A 3.1 percent decline in Nevada gambling revenues during August disappointed some observers who hoped July’s $1 billion revenue figure foreshadowed a stronger recovery.
Statewide, gambling revenues hit $859.2 million, which was down from $886.8 million in August 2011, according to figures released Wednesday by the Gaming Control Board.
On the Strip, gambling revenues fell 1.2 percent to $490.9 million, down from $496.9 million a year ago. The Strip’s figure was also $109 million less than what casinos took from gamblers during July.
“These results point to a continued uneven recovery on the Las Vegas Strip, which represents no change from prior and more recent views,” JP Morgan gambling analyst Joe Greff told investors.
The Strip and statewide numbers could have been far lower.
Baccarat revenues grew 32 percent in August to $124 million. The amount gamblers wagered on baccarat increased 30 percent to $1 billion. Baccarat play has been carrying the Strip in 2012. Through August, volume is up almost 14 percent while revenues from the game are up 16.9 percent.
“Strong baccarat play quarter to date will help support third quarter estimates, but do not reflect broader fundamentals on the Strip and highlight the volatility of this segment,” Susquehanna International Group gambling analyst Rachael Rothman told investors.
Other table games, not including baccarat, saw revenues decline 8.5 percent.
Revenues from slot machines on the Strip fell 9.1 percent. The amount wagered on slot machines by Strip customers also declined for the fifth straight month.
Number of visitors increases in August
Visitation to Las Vegas rose slightly in August, helping the city stay on track toward its year-end goal of 40 million visitors.
Total visitor volume for August was up 1.5 percent from the same month in 2011, according to the monthly Las Vegas Convention and Visitors Authority count released Wednesday. In all, 3.34 million tourists came to Las Vegas in August, up from August 2011’s 3.29 million total. Year to date, 26.7 million people have visited the city, up 1.8 percent from the same point in 2011.
August’s citywide hotel and motel occupancy combined decreased ever so slightly, from 84.1 percent in 2011 to 84.0 percent in 2012. Year-to-date it declined from 85.2 percent in 2011 to 85.1 percent in 2012.
When looking at just hotels, occupancy decreased month-over-month to 87.7 percent in 2012 from 88.5 percent in 2011. Year-to-date, hotel occupancy rose by 0.3 percentage points to 88.4 percent from 88.1 percent in 2011. Motel occupancy’s year-to-date count dropped 3.4 points to 55.8 percent from 2011’s 59.3 percent.
Two groups extend leases with Convention Center
The Las Vegas Convention and Visitors Authority has a good reason to celebrate.
Both the MAGIC and SEMA conventions signed lease extensions with the Las Vegas Convention Center that are expected to bring a combined nongambling economic impact of $1.4 billion to Las Vegas the next few years. As two of the largest conventions that come to Las Vegas each year, both shows are considered anchor tenants at the convention center.
MAGIC, the Men’s Apparel Guild in California, attracts about 80,000 attendees twice yearly, while SEMA, the Specialty Equipment Market Association, draws about 130,000 people to its annual show. The estimated nongambling economic impact from MAGIC’s lease extension, which runs through 2015, is $611 million, according to the convention authority. SEMA’s extension, which runs through 2017, is expected to have an $827 million nongambling economic impact on the Las Vegas community, the authority said. The shows support about 2,000 jobs in Las Vegas.
“Those are large infusions of dollars into Las Vegas that supports jobs,” Las Vegas Convention and Visitors Authority President and CEO Rossi Ralenkotter said. “That’s very important as we look to add more jobs in the future.”
The two shows couldn’t seem to say enough about working with the authority. MAGIC has been coming to Las Vegas since 1989 and SEMA since 1977.
“The LVCVA is really an incredible partner,” said Tony Calanca, executive vice president of exhibitions for Advanstar, which produces MAGIC. “They are hungry for the business despite having the biggest chunk of market share.”
Las Vegas’ market share of the nationwide convention and meetings industry is 12.5 percent.
In 2011, Las Vegas hosted 19,029 meetings and conventions with an attendance of 4.87 million people and an economic impact of about $6 billion. Those conventions support 58,000 jobs in the city throughout the year.
MGM Resorts gets positive debt review
Fitch Ratings Service upgraded its view of the debt covering MGM Resorts International and the company’s hotel-casino in Macau.
The advisory service also affirmed its positive view of CityCenter, half-owned and operated by MGM Resorts.
In statement Thursday, Fitch gambling analyst Michael Paladino said the positive views of MGM Resorts were based on the service’s “continued positive outlook on Las Vegas Strip fundamentals over the next couple of years, despite some recent demand weakness.”