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US – Atlantic City’s casinos see storm clouds clear

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Atlantic City’s seven remaining casinos have reported a 15 per cent rise in revenue in January compared to a year ago although much of the increase was due to reduced revenues in January 2016 due to bad storms.

Gaming revenue for the land-based industry in January 2017 came in at $204.7m, according to figures released by the New Jersey Division of Gaming Enforcement, showing an improvement of 7.7 per cent. Online casino revenue surged by 29 per cent in January, coming in at $18.8m compared with $14.6m in January 2016.

However Winter Storm Jonas ‘wiped out a full weekend last year,’ according to Matthew Levinson, Chairman and CEO of the state Casino Control Commission.

“A year ago I said winter storm Jonas, which paralysed much of the eastern seaboard, was one reason why casino revenues fell in January of 2016,” Mr. Levinson explained. “The same storm that effectively wiped out a full weekend last year is one of the big reasons why revenues for the current casinos jumped by 15.2 percent last month.

“Even though there were fewer weekend days this year, and most of the New Year’s holiday weekend fell in December, revenues still increased at slots, tables and from internet operations. Every single one of the current operators won more this January than in the same month last year, and Borgata had its best January ever.

“Also, casinos were a lot luckier than a year ago,” Mr. Levinson added. “Thanks to a big swing in the hold percentage, table game revenue increased by 18 percent while internet gaming revenue increased by 28.6 per cent. Even when results for the now-closed Taj Mahal are included, revenues are up by 7.7 per cent.”

Of the seven properties, Borgata, Caesars Atlantic City and Tropicana Atlantic City all reported double-digit revenue increases with Borgata’s $64m in GGR, an increase of 13.5 per cent, making January 2017 its best ever January.

Caesars recorded the biggest growth, up more than 41 per cent. Elsewhere Harrah’s increased by 1.1 per cent to $28.1m, the Tropicana increased by 14 per cent to surge past $27.3m, the Golden Nugget increased by 20.2 per cent to $23m; Bally’s moved up by 0.6 per cent to $14m whilst Resorts increased by 8.6 per cent to $12.3m.

On the online side, both the Golden Nugget, which generated $4.7m and Caesars, with revenues of $4m, moved ahead of previous online market leader Borgata, who generated $3.7m. Resorts closed the gap by generating $3.1m closely followed by Tropicana on $3m.

Colin Mansfield, an analyst with Fitch Ratings said: “The biggest reason behind the increase was the Winter Storm Jonas. Looking back over a 12-month period, it’s still a $2.4bn industry.”

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