May 2019
The March Wind was a Good Wind

March was a good month for gaming. Total gaming win from casinos, sports betting, and VLTs nationally reached $4 billion, an increase of 4.2 percent from March of 2018. Sixteen states reported increases in gaming win compared to six states with decreases. The increases occurred despite the calendar being neutral, with five Fridays, five Saturdays, and five Sundays in both March 2019 and March 2018.
 
The industry is seeing some positive impacts from sports betting this year. That was particularly true for March, when the national college basketball tournament was held. This year six states were taking sports bets; last year only Nevada booked the tournament.
 
The economy is certainly as good as or better than last year. March is a big month for people getting tax refund checks. Analysts were predicting a decline of 17 percent in the average amount of refunds, but that narrative is changing; it now appears that more people are receiving a refund and the average refund check is larger than last year. The only drag for the month was the weather, with some regions continuing to experience extreme weather conditions. Overall, March had some strong weather, but for the most part the winds were favorable ones.
March 2019 Casino and VLT Revenue:
 
Atlantic City gaming revenues rose 34.5% to $294.0 million. Gaming Commission, 4-19
 
Colorado casino revenue fell 6.1% to $72.7 million. Gaming Commission, 4-19
 
Delaware rose 29.2% to $38.5 million. Lottery Commission, 4-19
 
Detroit casino revenues rose 1.3% to $140.3 million. Gaming Commission, 4-19
 
Florida slot revenue rose 5.2% to $57.8 million. Gaming Commission, 4-19
 
Illinois casino gaming revenues rose 5.05% to $284.8 million. Gaming Commission, 4-19
 
Indiana gaming revenue fell 3.4% to $258.7 million. Gaming/Racing Commission, 4-19
 
Iowa casino revenues rose 0.49% to $142.6 million. Gaming Commission, 4-19
 
Kansas gaming revenue rose 1.0% to $40.2 million. Racing and Gaming Commission, 4-19
 
Kentucky historic racing machine revenue rose 119.5% to $19.6 million. Racing Commission, 4-19
 
Louisiana gaming revenue fell 1.3% to $306.9 million. Gaming Commission, 4-19
 
Maine gaming revenue fell 1.5% to $13.0 million. Gaming Commission, 4-19
 
Maryland gaming revenue rose 8.8% to $163.2 million. Lottery/Gaming Commission, 4-19
 
Massachusetts gaming revenue was rose 163.2% $41.6 million. Gaming Commission, 4-19
 
Mississippi gaming revenues rose 5.1% to $212.9 million. Gaming Commission, 4-19
 
Missouri gaming revenues fell 1.1% to $166.4 million. Gaming Commission, 4-19
 
Nevada gaming revenue fell 0.12% to $1.022 billion. Gaming Commission, 4-19
 
New York casino/VLT revenue rose 8.1% to $252.6 million. Gaming Commission, 4-19
 
Ohio gaming revenue rose 3.3% to $184.1 million. Gaming Commission, 4-19
 
Pennsylvania gaming revenue rose 4.6% to $314.6 million. Gaming Commission, 4-19
 
Rhode Island gaming revenue rose 12.6% to $53.5 million. Gaming Commission, 4-19
 
South Dakota gaming revenue rose 0.34% to $29.5 million. Gaming/Lottery Commission, 4-19
 
Total gaming revenue rose 4.24% to $4.031 billion. David Rohn, 5-1-19

The other categories:
 
Macau gaming revenue fell 0.4% to $3.2 billion. Reuters, 4-1-19
 
Connecticut slot win fell 7.3% to $91.2 million. Hartford Business, 4-16-19
 
Adams Index fell 5.7% to 561.35. CDC Newsroom, 3-19
 
Dow Jones Industrials fell 0.37% to 25928.68. Yahoo Finance, 3-29-19
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Across the Country

Atlantic City is rocking. With two new casinos, plus online gambling, plus sports betting, the city had another great month, up 34 percent. The casinos were up 15.7 percent to $223.2 million; slots were up 18.5 percent to $162.6 million, and tables were up 8.7 percent to $60.5 million. The combined win of the two new casinos, Hard Rock and Ocean Resorts, was $39.6 million. For the first quarter of 2019, gaming revenue in New Jersey was up 7.5 percent to $2.896 billion; gross profit was down 15.4 percent to $582.6 million.
 
But excluding Hard Rock and Ocean Resorts, the other seven casinos were down 4.9 percent to $183.3 million. Only two of those seven reported an increase in revenue in March compared to a year ago: Caesars, 4.3 percent, and Resorts, 0.6 percent. Internet gambling and sports betting are the “good guys” in Atlantic City, helping everyone. Online gaming revenues were up 53 percent to $39.1 million and the win on sports was $31.7 million.
 
