How Much Did Each Gaming Table in Atlantic City Win During October?

The Short Take:

  • Borgata had the highest monthly win per gaming table in October, coming in at over $86,000 per table
  • After only being in business for a few months, Hard Rock had the second highest win per gaming table in October, winning over $53,000 per table
  • Many casinos saw steep decreases in their win per gaming table in October including Harrah’s, Caesars, Bally’s and Golden Nugget

As we discussed in an earlier article, the Atlantic City casinos’ wins from table games increased 16% in October on a year-over-year basis.  Overall, the nine casinos won $56.3 million at their gaming tables during the month.

Another way to look at the table games wins is to look at how much each casino won per gaming table during the month.  To do this we take two numbers that are reported to the state of New Jersey by each casino: the total table games wins for the month and the number of tables in each casino.

Here’s a look at that data:

When we divide the total table games wins by the number of gaming tables at each casino, we see that Borgata (MGM) has, by far, the highest win per gaming table during October.  In fact, its $86,700 of wins per table was over $30,000 more than its next closest competitor.  That competitor happens to be one of the new casinos in town – the Hard Rock.  After just a few months in operation, Hard Rock generated over $53,000 in wins per gaming table during October.

The chart below shows the win per table in October 2018 on the left side versus the win per table a year earlier, October 2017, on the right side:

 

As you can see, many casinos saw their win per gaming table tumble from 2017 to 2018.  This is most likely due to the two new casino openings. Three notable casinos to take a look at are Harrah’s, Bally’s and Caesars.  All three of these casinos are owned by Caesars Entertainment (CZR) and all three saw dramatic declines in their monthly wins per table.  Golden Nugget also saw significant year-over-year decreases.

On the bright side, several casinos did see year-over-year increases in wins per gaming table. Borgata had both the highest win on an absolute basis, but it also increased that win by more than $11,000 per table from October 2017 to October 2018.

Tropicana (ERI) saw significant increases in its wins per table, rising $17,000 per table YoY.  It should be noted that the October 2017 table game wins for the Trop are probably skewed by a run of bad luck since they are significantly lower than usual.  One other casino that saw YoY increase in wins per table was Resorts which is at the lower end of the spectrum and saw its wins per table increase by almost $3,000 per table.

We are really starting to see the effects that the two new casinos are having on some of the legacy casinos.  Some, like Borgata and Tropicana, are holding their own while others like Harrah’s and Caesars are suffering.  All of the casinos will need to be creative to win back and keep their customers from the shiny new casinos on the Boardwalk.

Borgata is the Leader in Wins Per Slot Machine in Atlantic City, but Hard Rock is Making Waves

The Short Take:

  • Borgata had the highest monthly win per slot machine in Atlantic City, with $11,965 won from every machine on average in October
  • All legacy casinos saw a YoY decline in their slot win per machine in October
  • After just a few month of operations, Hard Rock is gaining serious slot market share in Atlantic City. In October it controlled over 10% of the slot wins in the city, with over $7,300 won per machine

In earlier articles we touched on the fact that the Atlantic City gaming market saw an 8% overall increase in casino wins in October 2018 versus October 2017 .  Further, the casinos’ wins just from slot machines jumped 5.3% YoY in October to over $142.5 million.

As you walk into a casino the first thing you see is row after row of slot machines.  So we wondered, if AC casinos made over $142 million in slot wins in October, how much did they win per machine?  We’ve put together those numbers for you and the results on a casino by casino basis may be surprising.

First, an explanation on how we came up with the per slot machine win per casino.  Atlantic City casinos are required to submit a monthly report to the state of New Jersey.  Two figures they must report are the total slot wins for the month and the number of slot machines in the casino.  To calculate the win per slot machine we just divide the total slot wins by the number of slot machines.  Here is the raw data used in the calculation for October 2018:

The table below shows the win per slot machine for October 2018 on the left.  For comparison, we provide the same information from a year ago, October 2017.

 

The clear winner is Borgata, with almost $12,000 in monthly wins per slot machine.  On the downside, Borgata’s October 2018 win per machine decreased by over $1,200 per machine compared to October 2017.  In fact, every casino that was open in October 2017 saw a year-over-year decrease in the monthly wins per slot machine.

