July 2016 Gaming Revenue Showed Strong Growth
Internet Tops July 2016 Gaming Revenue Again
The July 2016 gaming revenue statistics are in and both NJ land based and NJ internet casinos posted year to year gains. Overall, year to date numbers show a slight increase of 3.2% over last year to date figures. Casinos edged out a slight 1.2% bump over July 2015 YTD figures while internet gaming posted a strong 32% increase.
The Atlantic City operators posted strong growth of 6.9% over the same period last year. The July 2016 gaming revenue increase was again led by internet growth of 38.6%. Caesar’s Interactive and the Golden Nugget led the charge with 27% and 36% growth respectively. These two casinos are continuing to build their online presence at a pace of 20% year to year. Outside of the internet gaming growth, the bricks and mortar casinos came in with a respectable 5.3% increase over July 2016 figures. Once again, Tropicana and the Borgata led the pack with approximately 13% growth for each of the casinos.
Changes Create Uncertainty
The coming months will be interesting for the Atlantic City casinos. The recent merger between MGM the Borgata has been completed. The Borgata has been a leader in the Atlantic City market so it will be interesting to see what effect the merger will have on revenues. The Revel has yet to reopen. Still plagued by permitting issues, the project remains at a virtual standstill. Owners hope to resolve the stalemate that has been ongoing with the Atlantic City permitting officials this month.
Iconic landmark the Trump Taj Majal has been getting much press these days. Not only because of the Trump moniker but because the strike has led to the ultimate closing by owner Carl Icahn. After 26 years of business, the property will close shortly after Labor Day. Is this a sign of additional weakness in an already uneasy market?
Expansion Referendum on for November
But that’s not all casino operators have on their minds. Voters will also get the opportunity later this year to decide on casino expansion in the north. This vote may make or break the Atlantic City operators. Two projects have been proposed for northern New Jersey. Opponents of the projects say that any expansion will further compound already struggling operators. Critics argue that weathering Pennsylvania’s casino growth is troubling enough. Adding more competition in the state would be catastrophic.
Proponents of the expansion say that the new projects may be a potential shot in the arm or just lead to the inevitable. Legislation provides that any expansion outside of Atlantic City will provide subsidies. The subsidies would then replace any lost revenues. Casinos not strong enough to weather the expansion will inevitably go the way of many others that closed recently. The strong growth in July 2016 gaming revenue may strengthen expansion proponents position.