Not-So-Happy Holidays: Massachusetts Casino Revenue Hits Historic Low
While gambling facilities around the country have enjoyed some normalization since the onset of the coronavirus pandemic, Massachusetts casino revenue actually retreated last month.
For the three commercial casinos in the Bay State, it was the worst full month ever.
Perhaps most frustrating for casino operators is that they have pushed for the freedom to offer new products. The impact of the state government’s inaction on that front is now visible on the casinos’ bottom lines.
Looking at the historically bad Massachusetts casino revenue
Encore Boston Harbor, MGM Springfield and Plainridge Park combined for just around $45 million in aggregate gambling revenue in November. That was not only a decrease of about $27 million from October but also a 43% drop-off compared with November 2019.
For all three facilities, November 2020 represented the lowest gross gaming revenue totals over a full month in their histories. Partial-month totals, like from March and July of this year, were lower.
Table GGR at Encore and MGM fell about 36.1% month over month. Slot revenue from all three facilities took a little bit less of a hit by the same measure, with a decline of around 33.1%.
The Massachusetts Gaming Commission reports do not include admissions, so it’s difficult to tell whether the historic lows came because of historically abysmal patronage. To whatever degree that was the case, it partially came by design.
COVID-19 restrictions played a part in limiting offerings
Trying to mitigate transmission of COVID-19 while keeping the doors open has been a challenging balancing act for many businesses since February. That’s also the obstacle all three commercial casinos faced last month.
The properties have limited gaming hours while shuttering amenities like hotels and spas. And of course, they’ve reduced their capacities on the gaming floors.
The reduction of gaming positions might have the most direct correlation with revenue. Casinos blocked off seats at gaming tables and removed slot machines from the gaming floors to accommodate social distancing requirements.
Win rate for slot machines at all three facilities held steady last month, so the decline in slot revenue wasn’t due to the casinos suddenly giving away more money. The sharp decline for MA casinos is also somewhat of an anomaly nationwide.
While casinos in other states have enjoyed an upward trajectory recently, Massachusetts casinos haven’t experienced similar improvement. For example, from September to October this year, casinos in 12 states and the District of Columbia saw an increase of at least 5% in slot and table games GGR.
Meanwhile, during the same period, Massachusetts casino revenue started its decline, by a measure of 2.6%. Looking at the 13 jurisdictions where casinos enjoyed the month-over-month growth, most of them had one thing in common.
Sports betting primed the pump in other states
In all of those jurisdictions where slot and table revenue rose by at least 5%, there is legal sports betting available either online, on a retail basis or both. Louisiana was the lone exception to that.
As a matter of fact, each state with regulated wagering of some kind — aside from Delaware, Illinois and Mississippi — saw slot/table GGR at their casinos remain flat at the worst. Among the three mentioned states, only Illinois saw a dip greater than a percentage point.
That’s why all these numbers likely irk Encore and MGM executives, who have pushed for the state to legalize sports betting. Had they been able to offer wagering on sporting events online during the months of the shutdown and even now while their other operations still face restrictions, sports betting revenue may have been able to mitigate the losses in those verticals.
While that might be crying over spilled milk at this point, it could strengthen their case with members of the state legislature for more action on legalizing sports betting during the next legislative session.
For now, though, a greater concern is avoiding a further decline in the current circumstances.