The most likely reason for this slot win decline for the legacy Atlantic City casinos?  The recent openings of Hard Rock and Ocean Resort. Hard Rock won over $15 million from its slot machines, or over $7,300 per machine.  After just a few months of opening the doors, Hard Rock controls over 10% of the Atlantic City slot market!

The other newcomer on the Boardwalk, Ocean Resort, is not as large of a threat for the legacy casinos, but it is still another competitor to deal with.  In October, Ocean Resort won $8.2 million from its slots, or 5.8% of the AC market.  By the way, Ocean Resort had the lowest slot win per machine for the month, coming in at just over $4,200 per machine.

When standing in the middle of a casino you can feel like you’re surrounded by slot machines with hundreds or thousands surrounding you.  It’s truly amazing the amount of profit each and every machine makes for the casino!

Atlantic City Casinos Win 16% More YoY at Table Games in October but Many Legacy Casinos Take a Hit

The Short Take:

  • City-wide table game wins at the nine Atlantic City casinos increased 16% in October with $56.3 million in table wins
  • Of the legacy casinos, only Borgata and Tropicana saw year-over-year table games wins increase
  • The new casinos, Hard Rock and Ocean Resort, won a combined $12.8 million from table games
  • All three casinos owned by Caesars Entertainment saw dramatic decreases in table games wins

In October, Atlantic City casinos saw their total casino win increase by 8.0% and their total win at slot machines increase by 5.3%.  So how did the casinos do at their table games?

It turns out pretty well! Total table games wins at the nine Atlantic City casinos came in at over $56.3 million for the month of October. This is a 16.0% year-over-year (YoY) increase compared to October 2017.

In terms of total table games wins, Borgata was the big winner, as usual.  During the month Borgata won $15.9 million from its tables. This is a YoY increase of 12.6%. Borgata’s win at the tables was nearly twice that of its next closest competitor – the newly opened Hard Rock. That’s right, just several months after opening, the Hard Rock is rising to the top of the Atlantic City casino pecking order.

Here’s a look at the October 2018 table games wins compared to the October 2017 wins:

 

While Borgata had the highest wins from table games, the Tropicana was the casino with the largest year-over-year growth.  The Trop’s $5.1 million in wins placed it fifth in terms of total table wins, but it represents a 57.4% increase from October 2017.  You should take this huge growth rate with a grain of salt though.  The Trop’s very low table games win in October 2017 was a rare anomaly, probably due to bad luck with a whale or two.

While table games wins in the Atlantic City market increased year-over-year by 16.0%, Tropicana and Borgata were the only two casinos that had positive YoY growth.  As we mentioned, Hard Rock skyrocketed to the number two winner with $8.1 million in table games wins, and the other new casino in town, Ocean Resort, pulled in $4.7 million from its tables in October. All of the other casinos in town suffered as a result.

All three properties owned by Caesars Entertainment (CZR) saw significant decreases in their table games wins.  The least bad CZR property in terms of YoY declines was Bally’s which saw an annual decline of 24%. Harrah’s win dropped an amazing 32.2% while Caesar’s fell 33.2%. These are not good numbers at all, but they are also in line with what we saw on the annual slot wins for these CZR casinos.

CZR properties were not the only casinos in town that suffered.  Resort’s table games wins fell 4.2% year-over-year.  Even worse, Golden Nugget saw a huge annual decline of 30.2%.

Here’s a look at the October 2018 year-over-year changes in table games wins for the legacy Atlantic City casinos:

 

While it is encouraging that the overall Atlantic City gambling market is expanding in terms of casino wins, resorts and jobs, the steep declines at some of the legacy casinos we’ve seen after the openings of Hard Rock and Ocean Resort are alarming.  Are gamblers just checking out the new kids in town and then will go back to their old casino of choice, or are the two new casinos, especially Hard Rock, stealing these customers for good?  Time will tell and we here at Ante Research will bring you updates every month!

