Casinos Win Big on Baccarat - Revenues Rise 11%
Baccarat giveth and the baccarat taketh away. In August, the game giveth. Nevada recorded its fourth highest baccarat revenue total ever during August
and the highest percentage increase since June 1999, fueling double-digit gaming
revenue totals statewide and along the Strip.
The Gaming Control Board said that casinos statewide collected almost
$955.3 million in gaming revenues during August 2013, an 11.17 percent increase
compared with $859.3 million collected in August 2012. Baccarat revenues
accounted for more than 69 percent of the state’s monthly increase.
On the Strip, casinos collected $589 million in August, an increase of 19.98
percent compared with $490.9 million in August 2012.
The hold percentage for Baccarat — the amount of wagers the casinos kept
compared to was what was won by players — was 18.85 percent. The 12-month
average hold for baccarat is 12.83 percent.
“Although the headline number looks strong, this was mostly a ‘luck’-driven
result, as Strip properties played extremely lucky in August,” RBC Capital
Markets gaming analyst John Kempf told investors.
Other Table Games Not Far Behind
The Strip also had a strong month from table games. The revenue from games,
minus baccarat, increased 21.5 percent.
“While baccarat is clearly the star of the month, domestic play exhibited
encouraging trends,” Deutsche Bank gaming analyst Carlo Santarelli told
investors.
Stifel Nicolaus Capital Markets gaming analyst Steven Wieczynski said Strip
casino operators have seen improved numbers in the past few months coming from
food and beverage offerings, which can be attributed to normal tourist traffic.
Gaming revenues, however, has largely been driven by internationally sourced
baccarat play.
“All told, we are generally pleased with the August results,” Wieczynski
said. “As we have noted for some time, we continue to believe a more pronounced
Strip recovery will be largely predicated upon a return of domestic
visitation.”
The amount wagered on baccarat actually fell 1.3 percent to $1 billion.
Gaming Control Board Senior Research Analyst Michael Lawton said the decrease
was the fifth consecutive monthly decline in baccarat wagering, a game that is
often dependent on special events centered around high-end business.
Union Gaming Group Managing Director Bill Lerner said that historical high
baccarat volume takes place in January and February (Chinese New Year) and the
September and October period (special events).
“Recently, there seems to be less clarity on when large players come into
town,” Lerner said.
The double-digit gaming revenue increases statewide and on the Strip were a
rebound from steep declines in July.
With August’s results on the books, statewide gaming revenues up less than 1
percent for the first eight months of the year. On Strip, gaming revenues have
increased 2.1 percent through August.
“We believe the recovery in Las Vegas’s gaming fundamentals remains tepid,”
Susquehanna International Group gaming analyst Rachael Rothman told
investors.
During August, Clark County as whole did not fare as well.
Casinos in North Las Vegas saw gaming revenues decline almost 18.3 percent,
casinos along the Boulder Strip experienced a 12.7 percent decrease, while
downtown casinos saw gaming revenues drop 8.3 percent.
Overall, Clark County gaming revenues increased 12.3 percent.
Lawton attributed the declines in certain markets to slot machine revenue
reporting timing for the locals market due to the month ending on a weekend.
Much of the slot machine totals in the locals market will fall into September’s
figures.
Meanwhile, revenues from the balance of Clark County increased 4.47 percent
during August. The reporting area includes revenues from Ultimate Poker, which
was the state’s only online gaming website operating in August.
Union Gaming Group said the results are included with revenues from card
games, which showed an increase 43.7 percent in August. Lerner said the number
implied that online poker did “roughly $600,000 in gaming revenue during the
month.
“We believe this is notable given there hasn’t been many tangible financial
results yet of online gaming,” Lerner said.
Gaming regulators won’t break out online poker revenues into a separate
category until three websites are operating.
Nevada collected $514 million in gaming taxes through Sept. 26, based gaming
revenues reported in August, an increase of 3.46 percent. For the first three
months of the fiscal year, gaming tax collections are up less than 1
percent.
~ As reported by Howard Stutz in the Las Vegas Review Journal newspaper - hstutz@reviewjournal.com
~ Source of this article for Casino Insider News is from RMC Daily News - www.rmclegal.com
