Casinos suffered big revenue decline in February

Tuesday, April 14, 1998 | 11:41 a.m.

CARSON CITY -- Nevada casinos suffered their biggest decline in gambling revenue in February in nearly a decade, the state Gaming Control Board reported today.

Casinos statewide won $588.2 million, or a 7.3 percent decrease compared to the same month of 1997. "It wasn't a good month for the state and for most of the markets," said board spokesman Russell Guindon.

There hasn't been that big of a percentage drop in gross revenue since 1989, he said. On the Las Vegas Strip, the win fell by 15.8 percent and in the downtown market, it was down 4.7 percent.

Wall Street showed no immediate signs of panic in reaction to the report, though Wall Street is worried about an oversupply of hotel rooms and gaming capacity in Las Vegas.

Early this afternoon, Hilton stock was up 7 / 8 to 33 and Mirage Resorts Inc. was up 1/16 to 23 1/16. MGM Grand was unchanged at 34 15/16 and Circus Circus Enterprises was down 1/2 to 19 9/ 16.

Two things contributed to the poor performance, Guindon said. Chinese New Years, which draws high rollers to Nevada, fell in January this year. It was celebrated in February in 1997. And the poor weather in northern Nevada discouraged tourists from California, hurting Reno and South Lake Tahoe casinos.

"The weakness was on the game and table side which was down 25.2 percent or $65 million. The state slot win was up 4.9 percent," Guindon said. A big chunk of that drop can be attributed to baccarat, which registered a 59.4 percent decline in the gross win, or $46 million less than a year ago.

"It's the high-end play," concurred Joe Milanowski, a gaming analyst in the Las Vegas office of USA Capital. "Last year, baccarat was OK, but this year it wasn't. It's so volatile that it's hard to predict what it's going to do."

A good part of the increase in the slot win can be attributed to Megabucks. Players were chasing the big jackpot, which has now climbed to more than $15.2 million.

Casinos along the Las Vegas Strip reported a gross win of $276.2 million, compared to $328.1 million of a year ago, its worse percentage decline in a number of years. For the last four months, clubs on the Strip have been showing strong growth.

Slot machine play in February rose by 4.1 percent but the game and table win fell by 31 percent. Winnings on the baccarat tables on Strip casinos dropped 57 percent; play on 21 declined by 23.5 percent but craps revenue rose by 17.4 percent. Pai Gow, a game favored by Asians, dropped 41 percent.

After a strong 8.4 percent increase in revenues in January, downtown Las Vegas casinos reported $51.8 million in gross revenue, off 4.7 percent. The slot machine win increased by 3.9 percent but game and table win was off 27.5 percent.

The clubs in "Glitter Gulch" actually lost $1.3 million on the baccarat games. The board said win on the 21 games rose by 13.1 percent but the volume on craps was down nearly 40 percent.

Two of the bright spots in Clark County were in North Las Vegas and on the Boulder Strip.

North Las Vegas casinos posted a win of $15.6 million, up 24 percent."They are doing very well," Guindon said. "Slot win was up 26 percent and game and table win increased by 11 percent."

Casinos along the Boulder Strip reported $43.2 million in win, up 40.6 percent from a year ago. Guindon said however that's due in part to the addition of the Sunset Station and the opening of the Reserve in February. Slot win rose by 45 percent and game and table win was up 14.9 percent.

For the third straight month, gambling win in Laughlin declined. The board said casinos reported gross revenue at $41.6 million, off 2.6 percent. Slot machine revenues fell by 1.9 percent and table play was off 6.2 percent.

The board said gross revenue for casinos in Washoe County fell to $64.9 million, down 8.7 percent. There were chains or snow tires required over the mountain passes leading from California into Reno and South Lake Tahoe 21 of the 28 days, he said.

Slot win in Washoe County was off 6.3 percent and table game revenue fell by 14.6 percent.

South Lake Tahoe casinos registered $16.1 million, off 15.7 percent. Slot win fell by 15 percent and game and table revenues were off 16.4 percent.

Elko County casinos posted a 7.1 percent decline with $15 million in gross win. The Carson Valley area, which includes Carson City and the Minden-Gardnerville area, was the only major area in northern Nevada to show an increase. It reported $5.3 million in revenues up 2.9 percent.

The board reported that so far this fiscal year, it has collected $323.1 million in casino taxes for a gain of 1.9 percent for the nine-month period. That's below the 5.4 percent increase predicted for building the state's budget.

For the first two months of this calendar year, Guindon said total win statewide was $1.2 billion, or off one-tenth of a percent. On the Strip, win totaled $1 billion, or down 5.1 percent from the first two months of 1997. Downtown Las Vegas clubs have posted a 2.1 percent increase in revenue to $115.4 million in the first two months.

North Las Vegas win was up 13.4 percent; Laughlin off 2.2 percent and the Boulder Strip up 31.5 percent.