Месяц: Июнь 2014

South Korea’s domestic gambling industry hit the wall in 2013, showing signs of stagnation after seven years of growth. Figures released by the Korea Leisure Industry Institute show gambling revenue – excluding bullfighting and the 16 foreigner-only casinos currently off-limits to locals – came to just under KRW 18.3t (US $18b) last year, about what it brought in during 2012. The number of visitors patronizing racing venues (horse, bicycle and boat) and the lone locals-allowed Kangwon Land casino fell 5.5%, continuing a downward trend that began in 2010.

Betting on cycling races fell 7.4% to KRW 2.3b, while cycling’s share of overall gambling revenue dipped one point to 12.6%. Boat racing revenue fell 4.3% to KRW 692b. Lotto revenue rose 1.5% to KRW 3.2b, while lotto’s share of the overall pie was basically flat at 17.7%.

Gambling turnover at Kangwon Land rose 5.8% to KRW 1.3t ($1.3b) thanks to last year’s addition of 400 slot machines. Since 2009, Kangwon Land’s turnover has risen 10.7%. The number of visitors to the casino rose 1.4% to just over 3m last year, despite its location in a former coal mining town in a remote mountainous region over 200km from Seoul, making getting there an only slightly more arduous trek than journeying to Mordor.

Kangwon Land opened in 2000 as part of an economic revitalization effort following the closure of the coal mine. It hasn’t been entirely successful, as the local population has fallen 40% since the loss of the mining industry. Still, the government-run resort casino employs some 3k South Koreans – 60% of them local residents – and contributes KRW 500b ($491m) in annual tax revenue.

South Korea is currently in the process of jumpstarting its casino industry by allowing foreign investment in large scale integrated resorts. Caesars Entertainment and Indonesia’s Lippo Group are planning a $2b project near the Incheon International Airport just west of Seoul, close to the site of Paradise SegaSammy’s ongoing expansion of Paradise Casino Incheon.

Further south, Genting Singapore and China’s Landing International Development are constructing a $2.2b facility on Jeju island. Other casino operators, including Las Vegas Sands, MGM Resorts and Crown Resorts have also publicly mused about South Korean possibilities. Not that locals will ever see the inside of any of these joints, mind you.

Atlantic City’s Revel Casino Hotel filed for bankruptcy on Thursday, the second time the troubled property has sought protection from creditors since it opened in April 2012. Despite a massive debt restructuring in March 2013, Revel says it has continued to bleed red ink, losing nearly $22m in the first quarter of 2014. Revel’s management said the announcement came following “an extensive strategic review” that basically involved opening up the cupboards and finding them bare.

Thanks to a $125m loan from one of Revel’s existing lenders, Revel will continue to operate through the bankruptcy proceedings. However, in a letter to employees viewed by the Associated Press, management warned that it could shut down permanently unless a deep-pocketed hero rides to its rescue. A shutdown, which could come as early as August 18, would throw over 1,700 full-time and 1,000 part-time employees out of work.

Since its genesis, Revel has been dealing with a curse worthy of Tutankhamen. Conceived prior to the global financial meltdown and before anyone realized Atlantic City’s gaming revenue swoon was permanent, Revel was dealt a blow in 2010 when Morgan Stanley wrote off $932m rather than invest another penny to see the project through to completion. When the property finally opened with a strict smoke-free policy, gamblers gave Revel a wide berth, leading to the first bankruptcy filing after less than a year in business.

The question now becomes: who would be daft enough to acquire a white elephant with a remarkable capacity to make money disappear? Prior to Thursday’s announcement, names like Hard Rock International and Caesars Entertainment had been cited as potential Revel suitors. Last month, Hard Rock president James Allen clarified that a deal was only possible “if the price is right.”

In April, local casino union Unite Here! suggested Revel wasn’t likely to turn a profit until 2024, leaving its current valuation at less than $100m. Other estimates have ranged up to $300m, which, considering Revel cost $2.4b to build, still sounds like quite the bargain. But as Deutsche Bank Securities analyst Drew Goldman mused at last month’s East Coast Gaming Conference, “just because something was really expensive doesn’t mean it’s still valuable at a fraction of what it cost.”

