Calendar quirk behind 15% decline in state gaming win

Cy Ryan and David Strow

Wednesday, March 13, 2002 | 11:05 a.m.

Nevada casinos suffered the worst single-month downturn in gaming win in nearly 20 years in January, the state reported today. Experts blame a quirk in the calendar for the sharp decline, though gaming win has suffered since the tourism slowdown caused by the September terrorism.

The state Gaming Control Board reported today gross win statewide fell to $766.3 million in January, down 14.8 percent. On the Las Vegas Strip, gaming win was down 23.9 percent to $377.8 million. Both declines were the worst since 1983.

But state officials and analysts had one mantra this morning -- this decline was no surprise. Both the Chinese New Year's holiday and the Super Bowl fell in January 2001. In 2002, both moved into February.

"This was not unexpected," said Frank Streshley, senior research analyst for the Control Board. "The Super Bowl is one of the top events on weekends. The Chinese New Year draws the high end players."

Larry Klatzkin, gaming analyst with Jefferies & Co., said that despite the big decline, the January report could mark the bottom of the downturn.

"You've already heard from everybody about February, and everyone's saying it's better," Klatzkin said. "It seems like it's turned, and this is maybe old news.

"This is not good news, but I'm not putting it down as a disaster, either."

The post-Sept. 11 slowdown may have been a factor in January, but the calendar quirk was a far larger factor, said Bill Lerner, gaming analyst with Prudential Securities.

"If we were able to strip out Chinese New Year's and Super Bowl impact, the number would have been slightly better than people expected," Lerner said. "Clearly we're not back to where we were ... but we're farther along than many thought we'd be at this stage."

To get a clearer picture, Streshley said the board will wait for February's figures so the two months can be taken together. And he said preliminary reports from casinos are that February was a fairly good month.

Because of the shift of the two holidays, Klatzkin said it's possible that February gaming win could be even with last year's levels, or even up over last year.

"If you take January and February combined, and then you see a major decline, then I'd be concerned," Klatzkin said. "If February comes in down 5 percent, I'd be upset."

Both Chinese New Year and the Super Bowl attract high-end players to Las Vegas, and high-end players are typically attracted to table games. So it wasn't surprising, then, that table game revenue statewide was down 36.6 percent to $137.7 million. Baccarat, the table game of choice for high-end players, was down 44.8 percent; blackjack was down 33.4 percent; craps declined 39.6 percent; roulette was off 31.9 percent; and sports book win dropped 29.7 percent.

But slot play showed signs of strength in January, rising 0.9 percent, or $4.9 million, for the month.

"This is the first positive growth in slots since September which is a good sign things are starting to slowly recover," said Streshley.

Casinos along the Strip reported $377.8 million in January gaming win, down from the $496.7 million in January 2001. If the Strip is excluded from January's gaming win report, the state's decline is only 3.6 percent.

January marked the fourth straight month that gaming win fell by 10 percent or more on the Strip.

Table game win fell by 43.1 percent or $126 million at Strip casinos. Baccarat was off 44.7 percent; blackjack was down 44.5 percent; craps declined 48.4 percent; and roulette fell by 37.4 percent. However, sports book revenue rose modestly, posting a 2.6 percent increase.

Slot trends were far more encouraging. In January the Strip's slot win rose 3.8 percent, the first increase since September.

Downtown Las Vegas casinos reported $54.2 million in gross win, which is computed before taxes and business expenses. That's down 10.2 percent from January 2000. Table revenue was off 13.3 percent and slot win fell 9.1 percent.

North Las Vegas clubs registered a gross win of $18.4 million, down 7.9 percent. Slot win fell 4.5 percent and table win dropped 30.9 percent.

Laughlin casinos had $49.4 million in gross win, off 5 percent. Slot win fell 3.2 percent and table revenues dropped 15.5 percent.

The Boulder Strip was one of the few places in the state that registered higher winnings -- win on the Boulder Strip rose 7 percent to $61 million. This may have included revenue from Green Valley Ranch Station Casino, which opened in Henderson in December 2001.

Slot win on the Boulder Strip rose 8.5 percent, but table revenues were down 1.9 percent.

The balance of Clark County reported $71.6 million in casino win, up 0.6 percent. Slot win rose 1.9 percent but table game win was down 5.3 percent.

For the first eight months of this fiscal year, the state's casinos have paid $345.7 million in taxes, down 3.3 percent from a year ago. The Economic Forum had predicted an increase in taxes of nearly 4 percent this fiscal year. So tax collections are lagging by more than 6 percent.

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