It's been a busy month in the gambling industry as Las Vegas opened a new casino, Macau shook up its future, and Singapore filled its coffers.
Asia grows, Vegas slows, what's new?
After a few strong months, Las Vegas Strip gambling revenue fell 4.1% to $454.3 million in November. In comparison, revenue grew 16% in October and a modest 2.8% in September, but investors shouldn't panic over the drop. Convention business was pushed from November to October, and if you smooth out the changes by averaging them, that is still 4.9% growth on average.
Macau gaming revenue grew 66.4% in December and ended 2010 with 58% growth for the year, another banner year. The end of 2010 was very similar to the end of 2009 with gaming revenue virtually flat for the final three months of the year. I'll be watching next month to see if revenues take another jump or if we're in for slower growth in 2011 (slower than 66% still isn't all bad).
The bounce in revenue should help Melco Crown
If you thought Las Vegas was struggling, Atlantic City conditions are even worse with gambling revenue down 9.6% in 2010, the fourth straight year of declines. MGM Resorts
Las Vegas Sands in focus
It's been an interesting month for Las Vegas Sands
In positive news, Adelson did move closer to monetizing co-ops at the Four Seasons hotel, which would continue the strategy of selling off non-core assets.
Singapore gambling is off to a smashing start, as expected. From April to November of 2010, $324 million was contributed to the Singapore government from the two casinos there. Marina Bay Sands should give investors plenty to cheer about when fourth quarter earnings are released.
MGM asks for more cash
I'm dumbfounded at how sophisticated investors can keep giving cash to MGM Resorts, and yet the company has come with pockets turned out again. Now it wants to sell $1.1 billion in notes to refinance CityCenter. The rating agencies don't even know what to think with Moody's giving a stable outlook and S&P having a negative outlook.
All I need to see is an $8.5 billion price tag for the resort and $52.4 million in EBITDA during the first nine months of 2010 to give a negative outlook. With that said, if the deal goes through shareholders should cheer because maturity would be pushed back four years.
Another new casino
The Cosmopolitan, owned by Deutsche Bank
Gambling news of the weird
In our first, and hopefully last, Motley Fool crime update, the $1.5 million in casino chips stolen from MGM's Bellagio in December will soon become worthless. The casino is discontinuing the $25,000 chip stolen in the heist, and on April 22 their value will be reduced to whatever you can get on eBay.
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