Internet Gambling in New Jersey Up 30%; Golden Nugget Leads the Way

The Short Take:

  • Total internet wins for the seven Atlantic City casinos that offer internet gambling in New Jersey totaled $26.75 million during October, a 30.1% year-over-year increase
  • The leader in internet gambling in New Jersey is the Golden Nugget.  Its $9.7 million in wins during the month was a 57.6% annual growth rate
  • Two relative newcomers to internet gambling in New Jersey are Hard Rock, which had $1.0 million in wins, and Ocean Resort with $600 thousand in wins

In October, the seven Atlantic City casinos that offer internet gambling within the state of New Jersey won over $26.75 million.  This was up 30.1% over the total wins in October 2017.

Leading the way was the Golden Nugget.  During the month, the Nugget won $9.7 million from its internet gambling websites (see the end of this article for a list of the websites that the AC casinos operate). This was a huge 57.6% year-over-year increase over the same month last year.

 

Borgata had the second highest internet gaming win in New Jersey, but it was well less than half of the Golden Nugget’s.  During October Borgata won $4.4 million.  Borgata’s win grew a less substantial, but still very respectable, 4.4%.

The three remaining casinos that have been in operation for at least a year won in the upper $3 million range.  Caesars’ $3.9 million in internet wins was a very healthy 18.0% YoY gain.  Tropicana’s 7.0% annual gain translates into $3.7 million in internet wins in October.  Finally, Resorts secured $3.5 million in wins through its gaming websites, a YoY growth rate just positive, at 0.3%.

 

Hard Rock and Ocean Resort were not open in October 2017, so we do not have year-over-year growth numbers, but we do have October’s wins for each.  These casinos’ websites brought in the two lowest wins during the month, but they were still decent showings for newcomers.  Hard Rock won $1.0 million and Ocean Resort won $600 thousand during the month.  Without a doubt, these figures will increase in the coming months as their gambling websites gain traction.

Internet gambling in New Jersey is growing stronger!  The Atlantic City casinos that offer online gambling to people in New Jersey are reaping the benefits.

Here is a list of the websites that each of the seven AC casinos operated as of the end of October 2018:

Borgata

www.BorgataCasino.com

www.BorgataPoker.com

www.NJ.PartyPoker.com

www.PalaCasino.com

www.playMGMcasino.com

www.playMGMpoker.com

 

Caesars

www.CaesarsCasino.com

www.HarrahsCasino.com

www.WSOP.com

www.888.com

 

Golden Nugget

www.goldennuggetcasino.com

www.betfaircasino.com

www.playsugarhouse.com

 

Hard Rock

www.HardRockCasino.com

 

Ocean Resort

www.OceanOnlineCasino.com

 

Resorts

www.ResortsCasino.com

www.MoheganSunCasino.com

www.PokerStarsNJ.com

 

Tropicana

www.TropicanaCasino.com

www.VirginCasino.com

Atlantic City Casinos See 5.3% Increase in Slot Wins in October, But Most Casinos Down

The Short Take:

  • Atlantic City’s city-wide slot wins increased by 5.3% in October
  • Every legacy casino saw year-over-year decreases in slot wins in October due in large part to the arrival of Hard Rock and Ocean Resort on the scene
  • Borgata, as usual, had the highest slot wins with $33.8 million.  Ocean Resort had the lowest with $8.2 million in slot wins
  • On a year-over-year growth basis, Harrah’s performed the worst, with its slot wins sliding 17.8% YoY

While the city-wide total casino slot wins increased by 5.3% in October 2018 versus October 2017, the majority of casinos are not seeing this as good news.

The introduction of Hard Rock and Ocean Resort caused the slot wins at all of the other legacy casinos to drop dramatically.  In fact, every single legacy casino saw their slot wins decrease.  This decrease in slot wins for the legacy casinos is very similar to their drop total casino wins that we discussed in an earlier article.

 

Among the legacy casinos, Golden Nugget fared the best, but the Marina casino still saw its October slot wins decrease by 1.5% compared to October 2017.  Tropicana, Resorts and Bally’s had moderate YoY declines in their slot wins, ranging from the mid to high single digits.  The real losers were Caesars (down 15.0%), the seminal AC leader Borgata (down 15.5%) and Harrah’s (down 17.8%).

