It’s a thrill to ride roller coasters, especially the ones that creep to a towering perch, only to dive at breakneck speed, before returning to new heights in zero gravity.
There’s nothing like it — unless you dive deep into gaming win statistics provided monthly by the state Gaming Control Board.
Anyone who has regularly studied the numbers knows the extreme volatility of gaming win statistics for Southern Nevada’s geographic regions. An area may be up by double-digit percentages one month, and down similarly the next month. Maybe the next month, things level off, only to climb high, then drop low, just like the Desperado coaster at Primm, a personal favorite.
But then, some roller coasters such as Viper at Six Flags Magic Mountain in Southern California, another favorite, that throw you for a loop and jerk you around, which also is reminiscent of gaming win numbers.
A great example of gaming win roller coastering occurred in April’s and May’s numbers, the latter of which was released a few days ago.
In Clark County, the Gaming Control Board monitors the Strip, downtown Las Vegas, North Las Vegas, Laughlin, the Boulder strip, Mesquite and the “balance of the county.” Because casino performance is proprietary information for some companies, which casinos are within each area isn’t disclosed by the Control Board.
The board says there are at least four properties in each area and in many cases, we can guess which ones are there.
Michael Lawton, a senior research analyst for the Control Board’s Tax and License Division, compiles and crunches the numbers.
The big headline for May numbers was that on the Strip, the gaming win was down 11.7 percent from May 2015, which Lawton and several investment analysts attributed to that month being terrific and setting an unattainable target for this past May. May 2015 had five weekends in which the Friday, Saturday and Sunday were completely within the 31-day period. There were only four such weekends in May 2016.
May 2015 also had the highly anticipated Floyd Mayweather Jr.-Manny Pacquiao fight and Rock in Rio’s debut in Las Vegas.
Although the Strip gaming win performance was lackluster, the Clark County win was down only 4.4 percent, partly because other Southern Nevada regions performed well. Downtown was up 13.1 percent; the Boulder strip climbed 25.9 percent; North Las Vegas soared by 27.8 percent.
Those are the high points on the roller-coaster ride. But look back at April. Downtown win was down 13.5 percent; the Boulder strip was off 18.9 percent; North Las Vegas fell by 14.4 percent.
What happened? Those three areas didn’t suddenly forget how to get people into their casinos in April, then rediscover the secret sauce in May. The answer, Lawton said, is in when the money is counted. The phenomenon even has a name, “a data collection anomaly.”
The outlying areas house mostly locals casinos, and the bread and butter of most locals casinos is slot play. For those casinos, the gaming win doesn’t become official for the company — and the state — until the bill validators are emptied and the win is calculated. That requires workers to crack open every slot machine to collect cash and data.
When do you not want to do that? When the casino is busiest, generally Fridays, Saturdays and Sundays. As a result, whenever the last day of a month falls on one of those days, technicians will wait until Monday to collect money and data. That means there will be months that essentially have 27 days of revenue, others with 33 or 34 and some in between.
April was one of those months that ended on a Saturday while the last day of May was a Tuesday. A year ago, April ended on Thursday and May on Sunday.
Ultimately, every day is going to get counted but the year-against-year comparisons will produce some unusual percentage swings that make it appear some markets are doing well one month and poorly the next. Lawton said the Strip has greater overall volume and table games like baccarat have a greater influence on overall win. Baccarat is extremely volatile because it’s so popular with Asian high rollers. Whether luck favors the player or the house will sometimes swing gaming win.
Because the Control Board also publishes three-month and 12-month comparisons as well as year-over-year monthly comparisons for each geographic area and the state, many observers regard those comparisons as a better gauge of how gaming win and tax collections are trending. Right now, it’s trending flat compared with last year based on the 12-month average, which shows statewide win is 0.54 percent ahead of last year.
Lawton said because of the “tough comparison” analysis for May, he’s not losing any sleep over state tax collections, which are running about 1.1 percent under last year’s rate. In 11 months, fee collections were up six months, but down five and the state has collected $625.2 million in the current fiscal year.
Finally, some level track to consider on the roller coaster.