Casinos suffer largest ever drop in win
December 11, 2008
CARSON CITY, Nev. “-Nevada casinos suffered their largest ever drop in winnings in October ” taking in 22.3 percent less than in October 2007.
Gaming Control Board analyst Frank Streshley said the percentage looks even worse since October 2007 was the best month Nevada casinos have ever had, at $1.165 billion.
Casinos reported $904.9 million in winnings for October, a $260 million decrease, which Streshley said is the largest dollar decline in history.
Director of Administration Andrew Clinger said the numbers won’t lead to more budget cuts this year. He said his office, legislative analysts and Streshley anticipated October would be bad and built that assumption into the projections presented to the Economic Forum Dec. 1.
Based on those projections, the Forum predicted a 12.1 percent drop in gaming percentage fee revenues this year. Clinger said collections thus far are 13.2 percent below last year.
“It’s not the end of the world,” he said. “We expected October to be bad.”
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Only one market in the state had a larger total win in October than a year ago — the Carson Valley Area, which includes Carson City and valley portions of Douglas County. Win rose 3.5 percent in Carson to $9.99 million.
“I don’t have a direct answer,” Streshley said about the lone gainer. “For the majority of the state we’re seeing double digit declines in spending.”
Although Bodines opened in the past year, he said that establishment isn’t big enough to swing the win number from double digit negative to a positive.
In Carson City the total amount wagered in slots dropped only 5.6 percent, which Streshley said was offset by a half-percent increase in the amount those slots kept.
According to the detailed revenue report, win from the new high-tech penny slots ” which make up a quarter of the area’s machines ” increased by 60 percent.
Streshley said gaming operators told him the market crash, rising unemployment and the nation’s economic woes combined to sharply reduce what people were willing to wager. The total coin-in for slots fell 13.7 percent, and game and table wagering was down 18 percent ” a total reduction in the amount wagered during October of more than $2 billion.
North Shore casinos suffered a 15.7 percent drop in win this October. It posted a 22 percent drop in 2007 from the previous year. Total win there was just $2.2 million.
South Shore casinos were down $23.8 million to $20.9 million.
Washoe County saw total win fall 9 percent to $78.1 million.
The biggest hit was on the Las Vegas Strip, where win fell 25.8 percent to $475 million. That is $165 million less than a year ago. But every reporting area in Clark County was down double digits, with North Las Vegas hardest hit at 34.5 percent and Laughlin suffering the least at 14.9 percent down.
Even Elko casinos, which have suffered the least because of the continuing mining boom and high gold prices, took a 6.5 percent hit in October.
Going forward, both Streshley and Clinger said they expect much smaller percentage declines, but not because the economy is getting better. It’s just that the slump in gaming win began last November. Instead of comparing to record high months, the state will be comparing to weak months.
November 2007 was down nearly 14 percent from the previous year and, while December was up 3 percent, the last 10 months have all been down.
“The percentage should flatten out, but, dollarwise, we will still be declining,” said Streshley.
Statewide $904.96 billion -22.33%
Carson Valley $9.99 million 3.47%
South Shore $20.9 million -23.78%
North Shore $2.17 million -15.67%
Washoe County $78.1 million -9.03%
Reno $57.5 million -7.43%
Clark County $757.5 billion -24.34%
Las Vegas Strip $475 million -25.77%