While Borgata’s slot wins were down 15.5% year-over-year, it is still the leader in Atlantic City.  Its October slot wins of $33.8 million were almost $14 million more than the second place Tropicana which won $19.9 million from its slots.

The chart below shows the October 2018 slot wins for each Atlantic City casino on the left compared to the October 2017 wins on the right.

 

The new guys in town had mixed results.  Hard Rock was ranked fourth in total slot wins in October.  Its $15.1 million placed it between Harrah’s $18.3 million and Caesars’ $14.1 million.  Ocean Resort, on the other hand, came in last in slot wins.  Its $8.2 million was more than a million less than Bally’s $9.5 million in slot wins.

As we can see, the expansion of gambling in Atlantic City, especially the opening of the Hard Rock, is taking its toll on the legacy casinos.  Even though the broad market is increasing, with city-wide slot wins up over 5% YoY, that increase is being absorbed, and then some, by the Boardwalk’s two new casinos.

Atlantic City Total Casino Wins Grows 8%; Legacy Casinos’ Wins Drop

The Short Take:

  • October total casino wins city-wide increased 8.0% year-over-year in Atlantic City, coming in at over $200.6 million
  • The two newcomers in town, Hard Rock and Ocean Resort, had combined casino wins of $36.3 million in October
  • All of the legacy casinos saw their casino wins YoY growth rates in negative territory with the exception of Tropicana
  • Ocean Resort had the lowest casino win in Atlantic City while Harrah’s had the largest decline on a year-over-year basis

October 2018 saw an 8.0% increase in total casino wins at Atlantic City casinos, versus the wins in October 2017.  But for the legacy casinos, the openings of Hard Rock and Ocean Resort spelled trouble.

Casino wins for all Atlantic City casinos surpassed $200.6 million for October 2018.  Compared to October 2017’s $185.8 million, AC saw its casino wins increase by 8.0%.  The newcomers on the scene, Hard Rock and Ocean Resort, had a combined $36.3 million in wins for the month.  These wins definitely came at the expense of the legacy casinos in town.

In fact, all but one legacy casino had significant year-over-year decreases in casino wins. The only casino to show positive YoY wins was Tropicana.  The Trop’s monthly wins increased by just 2.1% compared to October 2017.  Resorts, Borgata and the Golden Nugget had YoY casino wins drop in the high single digits.

The three worst performing Atlantic City casinos based on year-over-year declines in casino wins were the three properties owned by Caesars Entertainment (CZR).  Bally’s saw a decrease of 14.7% while Caesars’ casino wins dropped 21.4% YoY.  Harrah’s was the worst performer in town.  Its casino wins fell 21.7% in October 2018 compared to October 2017.

Here’s a look at the year-over-year growth rates at all of the legacy casinos.  Hard Rock and Ocean Resort are not in this chart because they were not in business in October 2017.

 

The chart below shows the clear downward spiral of casino wins for each legacy Atlantic City casino since Hard Rock and Ocean Resort entered the scene.  The left side of the chart shows the total casino wins for each casino in October 2018 while the right side shows the same for October 2017, one year earlier.

 

Borgata is still, by far, the clear leader in the city.  Its $50.7 million in casino wins in October was more than double the next closest casino, the Tropicana, which had $25.2 million in wins.  While Harrah’s casino win fell 21.7% YoY, it is still ranked third in Atlantic City with $23.8 million.  Harrah’s just barely beat out Hard Rock’s $23.2 million in casino wins.

While Hard Rock is making a splash in the Atlantic City casino scene, Ocean Resort is not performing nearly as well.  Ocean Resort was dead last in total casino wins in October in Atlantic City.  It’s $13.1 million in wins was $700 thousand less than the much smaller Resorts and $1.3 million less than Bally’s.

While it is great that casino wins city-wide increased by 8% in October, the legacy casinos definitely have their work cut out for them to make sure that Hard Rock and Ocean Resort don’t continue to eat into their casino business.

