Nevada’s casino industry cracked the $11 billion gaming revenue figure during 2013, the first time the benchmark had been reached since 2008.
The Strip, where gaming revenues grew 4.8 percent, recorded its largest single-year percentage increase since 2011.
All thanks to baccarat.
The Gaming Control Board released the state’s calendar year-end and December gaming revenue totals Friday.
Statewide, casinos collected $11.14 billion during 2013, a 2.6 percent increase over 2012. The all-time state single-year record remains $12.8 billion in 2007.
On the Strip, gaming revenues hit $6.5 billion, a 4.8 percent increase over 2012. The Strip’s all-time revenue record was $6.8 billion in 2007.
Baccarat — a card game favored by high-end customers who travel to Las Vegas predominately from Asia — figured heavily into the numbers.
“Baccarat play continues to grow and be an important factor in the overall Strip performance,” said Union Gaming Group analyst Robert Shore.
“Of course, the activity only really benefits a few casinos that cater to that audience,” Shore said, citing Strip casinos operated by MGM Resorts International, Wynn Resorts Ltd., and Las Vegas Sands Corp. as locations with a healthy baccarat business.
Statewide baccarat revenues of $1.6 billion in 2013, an increase of 16.2 percent, set a single-year record. Gamblers wagered $11.8 billion on the game, which was the highest figure since 2003.
Just how important was the game?
Gaming Control Board Senior Research Analyst Michael Lawton said the statewide gaming revenue increase would have only been 0.6 percent without baccarat.
Lawton said baccarat revenues in 2013 were 14.3 percent of the overall statewide gaming revenue figure and 36.4 percent of the total table game revenues of $4.38 billion. Eleven years ago, baccarat accounted for 3.8 percent of Nevada’s overall gaming revenues and 11.7 percent of the table game totals.
“It’s been a gradual growth,” Lawton said.
Statewide, slot machine revenues of $6.75 billion was 60.6 percent of the over gaming revenue figure, the lowest percentage since 1990.
Stifel Nicolaus Capital Markets gaming analyst Steven Wieczynski said slot machine wagering is “the most relevant barometer for the health of Strip operators’ gaming floors.”
The Strip’s overall revenue total of $6.5 billion was 58.4 percent of the overall Nevada total, the highest percentage ever.
Meanwhile, Clark County as whole was a mixed bag with revenues increasing 2.9 percent. Other than the Strip, the balance of the county was the only other reporting area showing an increase, up 1.9 percent. Casinos reported annual gaming revenue declines of 1.5 percent in Laughlin, 1.6 percent in downtown Las Vegas, 1.2 percent on the Boulder Strip, 5.3 percent in North Las Vegas and 3.7 percent in Mesquite.
STRONG DECEMBER HELPS DRIVE 2013
The overall 2013 numbers were helped by December’s totals, where Nevada casinos collected $1.034 billion in gaming revenues, an increase of 9.6 percent. The December number was just the second $1 billion month in 2013.
On the Strip, gaming revenues increased 12.9 percent during December to $664.2 million.
Analysts said the December results bode well for MGM Resorts, which operates 10 Strip properties. The company will release fourth quarter and year-end earnings later this month.
Wells Fargo Securities gaming analyst Cameron McKnight said the December results on the Strip benefited from a high hold in baccarat and “indicate baccarat revenues are still driving growth.”
On the Strip, baccarat revenues were $243.9 million, a increase of 32.1 percent and the second highest monthly total in state history. However, baccarat wagering fell 6.5 percent to $1.6 billion.Still, the figure was the third highest wagering month ever.
The baccarat hold (the percentage of wagers casinos kept versus what players won), was 15.5 percent, compared to 11 percent in December 2012.
Deutsche Bank gaming analyst Carlo Santarelli told investors December’s Strip results were “somewhat misleading.” He said slot machine wagering was off 1.2 percent and table game betting (excluding baccarat) was down 8.1 percent.
“The usual year-end accounting shift, in which December slot (machine revenue) is depressed, was muted this year given New Years Eve was in the middle of the week, relative to Monday last year,” Santarelli said. “Accordingly, January slot hold is a very tough comparison this year.”
ONLINE POKER REVENUE STILL ELUSIVE
Union Gaming Group continued to try an extrapolate Nevada’s revenues from online poker. The state has just two websites operating and gaming regulators won’t break out the figure until a third state begins operating.
Shore said the figures “are baked into the card games number” in the Balance of Clark County area. That figure was up 13.2 percent in December to $1.5 million. Shore said the implies that online poker did roughly $200,000 in gaming revenue.
“Payment processing issues are likely still weighing on results,” Shore said. “We also note Nevada only allows online poker. We don’t expect online poker to be that meaningful.”
Through Jan. 27, Nevada collected $35.5 million in gaming taxes based on December’s revenues, a decline of 9.51 percent. For the first seven months of the fiscal year, gaming revenues are down less than 1 percent.
Contact reporter Howard Stutz at firstname.lastname@example.org or 702-477-3871. Follow @howardstutz on Twitter.