A buyer will also have to contend with the fact that more competition is headed Atlantic City’s way. Multiple resort-casinos are being planned in New York State and a new Fairleigh Dickinson University PublicMind poll revealed that 12% of New Jersey residents would choose to cross the border rather than gamble in AC. While 57% of New Jersey gamblers said they’d stick with AC, a 12% cut in the already razor-thin margins in AC casinos would not go unnoticed.

The Philippine division of casino operator Melco Crown Entertainment is looking to raise up to US $129m after significantly boosting the budget of its City of Dreams Manila resort casino. On Wednesday, Melco Crown (Philippines) Resorts Corp. suspended trading in its shares on the local exchange as it announced it was boosting the casino’s budget to $832m – an increase of 22%. This followed a similar announcement in October that expanded City of Dreams’ budget by 10% to $680m.

Melco Crown plans to raise the funds via the sale of up to 485m shares in its Philippines unit. A company filing stated that the budget boost was approved by a special meeting of the board of directors on Wednesday. No reason was provided for the increased spending, so we’ll suggest it’s to build a special anti-Godzilla wall in Manila Bay that will protect City of Dreams but leave the other three Entertainment City casinos exposed. City of Dreams is set to open in October featuring 365 gaming tables plus 1,680 slots and an equal number of electronic table games (ETG).

A little further north, Genting Singapore has announced it will delay the groundbreaking on its South Korean resort casino project. Genting had planned the ceremonial spade-turning for June 24 and had already issued invitations to dignitaries and the media. On Thursday, Genting said it was rescheduling so they could bring the newly elected governor of Jeju up to speed on their casino development plans. Today Online reported that the new groundbreaking date is tentatively set for sometime in the third quarter of this year. Resorts World Jeju, which Genting is developing in partnership with Chinese property firm Landing International Development, is scheduled to open for business in 2017.

Nevada casino gambling revenue fell 2.5% to $954.3m in October, snapping a two-month streak of positive revenue tallies. October’s decline was more pronounced on the Las Vegas Strip, where revenue fell 5% to $551.3m. For a change, it wasn’t bad luck at the baccarat tables that contributed most significantly to October’s slump, as slots revenue fell 6.3% to $576.1m. Again, the Strip’s slot decline outpaced the statewide tally, falling 10.9% thanks in part to a calendar quirk and an abnormally high hold percentage that inflated October 2012’s numbers.

Baccarat revenue dramatically outpaced all other table games, rising nearly 17% to $151.1m in October thanks to a 29% rise in sums wagered and a 13.3% hold rate. Baccarat accounted for 27% of total Strip casino win in October, a figure University of Nevada, Las Vegas gaming researcher David G. Schwartz said would have been “inconceivable several years ago.” There were 303 baccarat tables operating in Nevada in October, nearly three times the number available in the same month in 2004. During that same time frame, the number of slot machines in Nevada has fallen from nearly 178k to just over 156k.

Blackjack was the second most valuable table game, although revenue fell 5.2% to $85.4m. The rest of the table games numbers looked thus: craps ($33.2m, +14%), roulette ($16.1m, -68.3%), three-card poker ($12.4m, -7.5%), mini-baccarat ($9.8m, +47.3%), pai gow poker ($7.3m, +5.3%), let it ride ($3.2m, -16%), keno ($2.7m, -0.6%) and other games ($12.2m, +7%). Overall table game revenue was up 3.5% to $368.5m.

Poker revenue rose 9.5% to $9.6m, and while the Nevada Gaming Control Board won’t break out online poker revenues until more than two sites are operational, Union Gaming Group’s number crunchers suggested Ultimate Poker and WSOP.com contributed a combined $600k to October’s poker revenue total.

Nevada’s sportsbooks had a very healthy month, with revenue up 351% to $30.3m. Football results looked even better, rising 390% to $18.1m on a 5.3% hold and an all-time record handle of $342.6m. (Suffice it to say, it was a better result than October 2012, which saw a rash of favorites covering, resulting in a -2% hold.) Baseball was another story, falling 43% to $4.9m, while basketball dipped 13.5% to $1.7m. Parlay cards rose 85% to $4.4m, while racebook revenue slipped 5.7% to $3.9m.

