But as it turns out, those big revenue figures just provided a little “rainy day money” ahead of the dreadful tsunami of coronavirus and casino closings that went into effect on Monday night.
The New Jersey Division of Gaming Enforcement’s monthly revenue numbers came out Thursday at 2 p.m. — some 14 hours after the NBA suspended its season, less than two hours before the MLS and NHL did the same, and just a few minutes before Duke and Kansas’s announcements of shutting down their athletic seasons set the stage for the end of March Madness. The strong February sports betting handle will not be replicated in March.
Still, the February casino numbers felt at the moment of their release like something for the industry to celebrate. The industry enjoyed an 18.4% increase in revenues compared to February 2019 — helped no doubt by milder weather and a rare fifth February Saturday.
The gains also marked an unbroken chain of industry growth in every month since Hard Rock and Ocean Casino Resort opened in mid-2018. Dividing the “economic pie” by nine ways instead of seven has been a challenge for all operators, but for the state it has meant more jobs and more tax revenue.
Breaking down the numbers
The ever-growing divide between online poker and all other online casino games continued, with poker flat at $1.8 million and the other games collectively exploding by more than two-thirds, in a year-over-year comparison, to $50.2 million.
As for individual casinos, Ocean had the biggest brick-and-mortar bump of 51% to $20.8 million — passing Resorts and Golden Nugget to move into sixth place. New CEO Terry Glebocki reported that slot revenues were up by a robust 88%.
Borgata was up 13.7% to $57.6 million — more than the next two casino figures combined.
Resorts ($14.5 million) dropped to eighth place, while Bally’s remained in the basement at $12 million — both figures representing single-digit drops.
Golden Nugget remains king of the online casino gaming hill in the city, taking in $20 million out of the industry’s $52 million total.
What about March, though?
March’s numbers will be brutal for many obvious reasons, as the city’s casinos joined their brethren in New York State and Connecticut in shutting down by 8 p.m. on Monday.
But some context:
- The casinos got about half a month’s worth of gambling in before the storm hit on Wednesday night. The weather also has been reasonable again, which should provide a boost for that half-month.
- Online casino gaming could recoup a portion of the losses, as “amphibious” gamblers who are regulars both at the casinos and online shift all of their focus to the mobile options.
- Some brick-and-mortar casino players who have resisted signing up for the online casino apps may relent after a few days.
- Sports bettors have little product to bet on in the last two weeks of March, so some surely will start kicking the tires on online casino games for the first time.
Add those factors together, and March 2020 likely will produce more than half of the $294 million made by the casinos in March 2019.
As far as the impact on state coffers, overall tax revenues in that month last year were $25.5 million. So with any luck, the direct tax hit could be just a little over $10 million.
But that doesn’t include declines in hotel tax revenue, a drop in sales tax revenue from restaurants and bars at the casinos, and other spending that won’t take place in the city in these final two weeks.
An even more concerning issue is the real likelihood of a full month of grim numbers in April — and possibly part or all of May as well.
The nine-casino total has made getting ahead more difficult, and a worst-case scenario — one few in the city want to contemplate — could lead a casino operator to shut its doors for good.
Photo by Racheal Grazias / Shutterstock.com
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