Each week, CasinoBeats breaks down the numbers behind some of the industry’s most interesting stories. Sales of Encore Boston Harbor and Crown Resorts, financial performances in the US and New Zealand, and a BGC black market warning, all feature in our latest look back at a selection of last week’s headlines.
Crown Resorts is working to “build momentum on our company-wide reforms” in a bid to advance “multiple regulatory processes,” following a H1 ending December 31, 2021, that reflects “continued challenging operating conditions”.
Citing the impacts of ongoing regulatory matters, as well as COVID-19 mitigation measures, the embattled Australian casino operator reported a H1 loss of A$196.3m, which widened from the A$120.9m posted one year earlier.
The company, which earlier in the week agreed to a A$8.9bn (US$6.3bn) takeover by Blackstone, secured statutory revenue of A$778.6m, up 34 per cent year-on-year, with EBITDA closing the period at a loss of A$47.5m, down from a profit of A$4.4m year-on-year.
“While we do not underestimate current headwinds facing Crown, there is growing confidence we have turned the corner,” noted Steve McCann, Crown’s Managing Director and Chief Executive Officer.
Wynn Resorts is to divest all of the land and real estate assets of Encore Boston Harbor to Realty Income for $1.7bn, which represents a 5.9 per cent cap rate.
The company, which has heaped praise on the additional financial flexibility to be gained via the transaction, will also enter a triple-bet leaseback agreement upon closing.
This will have an initial total annual rent of $100m and a term of 30 years, with one thirty-year tenant renewal option. Rent will escalate at 1.75 per cent for the first ten years, and the greater of 1.75 per cent and the CPI increase during the prior year (capped at 2.5 per cent) over the remainder.
Encore Boston Harbor, located on the Mystic River less than five miles from downtown Boston, debuted to much fanfare in June 2019 at a cost of $2.6bn.
Traditional brick-and-mortar gaming led the recovery of the US industry through the past year, with the 12 month period setting a record as the highest gross for the region’s commercial gaming ecosystem.
This, according to the American Gaming Association‘s Commercial Gaming Revenue Tracker, saw revenue of $53bn reached, which surpassed 2019’s previous high of $43.65bn by 21 per cent.
On a national level, every commercial gaming vertical set annual revenue records, while 23 of the 34 operational jurisdictions also soared to all-time highs through the year.
The industry closed the year on a high note, setting a quarterly revenue record in Q4 2021 of $14.31bn to eclipse the previous best of $13.93bn set one quarter earlier.
The Betting and Gaming Council urged government ministers to “learn lessons” from across a slew of European jurisdictions, amid a warning that the UK is “at a dangerous crossroads” when it comes to black market concerns.
This came amid publication of industry research by PwC, commissioned by the BGC, as the government continues work on the much anticipated gambling review.
The exploration of comparable regions said that black markets in Norway, France, Italy, and Spain now account for 66 per cent, 57 per cent, and 23 per cent, of all money staked.
Furthermore, warning of a potential nine per cent uptick in black market share has also been suggested in Denmark, with much reported issues within Sweden also alluded to.
The Dutch Gaming Authority, Kansspelautoriteit, issued further online licenses for the provision of operations within the country, a move which sees JVH gaming and entertainment strengthen its foothold within the digital ecosystem.
The group, which secured a licence for its Joi Gaming subsidiary in November 2021 for its online casino jacks.nl, has subsequently added a further pair of approvals for Joi I and Joi II.
The Ksa adds that while these form part of the same group of companies as Joi Gaming, it is not yet known which domain names are going to be operational within the country as yet.
Furthermore, the Ksa also issued a short statement confirming that it had granted a remote gambling licence to ZEbetting & Gaming Nederland.
Online casino represents “a significant long-term growth opportunity” asserted SkyCity Entertainment Group, as the firm reflected on its performance through the six months to December 31, 2021, that was “extensively” impacted by COVID-19.
SkyCity said that its first half of the 2022 financial year proved to be “another challenging period” driven by “significant COVID-19 disruptions,” particularly in Auckland where its business was closed for 107 days
When open without restrictions, the New Zealand domestic gaming ecosystem is said to have performed well, however the company’s tourism related businesses continued to be negatively impacted by international border closures.
SkyCity reported that normalised profit after tax is expected to drop 145.3 per cent with EBITDA down 69.2 per cent, while on a reported basis these stand at declines of 143.3 per cent and 86.4 per cent, respectively.
Furthermore, the company, which added that “positive progress” has been made on its group-wide AML programme, also reported that its online casino revenue and earnings grew over the period, with around 10,000 active customers weekly.
New Jersey’s online casinos and poker rooms surged to yet another record month through January, as the region’s sportsbooks surpassed expectations following the much publicised stellar digital performance in its neighbouring New York.
The former set another revenue record through the month with $137.8m to eclipse the previous best of $133.2m generated one month earlier, as well as increasing 32.8 per cent from $103.7m year-on-year.
Revenue across the segment also rose to a record $4.4m per day over the 31 days of January from $4.3m one year earlier, which ultimately yielded $24.1m in state and local taxes.
Borgata continued to lead the way with $39.1m, up 36.2 per cent from $28.7m, ahead of Golden Nugget Online Gaming’s $36.4m, a 17 per cent uptick from $31.1m, and Resorts Digital, which increased 44.6 per cent to close at $33m (2021: $22.8m).
On a land-based basis, which saw revenue generate $183.6m (2021: $160m) of the $381.6m (2021: $346.1m) total, Borgata and Hard Rock occupied the top two spots once more with revenue of $48.3m (2021: $38.2m) and $34.7m (2021: $26.6m), respectively. Ocean Casino remained in third with $24.1m (2021: $20.4m).