Las Vegas Revenue Falls 4.6% on Average at Six Major Casino Companies in Q3

The Short Take:

  • Combined, six major gaming companies brought in $3.8 billion of revenue from their Vegas operations which is a 4.6% year-over-year decrease
  • Out of the six companies in this study, only one, Red Rock Resorts, posted YoY increases in Vegas revenue
  • Wynn Resorts was the worst performing company in terms of Vegas revenue in this study, seeing its Las Vegas revenue falling 14.1% YoY

With the third quarter results of the most of the large casino companies now in the rear-view mirror we decided to take a look at how each company performed in Las Vegas.  Many of the companies report separate revenue line items for their Vegas operations.  Others, like MGM do not, but they do provide revenue per property which we used to produce the Vegas revenue results.

As expected, MGM Resorts (MGM) was the top player in Vegas in terms of net revenue during the third quarter of 2018.  MGM’s total net revenue for the nine casinos it operates on the Strip totaled over $1.45 billion.  In second place, Caesars Entertainment (CZR) squeezed out $910 million in revenue from its Vegas locations.

Wynn Resorts (WYNN), Red Rock Resorts (RRR) and Las Vegas Sands (LVS) all had very similar total Vegas revenue in the third quarter.  Their net revenue was in the upper $300 million range.  Boyd Gaming (BYD) brought in almost $268 million through its two Vegas revenue segments: casinos that cater to Las Vegas locals and its downtown Vegas properties.

Here’s an overview of the Las Vegas revenue by company for the third quarter of 2018:

 

While these revenue numbers seem impressive, all but one of these companies saw year-over-year decreases in its Vegas revenue.  Several saw dramatic decreases.

The only company on this list that grew its Vegas revenue was Red Rock Resorts which owns or partially owns 20 casinos in town including the Station casinos.  Red Rock’s Las Vegas revenue rose 3.9% year-over-year compared to the third quarter of 2017.  Boyd Gaming’s Vegas revenue just missed a YoY breakeven, falling 0.2%.

Las Vegas Sands and Caesars Entertainment saw modest YoY Vegas revenue decreases.  Las Vegas Sands’ was down 2.1% YoY while Caesars’ declined 2.4%. MGM Resorts fared worse.  Its local properties’ revenue sank 6.5% YoY.

The worst performing company in terms of YoY growth of Vegas revenue was by far Wynn Resorts.  Maybe this had something to do with the turmoil that occurred in the executive boardroom with the ouster and public flogging of ex-CEO Steve Wynn, but regardless of the reason the 14.1% YoY decrease in net revenues at the company’s two Vegas resorts was astounding.

Here’s a look at the YoY growth of each companies’ Las Vegas revenue:

All-in-all, the third quarter Las Vegas revenue for these major players was disappointing.  Taking in aggregate, all six companies discussed in this article produced about $3.8 billion in Vegas revenue during the quarter. This was a fairly substantial decrease of 4.6% compared to Q3 2017.   Here’s to hoping that the fourth quarter results are better for Vegas!

MGM Domestic Revenue Fell 1.6% YoY in Q3; Casino Revenue Up Slightly

The Short Take:

  • MGM Resorts’ Q3 2018 domestic revenue fell by 1.6% compared to the same quarter last year
  • The only domestic revenue segment that saw a YoY increase was Casino revenue, which rose by a tiny 0.5%
  • The worst performing domestic revenue segment was Rooms which fell 4.6% YoY

In the third quarter of 2018, total domestic revenue at MGM Resorts declined 1.6%, from $2.267 billion in Q3 of 2017 to $2.231 billion in Q3 2018.  MGM breaks down domestic revenue into four segments: Casino, Rooms, Food & Beverage and Entertainment & Retail.  We’ll take a look at how each segment drove total domestic revenue.

Q3 2018 MGM Domestic Revenue by Segment:

Casino revenue was the only domestic revenue segment that saw a YoY increase in Q3 2018.  And it was a very slight increase – just 0.5%. The $871,974 million in casino revenue was up $4.45 million compared to the same quarter last year.  This year, the casino revenue made up 39.1% of the quarterly domestic revenue.

Q3 2018 MGM YoY Growth of Domestic Revenue by Segment:

All three remaining domestic revenue segments saw YoY decreases.  The segment with the smallest decline was Entertainment & Retail. This segment saw a 1.5% decline compared to last year, coming in at $533,629 million.  This was a $5.23 million decline versus 2017.  Entertainment & Retail made up 15.4% of total domestic revenue during the third quarter.

