A number of casino companies have reported an improvement in their quarterly revenue, despite a slow recovery from the impact of the pandemic and a surge in positive cases in the US.
Retail Casino Revenue Tripled Since Q2
Despite the economic impact of the Covid-19 pandemic on the casino industry, some gaming companies reported a better-than-expected performance over the past months.
According to the American Gaming Association’s analysis on earnings, retail casino turnover in the US jumped by 294% since the second quarter. This is, unsurprisingly, a result of reopenings and cost-cutting measures taken by gaming companies to minimize the consequences of lockdown and coronavirus-related restrictions.
The states have taken various decisions to allow the gaming industry to recover, from fully shutting down casinos to partially reopening.
As of today, 911 out of 944 US gaming facilities have reopened with reduced operations, which included 442 retail casinos and 469 tribal venues (94.7% of all commercial casinos and 89% of tribe-owned properties.)
AGA CEO Says Congress Must Provide Covid-19 Relief
However, reports show that gaming turnover fell by 36.5% year on year from January to September 2020, while the nation’s gross domestic revenue only reported a 3% decrease over the same period.
Association President and CEO Bill Miller urged Congress to take action and “provide Covid-19 relief”, as the number of positive cases has dramatically increased since the end of lockdown. “Gaming employees and communities depend on it,” he added.
“Our industry continues to prioritize the health and safety of our employees, customers, and communities above all else. While these quarterly results are promising, the reality is a full recovery is dependent on continued public health measures to control prevalence rated.”
Bill Miller, American Gaming Association President and CEO
Regional Casino Operators Report Better Results
Caesars Entertainment, MGM Resorts International, and Penn National Gaming Inc. generated the most income in the third quarter, mainly due to layoffs and cost-cutting decisions. According to the AGA, the retail gaming industry yielded $9.04 billion in total in the third quarter, which ended on September 30. Caesars reported $1.377 billion in gaming revenue, as MGM Resorts and Penn National announced $1.126 billion and $1.1 billion in turnover in Q3, respectively.
Penn National was the only gaming company to report a net profit, with $141 million.
Regional gaming companies, with casinos in various states, were expected to do better than others during the pandemic, analysts had predicted.
For instance, Las Vegas Sands Corp. and Wynn Resorts both reported lower revenue for the quarter than Boyd, which has casinos and horse track casinos (racinos) in 10 states. Las Vegas Sands operates three locations in Las Vegas, while Wynn manages Wynn Las Vegas and Encore in the city, with another casino resort in Massachusetts.
Sands and Wynn suffered from fewer visitors and reduced air travel, as well as the lack of conventions and events since March.
“I don’t see a lot of change in Las Vegas for us until there’s a change structurally and the governor’s position, the airline position, and the willingness again of consumers, I think people coming here on weekends and sitting in a room is one thing.”
Rob Goldstein, Sands CEO
Several companies, including affiliated investment businesses, reported better numbers for the third quarter year on year. Caesars’ affiliate VICI Properties, a real estate investment trust, said the third quarter was profitable for the company, with $396.2 million in net income, up 52,6% compared to the same period last year.