Las Vegas Strip casino revenues fell 4% in February, in a month that was mildly positive on a statewide basis, up 1%. Blame baccarat: Play was down 22%, although players took the house to the cleaners, with casino win down 23%. Were it not for the baccarat blowout, Strip gaming revenues would have been up 3%. J.P. Morgan analyst Joseph Greff wrote that “the market should continue to experience volatility in baccarat play given the slowdown in Chinese players; that said, non-baccarat table and slot handle volumes are getting better,” adding that slot revenue numbers were artificially low because the month ended on a Saturday. (Weekend slot play isn’t counted until Monday.) Even so, slot win rose 4.5%, even on 2% lower coin-in. Non-baccarat table play was flat, grossing $165 million.
For a change, locals play outdid the Strip, rising 4%, even with Downtown only Continued >>
“There is a reason bondholders restricted the funds that could be paid out to owners. Bondholders lost almost everything in Station Casinos’ Chapter 11 bankruptcy reorganization, which followed a leveraged buyout that paid insiders $660 million with borrowed money … Even though Deutsche Bank and the other owners are ‘happy with the performance’ of Station Casinos, as the company described it recently, they shouldn’t pay themselves a special dividend by levering up the company and putting virtually all the risk on the unsecured creditors,” — Culinary Union Research Director Ken Liu, on a proposal by Station to borrow $300 million in order to pay dividends to ownership, a bit of crony capitalism that’s flown under the media radar.
Two Hong Kong-based stock analysts recently met with the Macanese Gaming Inspection & Coordination Bureau. Much to their surprise, when they asked “what
positive policy measures can be enacted to help stop the trend of negative gaming revenue growth,” they were led to believe “the current negative run-rate of gaming revenues is so far not a major concern.” This comes on the heels of Chief Executive Fernando Chui‘s prediction of a 31% decline in gambling revenues. Chui also vowed to “adjust the pace” of casino growth in Macao, “without changing the momentum.” (Two goals that sound, at first blush, irreconcilable.) He promised tighter regulation and more attention paid to problem gambling. Job losses, Chui warned, might be a side effect of his new policies.
Then there’s the dreaded Continued >>