Hard Rock and Ocean Resorts have added 4,008 slot machines and 267 table games to the market, so far. In response the other seven casinos reduced their inventory by 393 slot machines and 10 tables games, compared to a year ago. The two new casinos, besides taking market share from existing casinos, are also forcing their competition to spend more on marketing. These are the type of adjustments that will continue in Atlantic City, particularly with the expansion that is due in Pennsylvania.
 
In fact, adjusting to the competition is a national theme, not just a phenomenon in Atlantic City. Nearly every jurisdiction is seeing changes forced by competitive pressures. In most states there is a reshuffling of product to match the level of demand. As long as new casinos keep coming online, those adjustments will continue. The easiest to track of the changes is the reduction in the number of slot machines and table games; such reductions are becoming a common theme.
 
Illinois is the poster- child for the adjustment process. In March, the casino win was $126. 1 million, down $1.7 million. Admissions to the casinos were 956,366, down 4.1 percent from 2018. The number of slot machines was down 2.4 percent to 9,678. On the other side of the coin, VLT revenue was up 11.1 percent to $158 7 million and the number of units increased by 8.5 percent to 31,481. The change is not extraordinary across just 12 months, but comparing March 2013 to March 2019 makes the trend quite visible. In March 2013 the casino win was $149.1 million, with 1,397,559 admissions and 11,312 slot machines. By comparison, the March 2019 win was down 15.4 percent, admissions were down 31.5 percent, and there was a 14.5 percent decrease in slot machines. In contrast, VLT revenue in March 2019 was eight times what it was in 2013; there were 26,463 more VLTs this month than six years earlier.
 
Maryland is still rolling on. MGM National Harbor reported $62.7 million in win, up 3.9 percent; Live Casino had $55.9 million, up 19 percent; and Horseshoe Baltimore had $25.6 million, up 3 percent. At the smaller venues, Hollywood had $7.1 million, up 0.5 percent; Ocean Downs had $6.6 million, up 12.4 percent; and Rocky Gap had $5.1 million, up 9.2 percent. Since last March, casinos in the state have added 596 slot machines, for a total of 11,512, and 35 table games, for a total of 607. The market in Maryland is still expanding and the casinos are still expanding to meet the demand,
 
Massachusetts has one casino, MGM Springfield, and one racino, Plainridge Park. Together they generated $41.6 million of revenue, with MGM Springfield accounting for $25.6 million. Plainridge, at $15.9 million, reported $100k more in win than last year. Maryland and Massachusetts are exceptions to the trend of reducing product to meet demand; both are still in an expansion mode.
 
Indiana’s casinos reported a 3.4 percent decline in win to $213.4 million. Table game win was $30.8 million, down 6.0 percent, with the number of games falling 2.3 percent to 669. Slot revenue fell 0.9 percent to $186.5 percent, with casinos reducing the number of slot machines by 2.6 percent to 18,113 units. The major negative forces affecting casinos in Indiana are the casinos and racinos in Ohio and the VLTs in Illinois. There are also two racinos in Indiana, with 2,000 slots each. While they do not appear to have had much of an impact on the casinos, yet, with a new owner, Caesars, and with table games coming this summer, that may change. And while the state has authorized another license and the moving of a license, plus sports betting, those changes will probably not affect anyone for at least a year.
 
Louisiana was down slightly overall, but VLTs, Harrah’s, and racinos were up. VLT revenue was up 3.7 percent to $60.8 million from 12,952 units, 538 less than last year; Harrah’s New Orleans was up 7.8 percent to $28.9 million; and racino win was up 1.1 percent to $36.0 million. On the other hand, riverboat casino win was down 4.6 percent to $181.2 million, driven by an 8.6 percent decline at Lake Charles and a 13.0 percent fall at Baton Rouge. Overall, admissions to the casinos and racinos for March 2019 were 2,772,902, down 1.1 percent from the previous March. Sports betting in Mississippi, a smoking ban in Baton Rouge, and Indian casinos in Oklahoma are having an impact on riverboat gambling on the Bayou.
 
Mississippi had a good month, a least partially due to sports betting. Sports betting added $1.1 million to the total win. Besides the actual win amount, sports betting probably drew a significant number of gamblers from Louisiana, especially during March Madness. The coastal casino win was up 13 percent to $123.8 million. The coast has had a good year; in March there were 14,060 slot machines on the coast, up 500 units from last year.
 
In Mississippi, only Tunica reported a decline in revenue for the month, down 9.5 percent. Tunica will continue to decline as it is under extreme competitive pressure, pressure that will increase with the advent of full casinos in Arkansas. The results of that pressure can be seen in the number of slot machines: in March there were 7,243, which is 700 less than last year.
 
New York’s casinos and racinos reported increases in revenue while both reduced the number of slot machines. Casino revenue was up 21 percent to $56.6 million while the number of slot machines fell 2.3 percent to 6,058. The VLTs at the race tracks generated $196 million, up 4.8 percent, while the number of units dropped 1.7 percent to 18,406. Overall, the casinos have not lived up to expectations, which is fortunate for the racinos.
 