Macau casinos earned a whopping MOP 360.75b (US $45.2b) in 2013, an 18.6% improvement over 2012’s total haul of MOP 304b. The growth also eclipsed 2012’s rate of 14% and beat virtually all analysts’ predictions, most of which had suggested something in the 12-15% range. The bounty was also achieved despite the year starting with rampant rumors of a crackdown on junket operators on the Chinese mainland, reportedly due to new Party leader Xi Jinping’s vow to stamp out corruption amid China’s political and business elites.

Macau casinos capped off the year with a $4.2b take in the month of December, up 18.5% over the same month a year earlier. That’s around $350m shy of October’s record monthly tally, but still represents two-thirds of the total $6.2b earned by Las Vegas Strip casinos in all of 2012. Strip casino revenue is projected to grow only around 4% in 2013 when final numbers are released at the end of January, meaning Macau is now earning roughly seven times what Vegas takes in on an annual basis. Leaving out tribal casinos, the entire US commercial casino biz generated just $37b in 2012, about $1b shy of what Macau earned that year.

Macau’s good times are expected to continue as casinos brace for the annual invasion of Lunar New Year revelers. But no new casinos are scheduled to open their doors in 2014, which could make sustaining the current growth rate a dicey proposition. Then again, recent infrastructure upgrades on the mainland will allow increased visitation, as evidenced by November’s 1.56m arrivals from the mainland, the highest influx in any November for six years and Macau International Airport traffic rose 11% to 5m passengers in 2013.

Macau’s non-gaming options will also get a serious boost via the overdue opening of the Chimelong Ocean Kingdom theme park on neighboring Hengqin island in January, the first phase of a project that will ultimately add nearly 2k hotel rooms to Macau’s total. Union Gaming analyst Grant Govertsen suggested Hengqin’s theme park could draw between 1m-2m visitors – 70% of whom would be of legal gambling age – in its first year of operation.

Some analysts are suggesting that China’s late-2013 vow to loosen restrictions on money movement could negatively impact Macau’s VIP market, which relies on junket operators to front sums of money that gamblers aren’t currently allowed to take out of the country. But even if capital controls are loosened, it would likely offer a boost to Macau’s ‘premium mass’ market, which was already nibbling away at the dominant VIP sector. Given that premium mass gambling cuts out the middlemen and thus allows the casinos to keep a significantly greater slice of the pie, Macau casinos aren’t likely to protest too strongly.

2013 has been a doozy of a year for casinos all over the world. From record revenues to incredible declines, there wasn’t a shortage of relevant casino news that made our pages. So with two weeks left in the year, it’s high-time to take a look at what news fell through the cracks and what rose to the top.

Japan’s casino legislation

On a year dominated by casino news all over the world, nothing stood out more than the potential opening of what’s already being touted as the second biggest gambling market in the world: Japan.

Numerous attempts at opening Japan up to casino gambling have been made in the past, but it only gained steam with the electoral victory of Shinzo Abe as the country’s new prime minister in July. With Abe’s Liberal Democratic Party (LDP) controlling both houses of the Diet, the push towards legalizing land-based casinos in the country become all too real. Then, Tokyo won the rights to host the 2020 Summer Olympics and the pro-casino movement gained even more momentum.

With all these chips falling into place, the question of whether Japan would legalize land-based casinos has somewhat become a formality of sorts. It’s come to the point that a number of world-class operators have already voiced their interest in bidding for these casino licenses in Japan and with the LDP beating the deadline to submit the casino bill before the current parliament session ended, 2014 is shaping up to be dominated up developments on how fast the country can legalize these brick-and-mortar establishments.

EuroVegas scrapped

News just broke last week of Las Vegas Sands‘ decision to scrap the highly anticipated EuroVegas project in Madrid so the reality really hasn’t sunk in yet. Disputes between the casino operator and the Spanish government on key issues derailed the project before it even began, putting to bed what could have been one of the biggest resorts and casino projects in the world.

It was supposed to kick-start Spain’s sorry employment state, which right now sits at an alarming 27 percent. EuroVegas also promised 250,000 employment opportunities, so its a very bitter pill to swallow for all parties involved knowing that the project is off the table and LVS is now looking at more opportunities in Asia to expand its casino empire.

But as far as EuroVegas is concerned, that’s all in the dirt now.

