Slots Revenue Flat

In a recent press release, the Pennsylvania Gaming Control Board noted that slot machine revenue in June 2010 was 8.2 percent higher than the June 2009 level. The data shows that in June 2009 the total slots revenue from statewide casinos was $165.1 million and in June 2010 that level reached $178.6 million-an increase of 8.17 percent.

But what they don’t detail is that the June 2010 figure counts the revenues from the Rivers Casino, which was not open in June 2009. The Rivers earned $19.1 million in June 2010. Furthermore the press release notes that the Meadows lost nearly 23 percent during that time or nearly $6 million. The Meadows’ total revenues in June 2009 were $26.1 million and in June 2010 fell to $20.1 million. There is no mention that the lower revenues at the Meadows having been the result of the nearby Rivers Casino opening. The net effect of the Rivers Casino on statewide slots revenues was only $13 million.

So what is the true story with slot machine revenues in Pennsylvania?

If the Rivers’ revenues are excluded from the June 2010 statewide totals and the Meadows revenues are excluded from both the June 2010 and 2009 statewide totals, the true story is revealed. Without the Meadows, the June 2009 totals are $138.97 million. Removing both the Rivers and the Meadows from the June 2010 totals reduced the actual amount to $139.3 million-total growth is a little more than $300,000. Thus the total revenues across the state, outside of the southwest, are essentially flat.

Of the seven casinos outside of southwestern Pennsylvania, three experienced a decrease and four had increases. The true picture of slots machine revenues is that there was no growth. June 2009 was of course in the middle of the recession and should have been a bad year for the gaming industry. Therefore there should have been substantial growth in 2010 as the economy began its recovery. That has not happened and should be cause for concern.