June gaming win improves, but still well below normal coronavirus casino
Gaming win picked up for the state in June, the month when casinos were allowed to reopen, but totals still fell well short of normal levels, the state Gaming Control Board said Wednesday.
Statewide win was off 45.5 percent compared with June 2019 to $566.8 million for the month. Clark County was down 51.4 percent to $441 million, the Strip fell 61.4 percent to $238.3 million and downtown Las Vegas was off 55.6 percent to $23.2 million.
By percentage, the Strip and downtown Las Vegas had the worst June declines in the state.
Michael Lawton, senior research analyst for the Gaming Control Board, said the Strip and downtown were being compared with exceptional results in June 2019. In those months, the Strip and downtown experienced increases of 17.7 percent and 18.5 percent, respectively, from their previous years.
Locals and drive-in visitors
June was the first month of meaningful revenue for the state’s more than 400 licensed casinos after they were ordered closed by Gov. Steve Sisolak in mid-March in a bid to slow the spread of the coronavirus pandemic.
Gaming win was down 99.6 percent in April and 99.4 percent in May from 2019 levels.
Gaming win is important because it’s the taxable amount the state can collect for its general fund. Through Tuesday, the state had collected $344,027 in gaming taxes for the new fiscal year, a 99.4 percent decline from the previous year.
State leaders determined Nevada faced a $1.2 billion budget deficit as a result of the pandemic, and the Nevada Legislature met in a special session this month to determine how to plug the deficit hole. None of the solutions involved gaming taxes.
When casinos were allowed to reopen on June 4, they were at greatly reduced capacities with half the normal occupancy allowed. Even without the occupancy restrictions, casino patrons showed a reluctance to return in large numbers, with most of the traffic coming from local residents or from drive-in markets.
Some markets most dependent on drive-in traffic produced a rarity in June — an improvement in win from 2019. One such market was Mesquite, which reported a win of $10.1 million, 3.2 percent more than in June 2019.
Lawton said Mesquite, which thrives as a drive-in market from Utah and a getaway destination for Las Vegans, had higher win in June, with Mesquite coming off a modest 2.9 percent increase from 2018 to 2019.
Nevada sportsbooks lost money in June, the first time that has happened since July 2013. Sports pools lost $483,000, down 102.9 percent from the $17.1 million won in June 2019.
Lawton said much of the loss could be attributed to books paying off previous winning football tickets from January and February since June was the first time casino books were publicly open since March.
Lawton also said the amount wagered was $78.2 million, down 75.8 percent from a year earlier, and the amount won was -0.6 percent compared to a 5.15 percent hold in June 2019.
The June results were the last month of the 2019-20 fiscal year. For the year, the state’s casinos won $9.328 billion, down 21.7 percent from 2018-19. Clark County casinos won $7.967 billion for the year, down 22.3 percent. The Strip was off 23.4 percent to $5.01 billion and downtown Las Vegas, 20.2 percent to $531.2 million.
Longer recovery for Strip
A gaming industry analyst said the June results showed the Las Vegas locals market is recovering faster than the Strip, and he told investors in a report that Boyd Gaming and Red Rock Resorts (Station Casinos) stock may be better investment choices.
“The locals market is recovering faster than the Strip gross gaming revenue, which makes sense given the general Clark County area population benefits from the Paycheck Protection Program and unemployment checks and a retiree base in the area,” said Joe Greff, an analyst with New York-based J.P. Morgan.
“Similarly, we believe these results reflect Strip traffic coming from mostly, if not all, drive-in visitors, operating with limited amenities (food and beverage, no shows, nightclubs, etc.), and the staggering of reopenings,” he said. “We continue to prefer locals-exposed operators Boyd and Red Rock Resorts over Strip operators.”
The Las Vegas Convention and Visitors Authority, which normally reports visitation results on the same day as gaming win, said Tuesday that its June report would be released next week.