Solaire Resort & Casino opens in Entertainment City

The promise of big things for Entertainment City in the Philippines received its first shot in the arm with the opening of Bloomberry Resorts’ Solaire Resort & Casino back in March. Years of planning and development culminated in a landmark moment for Bloomberry and the Philippine Amusement & Gaming Corporation with the opening of Solaire, the first of the four world-class integrated resorts that will make up a majority of the Entertainment City air space.

With City of Dreams Manila, which is co-developed by Melco Crown and Belle Corporation, expected to open in 2014, the dreams of Entertainment City are slowly becoming a reality and 2013 will forever be remembered as the year when the Philippines stamped its name as a prime-time player in the Asian casino market.

Casino arms-race in Asia

For all the attention Macau and Singapore generate as two of the world’s biggest gambling market, it’s important to remember that 2013 was also the year when other Asian countries announced their intentions of being factors in the regional casino scene. Vietnam opened its first world-class resort and casino, the Grand Ho Tram Strip. Same thing with India, which is set to open its own world-class casino next year.

Even Sri Lanka made news because of James Packer’s plan to develop the country’s first world-class resort, as did Taiwan and its proposed Matsu Island casino hub, and Russia with all those talks about developing an entertainment zone in the Primorye region just outside Vladivostok.

And let’s not forget about Japan, which is poised to become one of the biggest markets in the world if its casino legislation is acted on quickly.

Macau continues to rise

Macau’s record gross revenue haul for the year only underscored the city’s already sparkling reputation as the world’s number one gambling destination. As far as competition goes, there really isn’t any considering the continuous record revenues the city’s casinos posted on a per month basis compared to their numbers from a year ago.

From January to November of 2013, Macau has already posted MOP327.29 billion in gross revenues, and that’s with one month left in the calendar year. Convert that to USD and you’re looking at earnings of $42.2 billion, staggering numbers but all that surprising considering the number of people, a lot of whom are of the high-rolller variety, who enjoy their gambling spoils in the only place in China where its legal.

Based on estimates, Macau could earn somewhere around MOP355 billion, which is about $45.8 billion based on current exchange rates.

Yep. In the words of Rod Tidwell, “show me the money!!!”

Atlantic City continues to sink

For all of the gambling money being poured in Macau, the flip side is happening in Atlantic City, once considered the bastion of gambling in the East Coast of the US. Right now, it’s a shell of its old self, and that may even be putting it lightly.

Of the 11 months on record so far, Atlantic City’s overall revenue only saw upticks in October and November and even that comes with a huge asterisk, one we shall call Hurricane Sandy.

For the entire year until November, Atlantic City’s total revenue haul sits at a paltry $2.7 billion, 6.1% from the same period last year. With only a month left to the year and little hope that a Festivus miracle happens for a third straight month, the AC could be looking at a total gaming revenue that falls under $3 billion, the worst showing for the beleaguered casino town in over 20 years. Oh, and by comparison, Macau’s gross revenue figures from November amounted to MOP30.179 billion, which about $3.8 billion, well clear of what Atlantic City’s total for the entire year.

Meanwhile, the opening of the online gambling market should have some positive and negative effects for those casinos in Atlantic City offering it. On the one hand, its a new source of revenue that none of them had at their disposal this time last year. But on the flip side, questions on how online gambling throughout the state will affect the number of people who actually go to the casinos are being floated around – and for good reason. With gambling now legal from the comforts of your own home, why go to AC to enjoy it?

Right now, it’s too early to tell how much online gambling will help or hurt Atlantic City casinos. It’s an interesting quagmire that should be cleared up next year and the years after that.

New York gets its casino expansion

New York governor Andrew Cuomo can now rest easy this holiday season, knowing that all the work he put in to his quest to have more casinos in the state finally reached a positive conclusion this year.

it didn’t come easy, and the governor had to come to agreements with a number of Native American tribes in the state, but after months of negotiating to go with a seemingly endless list of issues that propped up at inopportune times, Cuomo and all those in favor of expanding casinos in the state got what they wanted.

The referendum was approved, which meant that a total of seven full-scale casinos are now in play, opening the proverbial floodgates for operators to take stab at securing a license to develop their own projects in the state. A catch in the referendum means that the state can only give out four casino licenses in the time-being with the other to be determined at a much later date.

But that caveat is inconsequential in the bigger scheme of things. The important thing was that the referendum was approved. Now comes the equally daunting task of choosing among all those interested operators on who gets dibs on those four licenses.