Operator News
US – Nevada’s casinos break revenue record in 2017
By Phil - 15 January 2018
Ten years after the start of the recession, Nevada’s biggest casinos can finally announce that they are back having not only turned a profit for the second year running but also having finally broken the revenue record set in 2007 before the economy plummeted.
The state’s largest casinos generated income of US$1.6bn from total revenue of $26.2bn over the fiscal year that ended June 30.
The Nevada Gaming Control Board reported that income from the state’s 272 casinos was 59 per cent higher compared with the previous fiscal year, while revenue was up 3.7 per cent.
Michael Lawton, senior research analyst for the board, said: “So, 10 years later, we’ve finally surpassed that FY07 revenue amount, and the key driver of that is your non-gaming revenue. Gaming revenue has grown, but it’s still well below the peak.”
He added: “After recording seven consecutive net loses, the state has recorded two consecutive years of income. The results were driven by the Strip. The state’s net income increased by $578.4m and the Strip’s net income increased by $534.6m of that total, or 92.4 per cent. And the total revenue for Nevada was up $939.8m, and the Strip contributed $660m or 70.2 per cent of that increase.”
The annual report called the Gaming Abstract includes stats about Nevada casinos that grossed $1m or more in gambling revenue.
It outlined that 72.5 percent of total gambling revenue came from 62 casinos owned by publicly traded companies. Gambling accounted for 42.4 percent of total revenue, down slightly from last year’s 42.6 per cent.
Perhaps most interestingly, gambling revenue only accounted for 34 per cent of the Strip’s total revenue.
“It represents the lowest percentage ever recorded,” Mr Lawton explained: “What that means is that rooms, food, beverage and other, that accounted for 57.6 per cent of total revenue, which is the highest combined share ever recorded in the abstract. This was the last time gaming accounted for greater than 50 percent of the statewide total.”
“Gaming did not have a bad year. In fact, it had a good year and a nice increase, but definitely not record levels like nongaming spending. revenue was $11.1bn, a 3.3 percent increase or $349.2m difference compared to 2016,” Mr Lawton added. “But gaming revenue accounted for 42.4 per cent of that, down from last year’s 42.6 percent. On the other hand, rooms, food and beverage accounted for 57.6 per cent of revenue, the highest combined share recorded in the abstract’s history, up from last year’s number of 57.4 per cent.”
Mr Lawton said GGR has increased during six of the last seven years, surpassing $11.1bn in 2017, but it remains 11 per cent below 2007 levels.
On the Las Vegas Strip, casinos won $814m and generated GGR of $17.8bn. This profit meant a jump of 191.4 per cent compared with 2016.
The abstract also highlighted how Downtown Las Vegas performed well. “The abstract paints a good picture for that area,” he said. “We had a new property but that’s not the only driver. Downtown Las Vegas did $1.2bn in total revenue, an all-time record for them as well.”