Food & Beverage did slightly worse.  This domestic segment’s revenue fell $8.85 million compared to the same quarter last year, but on a percentage term the segment fell -1.8%.  21.6% of total domestic revenue came from Food & Beverage in Q3.

The worst performing domestic revenue segment in Q3 2018 was the Rooms segment.  Rooms revenue fell 4.6% year-over-year.  The Q3 Rooms revenue totaled $533.6 million, a $25.88 million fall from Q3 2017.  23.9% of total domestic revenue is generated by the Rooms segment.

All-in-all we saw disappointing domestic performance for MGM on the revenue front. What makes things slightly worse is that the results for Q3 2018 include several weeks of revenue from the newly opened MGM Springfield which was not in operation in Q3 2017.  Without the revenue from Springfield included this year, then the YoY comparisons would have been even worse.

How Much Does a Casino Company Make from Gambling?

The Short Take:

  • Local gaming companies like Penn National Gaming get the vast majority of their revenue from gambling. People go to their locations to do one thing – gamble
  • Companies with the majority of operations in Asia (Wynn Resorts and Las Vegas Sands), specifically Macau, also get a large portion of their revenue from gambling due to the volume of gamblers and high rollers
  • Gaming companies such as MGM and Caesars that have a dominant presence in destination locations like Las Vegas and Atlantic City get a smaller percentage of their revenue from gambling.  Other amenities such as dining, shopping and shows are big draws for these locations

In the good ‘ole days, casinos were just that.  Big rooms filled with slot machines, blackjack tables and crap pits.  Sure, there was a restaurant or two and some shows, but these amenities were just there to keep the players in the building.

Today, many casinos resorts are much more.  They are filled with amazing restaurants from celebrity chefs, some of the highest end malls in the country and gigantic venues where the world’s top singers and comedians hold residencies.

That got us wondering, how much does a casino company make from gambling these days?  For many people, the restaurants, shows and great hotel accommodations are the draw to Vegas and other destination areas, but in their hearts these gaming companies still exist to draw you into the casinos.

To get an idea of how much gaming companies make from their casinos, we looked at the total revenue of six large companies and then figured out the percentage of that total revenue that comes from gambling.  As you’ll see, the percentages of total revenue that comes from the casino varies greatly by company.  All data used is as of the 9/30/18 quarter with the exception of Wynn.  Wynn data is as of the 6/30/18 quarter.

The two gaming companies with the highest percentage of total revenue originating from their casinos are Penn National Gaming and Boyd Gaming.  These two companies operate smaller casinos in local markets around the U.S. and casinos in Vegas that cater to locals.  Penn National gets 81.9% of its total revenue from its casinos while Boyd gets 73.0%.

It’s no surprise that the vast majority of revenue comes from casinos for these two companies.  Their properties typically do not have the high-end dining and shopping, or the headline shows.  Their customers go to these casinos for one thing – to gamble.

Overview of the percentage of casino revenue as a percentage of total revenue for six of the top gaming companies:

The next two companies on the list also get a huge percentage of their revenue from gambling, but for different reasons than Boyd and Penn National.  Las Vegas Sands and Wynn Resorts both have Las Vegas casinos, but their bread and butter are their operations in Asia, specifically Macau.

While the Vegas resorts owned by both Wynn and LVS are filled with top shelf dining and shopping, their Asian casinos are geared much more to gambling.  Many people arrive by junket with their sole goal being gambling for the day.  Even though there are top level amentias, shows and dining at these facilities, the vast number of people, and the huge number of high rollers, that gamble at these casinos prop up the casino revenue which overwhelms all of the other revenue segments. As a result, company-wide, Las Vegas Sands gets 71.6% of its revenue from gambling and Wynn Resorts get 68.5%.

Percentage of total revenue that comes from gambling:

 

Finally, Caesars Entertainment and MGM Resorts get the least of their revenue from gambling out of the six companies we looked at, around 50% each.  Caesars does not have casinos in Macau and its many casinos in both Las Vegas and Atlantic City provide many non-gaming options like fine dining and amazing shows.  MGM does have operations in China, but unlike Wynn and Las Vegas Sands, the vast majority of its revenue comes stateside.  These domestic resorts pull in much more non-gaming revenue than the Asian resorts.

