Nevada gaming revenues down for fourth straight month

February's gaming results never stood a chance.

Statewide casino revenues dipped almost 7 percent during the month, which was Nevada's fourth straight monthly decline, according to figures released Friday by the Gaming Control Board.

On the Strip, gaming revenues fell almost 9.6 percent in February, also the fourth month in a row the take from gamblers decreased.

The reason?

Making a comparison to the results in February 2010 was impossible.

A year ago Strip gaming revenues soared almost 33 percent, the result of a record 255 percent increase in baccarat revenues that were fueled by the customer-rich Chinese New Year holiday and Super Bowl weekend. The Strip's results translated into a 13.9 percent increase in statewide gaming revenues for February 2010.

Going in 12 months later, analysts said the year-ago figures would be tough to match, even with Chinese New Year and the Super Bowl landing in the month once again.

"We view February's casino revenue trends to be within our expectations of a slow and tentative casino revenue recovery along the Strip with a more pronounced lag in improvement throughout the downtown and locals markets," Jefferies and Co. gaming analyst David Katz told investors.

Stifel Nicolaus Capital Markets gaming analyst Steven Wieczynski said his firm's clients should not read too much into the Strip's revenue decline because of the difficult baccarat comparison.

"On the whole, February's results were consistent with our belief that conditions along the Strip have stabilized, with early evidence of modest growth likely to become apparent in the back half of the year," Wieczynski said.

Nevada casinos collected $881.8 million from gamblers in February, compared with $946.6 million collected in February 2010. The decline was the largest monthly dip in the past four months.

On the Strip, casinos took in $769.5 million during the month, compared with $827.8 million collected in the same month a year ago.

Macquarie Securities gaming analyst Chad Beynon said February's decrease, coupled with January's 2.5 percent gaming revenue decline, should give investors in MGM Resorts International some caution toward the company and the Las Vegas market. MGM Resorts operates 10 Strip properties, including Aria, Bellagio and the MGM Grand.

"We will look for positive trends in hotel fundamentals, non-baccarat table play and convention attendance as drivers of a recovery," Beynon said.

On the Strip, total baccarat revenues were $140.5 million, down 31.5 percent from February 2010. Gamblers wagered $1.2 billion on baccarat, almost the same amount as a year ago, but the hold percentage was 11.7 percent, compared with 17 percent last year.

In a report to investors the day before Nevada released February's figures, Sterne Agee gaming analyst David Bain said the opening of two casinos in Singapore last year might slice into baccarat play in Las Vegas.

Strip casino customers wagered $2.5 billion on all table games, including baccarat, which was an increase of 3.9 percent. When baccarat is removed from the equation, revenues from table games grew 2.68 percent.

Total slot machine revenues on the Strip were $214.5 million, a 3.2 percent increase from a year ago. Gamblers wagered $3 billion on slot machines, compared with $3.2 billion last year.

Gaming Control Board senior research analyst Michael Lawton said there are signs the state's casino industry is recovering from the recession.

In the first eight months of the fiscal year, the amount customers wagered on slot machines is down 1.8 percent. For the same eight months a year earlier, the slot machine wagering was down 10 percent.

Analysts have said slot machine wagering is a general indicator of the Strip's overall health, reflecting play levels by the average gambler.

"We're seeing some indications the market is coming back," Lawton said.

Clark County gaming revenues on a whole fell 7 percent in February as three reporting areas, Mesquite, North Las Vegas and the balance of the county, showed modest gaming revenue increases.

Nevada collected almost $41.6 million in gaming taxes in March, which was based on February's taxable revenues. The figure was an 11.1 percent decline compared with $46.8 million collected in the same period last year.

Gaming tax collections are up 1.8 percent for the first nine months of the fiscal year.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.