Nevada’s casino industry is beginning to recover from Sept 11, showing a significant increase in statewide gambling revenues. Yet analysts on Wall Street remain tentative.
Compared with last year the revenues seem healthy, but analysts are sharply aware of the toll the terrorist attacks took on the industry. The biggest indication that casinos still haven’t quite found their feet is the telling lack of high rollers. Tourist travel remains low, keeping them from returning in force. In fact since September 2001 baccarat revenues are decidedly down, sliding 32 percent statewide.
Gaming equities analyst with Deutsche Bank Securities, Marc Falcone, expresses his disappointment: “Given a fairly strong special event calendar, which included the De La Hoya-Vargas fight (at Mandalay Bay), we would have expected a stronger turnout in the market from high-end table customers, particularly against easy 9-11 comparisons.”
A comparison with September 2000 of the total amount wagered – or “total drop” – shows a decline of 6.1 per cent. This has been put down to the emphasis casinos have since put on encouraging the attendance of convention goers in an attempt to bolster occupancy and room rates. Bond analyst John Kempf, of Goldman, Sachs & co: “The convention segment is traditionally a weaker gaming customer.”
Nevertheless recovery is being made. Even Falcone has a positive outlook for the near future: “A pickup in convention activity and a strong special events calendar should improve the outlook for Las Vegas.”…