The report compares revenues and income produced by casinos generating more than $1 million in gaming revenues during the fiscal year, which ended June 30.
In 2012, the abstract included results from 265 casinos statewide. Together, the casinos had a net loss of $1.21 billion on total revenues of more than $22.9 billion. In fiscal 2011, 256 casinos generated a net loss of almost $4 billion on revenues of $22 billion.
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Nevada gaming regulators want to discipline the owner of a Las Vegas bar where state and local agents claimed to have witnessed customers performing sex acts in view of other customers, according to a nine-count complaint.
The state Gaming Control Board on Thursday filed the complaint against Judy R. Nelson, owner of the Las Vegas Eagle, a bar with a restricted gaming license allowing slot machines at 3430 E. Tropicana Ave and Pecos Road.
The complaint filed with the Nevada Gaming Commission said since July 2011 the board has received numerous complaints about inappropriate activity at the Las Vegas Eagle and agents found on Craigslist “sexually suggestive postings” for the bar featuring pictures of genitalia.
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SkyVue, the 500-foot Ferris wheel rising across the Strip from Mandalay Bay, has quietly found an ally in its rivalry with Caesars Entertainment Corp.’s Project Linq.
Shotgun Creek Investments, headed by Wayne Perry, a prominent Seattle businessman and part-owner of baseball’s Seattle Mariners, has “invested tens of millions” in the project and may put in more, according to a statement released Wednesday by SkyVue.
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According to the latest Nevada State Gaming Board report, gaming revenues in Nevada rose nearly 6.2% in April. And as Chris Sieroty noted, high-end baccarat was a key driver for the state’s performance as well as the Strip’s 7.5% revenue boost.
High-end baccarat gets a lot of attention because it is seen as a barometer for the health of the Chinese economy. But by focusing on the high-end metrics, analysts are missing the resurgence in the low-end, locals, market.
The Local Rebound
The Strip’s gains were dwarfed by two of Clark County’s smaller gaming markets. In April, gaming revenues in North Las Vegas, cited as one of the ten worst-run cities in America, were up 42.3%. Downtown gaming revenues also got a nice 25.0% bump, aided in part by the reopening of the Plaza last September.
You won’t find too many baccarat whales Downtown or in North Las Vegas. What you will find are slot-playing locals. Slot revenues rose 53.3% in North Las Vegas and up 34.7% Downtown. Local-centric Station Casinos offered more evidence of a home-grown rebound, posting its best earnings in three years.
No Thanks to Tourists or Poker
Better gaming revenues gains were not the result of more visitors to Las Vegas. April was the first month in roughly two years to see a drop in visitor volume. According to the latest Las Vegas Convention and Visitors Authority report, visitor volume was down 0.9%. Hotel and motel occupancy was down 1.2%, while convention attendance dropped 4.9%.
Gaming revenues were also not helped by poker. Card game revenues in April were down 0.6% in the state, down 8% in Clark County and down 10.9% on the Strip. Unlike visitor volume, the drop in poker is not a new phenomenon. Poker’s waning revenue stream is a continuing trend, which we covered here in detail.
As hinted at below, I spent a lot of time last month investigating the Las Vegas housing market by no choice of my own. (I have indeed found a place — it is a renter’s market here, after all — move this weekend.) All this searching coincides with a handful of poker players reaching out for info about WSOP accommodations. The World Series, of course, brings a lot of visitors to Vegas for an extended stay — anywhere from two weeks to two months — yet they’re hesitant about Extended Stay America because of ricin. Fortunately there are plenty of other affordable, non-casino options for those looking for a home away from home during the annual poker hajj, compliments of, at least in part, a housing crisis that’s being debated in Washington as we type.
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