January 10, 2014 - 11:42 pm
Nevada casinos suffered their fifth consecutive fiscal year net loss in 2013 despite a slight overall increase in revenue.
Strip casinos experienced a similar fate. Overall Strip revenue increased 1.7 percent during the fiscal year. But Strip casinos lost almost $1.5 billion.
Still, the Strip’s net loss was a 13 percent decline from fiscal 2012’s net loss of $1.7 billion.
The figures were part of the Gaming Control Board’s annual Gaming Abstract Report that was released Friday.
The abstract takes into account all revenue — gaming and nongaming — produced by casinos grossing more than $1 million in gaming revenue over the fiscal year, which ended June 30. In 2013, there were 263 casinos that provided results, two fewer than a year ago.
Statewide, Nevada casinos generated a net loss of $1.348 billion in fiscal 2013. In 2012, casinos lost $1.212 billion.
The last time Nevada casinos recorded a net profit was in fiscal 2008 — $721.1 million. The largest net loss came in 2009 when casinos lost almost $6.8 billion.
Despite the loss, total revenue statewide increased less than 1 percent. Nevada casinos collected more than $23 billion in total gaming and nongaming revenue in fiscal 2013, compared with $22.976 billion in 2012. Total revenue is the money spent by customers on gaming, hotel rooms, food, beverage and other attractions, such as shows and retail.
The net loss came after the casinos paid expenses. The loss does not take into account deduction for federal income taxes and accounting for extraordinary expenses. Most of the losses statewide were on paper, reflecting expenses taken for financial restructurings in 2012.
For the state, general administrative expenses for casinos increased 3 percent to $10.6 billion, which wiped out any gains in overall revenue.
Gaming revenue statewide was almost $10.395 billion, an increase of 1.1 percent, or 45.1 percent of the total revenue. Hotel room revenue was the next highest piece of the pie, $4.788 billion, or 20.8 percent, while food revenue of $3.454 billion accounted for 15 percent of the total.
Gaming Control Board Senior Research Analyst Michael Lawton said fiscal 2013 marked the first time since 2007 that gaming revenue showed a better increase in its percentage of the overall total than nongaming areas. Last year, gaming revenue was 44.8 percent of the overall figure.
The 263 casinos listed in abstract paid more than $804 million in gaming taxes, equating to 7.7 percent of their gaming revenue. During the fiscal year, 66 casinos owned by public companies accounted for 76.6 percent of the total gaming revenue generated statewide.
On the Strip, casinos lost $1.496 billion on revenue of $15.538 billion during the fiscal year.
Gaming revenue on the Strip was $5.75 billion during the fiscal year, an increase of 3.5 percent. Hotel room revenue on the Strip was $3.928 billion during the fiscal year, 25.3 percent of the overall total, while food revenue accounted for $2.414 billion, or 15.5 percent of the total.
The Strip’s divide between gaming and nongaming revenue was even more pronounced than the state: gambling accounted for 37 percent of the casinos’ overall revenue.
Like the state, however, gaming revenue slightly increased its percentage of the overall total for the first time since 2007. Last year, gaming accounted for 36 percent of the overall figure.
Lawton said increased development of new retail and entertainment components on the Strip, such as Caesars Entertainment Corp.’s $550 million Linq project and a $100 million retail, dining and entertainment complex being developed by MGM Resorts International, could change the percentages once again.
Clark County as whole generated a combined net loss of $1.337 billion from total revenue of almost $20.6 billion. Downtown casinos lost $17.8 million during the fiscal year, while overall revenue fell less than 1 percent.
Casinos operated in the rest of Clark County, which is primarily a locals market, reported net income of $120 million, despite a 2.1 percent decline in overall revenue.
Washoe County casinos, which includes Reno, recorded a collective net income of $719.4 million, but saw overall revenue decline 3.8 percent to $1.386 billion.