While these gaming companies typically do not break down their revenue by gaming and non-gaming on a location-by-location basis, the aggregate data they provide can lead us to some pretty solid conclusions:

  • Casinos in destination areas in the United States such as Vegas, and to a lesser extent Atlantic City, receive less revenue from gambling as a percentage of their total revenue since their non-gaming amenities are such a huge draw.
  • Local casinos throughout the U.S. are mainly draw day-trippers who go just to gamble. 
  • Asian properties are also heavily focused on gambling and the whales that play at these casinos generate so much revenue for the casinos that even the high-end amenities are overwhelmed by the casino revenues.

So the next time you’re in Vegas or your local casino, look around at all of the amenities that are offered, but be sure to know that the company really wants you to stay seated at the slot machine or gaming table.

Caesars Entertainment’s (CZR) Q3 REVPAR Falls 4.72%; Vegas Properties Down 3.57%

The Short Take:

  • Enterprise-wide RevPAR at CZR came in at $123.06 in Q3, a YoY decrease of 4.72%.
  • RevPAR at its Vegas hotels was 130.50, down 3.57% YoY. 
  • Non-Vegas hotel RevPAR declined 7.16% to $109.45.

When Caesars Entertainment (CZR) issued their third quarter 2018 report it contained some disappointing data on RevPAR (Revenue Per Available Room) as well as hotel occupancy.

Enterprise-Wide

Enterprise-wide, the company’s Q3 2018 RevPAR was down year-over-year by 4.72% compared to the same quarter in 2017.  The revenue per room at all of the CZR hotels combined came in at $123.06 versus $129.15 in Q3 2017.

Related to RevPAR, the average daily rate (ADR) was also down for the quarter.  Occupancy, too, was lower.  Enterprise-wide occupancy for Q3 was 91.8%.  A year earlier occupancy stood at 94.6%.

Las Vegas

RevPAR at the CZR Las Vegas hotels was both higher on a dollar value and smaller on a YoY basis. The Q3 RevPAR for the Vegas hotels came in at $130.50 which represents a 3.57% decline over Q3 of 2017.

While RevPAR was lower, the ADR ticked slightly higher at the Vegas hotels – read about CZR ADR here. Occupancy, on the other hand, dropped sharply in Las Vegas.  The combined portfolio of CZR Vegas hotels saw the third quarter occupancy rate decline from 96.1% last year to 92.6% this year.

Other U.S. Properties

Caesars combines all properties outside of LasVegas into a category it calls All Other U.S.  The largest group of hotels in this category is probably its three Atlantic City properties, but it also contains every other hotel it operates in the U.S. outside of Vegas.

The RevPAR for this non-Vegas group had an even worse decline than the Vegas properties.  The Q3 YoY slide was 7.16%, dropping from $117.89 last year to $109.45 this year.

Like RevPAR, ADR for the non-Vegas hotels dropped.  So did the occupancy rate.  The Q3 occupancy was 90.2% for the quarter.  This was down from 91.8% for the same quarter last year.

Here are a couple of charts that show the RevPAR for CZR as well as the Q3 2018 / Q2 2018 YoY RevPAR change:

 

Caesars’ Competitors

Caesars’ Las Vegas competitors also had a rough quarter in terms of RevPAR.  Las Vegas Sands saw its RevPAR decline 3.2% at its Las Vegas hotels. The LVS RevPAR was $213 for Q3 in Las Vegas.

Maybe a better comparison for CZR is MGM which has a more complimentary portfolio of properties in Vegas. MGM’s Las Vegas Strip hotels had a combined RevPAR in Q3 of $146, a bit higher than CZR but their portfolio of hotels may be a bit higher-end.  But MGM’s YoY RevPAR growth was worse than Caesars’, coming in at -3.9% versus last year.

Overall, the hotels owned by CZR, as well as by LVS and MGM, had a difficult quarter in Las Vegas and the rest of the United States.  We’ll be keeping an eye on all of the casino and hotel stats, so bookmark us and come back soon!