The New York market is proving itself to be smaller than expansion advocates predicted. Other than the New York City market, the state does not seem particularly viable for a major casino investor. New York City, however, is a plum of rare quality. Resorts World in New York City generated 32.6 percent of the VLT revenue in New York and 25.2 percent of the total gaming win in the state in March, with only 22.6 percent of the slot machines in the state.
 
Ohio casinos reported $81.0 million in total casino win, down 0.85 percent; slot revenue was up slightly to $55.8 million, but table game revenue fell 4 percent to $25.2 million. The casinos have taken 10 tables and 56 slot machines off the floor since March 2018. The racinos reported a 6.9 percent increase in win to $103.1 million and have added 103 slots.
 
Total reported revenue in Pennsylvania was up 4.6 percent. But the state does not include sports betting in its casino totals, so the reported win for casinos in Pennsylvania, $309.1 million, was up only 2.8 percent. The sports win of $5.5 million brings the reported state total to $314.6 million; that excludes revenue from fantasy sports of $1.6 million.
 
Parx leads the Pennsylvania in revenue, with $56.7 million in March, up 3.9 percent. Its slots were up 4.8 percent to $39.2 million and its table game revenue rose 2 percent to $17.5 million. The Sands, which has been struggling under pressure from the casinos in New York, had a good month, with total revenues up 8.9 percent to $50.9 million; slots were down 0.5 percent to $27.9 million, but tables games were up 22.7 percent to $23.2 million. The Rivers Casino in Pittsburg is number three on the revenue chart; its revenues were up 6.5 percent to $35.7 million, with slot win up 6.2 percent to $28.2 million and tables reporting $7.5 million, up 8 percent.
 
Rhode Island is not the biggest gambling state in the union - with a year-to-date total for gaming revenue of $161.8 million, it ranks 16 th on the chart. But it has an interesting story. Rhode Island has two casinos, Twin Rivers and the Tiverton Casinos; the two have a total of 5,100 slot machines and 150 table games. The slot win for the larger casino, Twin Rivers, was down slightly in March to $40.2 million. The casino took 103 slots off the floor, leaving 4,113; meanwhile the casino’s table game revenue was up. But the Tiverton casino reported $9.5 million in win in March 2019, more than twice the win of its predecessor, Newport Grand, in March 2018. The biggest change was slot win, $9.2 million versus $4.1 million. Tiverton is a casino that moved from a bad location and has prospered; even so it did take 100 slots off the floor compared to a year earlier.
 
Nevada crossed the billion-dollar threshold again in March; according to the Las Vegas Review-Journal , the 42 nd time Nevada casinos won over $1 billion in a month. But in March the win was down $2 million, which is 0.12 percent, compared to last year. The Strip was down 3.8 percent to $551.9 million, the downtown casinos were up 8.6 percent to $58.6 million, Boulder Strip was up 8.9 percent to $70.3 million, Laughlin fell 4.2 percent to $49.6 million, Reno dropped 1.9 percent to $49.9 million, Sparks was up 3.5 percent to $12.4 million, North Lake Tahoe was up 2.2 percent to $2.0 million, South Lake Tahoe win rose 9.6 percent to $15.9 million, Carson Valley was down 0.6 percent to $9.1 million, and Elko County was up 10.6 percent to $30.0 million, $20.5 million of which came from Wendover.
 
As Michael Lawton an analyst for the state, said in explaining the overall decrease in casino win for March, baccarat was the culprit. Baccarat was off 54.3 percent to $53.6 million. Even at half of last year’s win, baccarat still generated more win than any single jurisdiction except the Strip and the Boulder Strip. For other games, blackjack was up 13.7 percent to $108.3 million, craps rose 2.3 percent to $34.8 million, and roulette jumped 43 percent to $41.7 million. The total for a table games in Nevada, including Pai Gow, mini baccarat, 3-card poker, and Let it Ride, was $347.6 million, a decrease of 8.7 percent. There were 5,499 table games in Nevada in March, a decrease of 171 units from last year. Slot win rose 4.9 percent to $675.3 million from 140,442 units, 894 less than in 2018. The win from sports was $32.5 million, down 4.8 percent; the total amount bet was $596.8 million, up 14.4 percent, thanks to March Madness being Mad.
 
Nationally in March, gaming revenues were up 4.2 percent and for the first quarter up 3.4 percent to $10.932 billion. Like its predecessor, 2019 is on track to be a good year for the industry. The growth is being driven by the same factors that fueled the revenue increases in 2018, new product. However, that growth will continue to pressure the majority of existing operations to restructure to fit the reduced demand. That is a necessary part of operating in a mature and saturated - or nearly saturated - industry.
This report is written by Ken Adams