This last week was one that recapped financial results. Some brands saw strong results while others slipped further down in recession. With lockdown measures now loosening up at least a bit, most companies are putting their reopening plans at some point for June or July as the most realistic earliest estimate. This is the weekly news round-up where we recap what happened in iGaming over the past five days, May 11 – May 15.
Caesars Profit Up Even Though Revenue Drops in Q1
Some companies have shown more resistance than others. This is particularly the case of Caesars Entertainment Corporation (CEC) which posted $123 million profit for Q1, 2020, managing to handle the ongoing lockdown fairly well.
According to the company, net revenue in the three months leading up to March 31, 2020 contributed some $1.83 billion to the company’s bottom line, which was still 13.6% down from the results last year when Caesars posted $2.12 billion.
Following Q1’s closure, though, Caesars announced that the company was going to furlough some 90% of its staff members in order to cushion the impact from the suspension of all land-based gambling activities and sports around the United States and the world.
The company has been quick to seek ways to assist its employees, though, setting up an emergency fund for those affected the most. Tourism has been a non-starter with Nevada and all states in the country on a lockdown.
Tony Rodio, Caesars’ CEO, has noted, however, that even though Q1 results have been reassuring, it would most likely go downhill for a while. “Our first quarter performance reflects the significant revenue declines we experienced as a result of the closures and stable year over year labor costs in March as we continued to provide pay and benefits to our team members for the first two weeks of the closure period,” he said.
Rodio also noted that the company is preparing to reopen where the company can realistically afford to.
COVID-19 Shutdowns Lead to Q1 Loss for Eldorado Resorts
Hot on the news that Eldorado has merged with Caesars, forming a new mega-gaming giant, Eldorado reported a loss in Q1, 2020. Business started well, Tom Reg, Eldorado man at the helm said, but added that subsequent events have been pushing down the results.
January and February were patchy months for the company, with mandated closures biting deep into the revenues of the company. Eldorado sold Presque Isle Downs and Lady Luck Casino Nemacolin to Churchill Downs back on January 11, 2019 and March 8, 2020 respectively, easing off the real-estate portfolio and thus cutting some costs and expenditures.
There has been a 27.8% drop in casino and pari-mutuel commissions. Food and beverages went down another 25.3% million and then hotels took another tumble 25.3%. However, Reeg hasn’t been too concerned with these developments, chalking them up to natural consequences from the nation-wide lockdown.
The executives said that Eldorado was fully-committed to the well-being of all employees and patrons. He reminded that furloughed employees have received four weeks of pay and that team members will continue to get health care benefits until June 30, 2020.
Depending on the situation, Eldorado will have to revisit and determine if it can restart operations as usual.
MGM Resorts Charts a Re-opening Plan Hoping to Restore Operations
While the difficult times are bound to persist for at least another few months, MGM Resorts has already drafted a comprehensive plan to restart activities. Said plan features a seven-step strategy that will see the casino focus on launching activities at a limited capacity but across multiple states.
In enacting this plan, MGM Resorts will seek support from state regulators, health authorities and local governors, MGM Resorts CEO Bill Hornbuckle said. He further noted that the plan had not been devised on the plan.
Instead, MGM Resorts has been consulting with expert parties since the beginning of the lockdown to seek a quick way to restore operations once the nation-wide shutdowns have been lifted and businesses has been allowed to return.
The plan includes a wide-reaching screening program to make sure that employees and patrons are safe and that they aren’t carriers of the virus. MGM will perform extensive temperature checks and use thermo-cameras to keep a constant eye on players.
Players and staff will have to wear masks and personal protection equipment, i.e. PPE. The rules mostly apply to staff members, but MGM will strongly encourage patrons to wear masks. Drinks will be allowed but no food will be available at the casino.
For its hotel properties, MGM has said that it will continue to encourage guests to check in through their mobile phones using the MGM app, although physical check-ins will understandable still be an option.
Delaware’s iGaming Results Show a Promising Trend with Segments Growing
Yes, Delaware may be one of the smallest, but the state has proven remarkably resilient to the repercussions of the state-wide lockdown. Part of this can be explained by the fact that Delaware is not necessarily a gaming hub and doesn’t have as many casinos as other states.
However, the state’s online gaming revenue has gone up. The exact numbers are pretty promising with 39% year-over-year increase. Of course, this has been occasioned entirely by the lack of land-based activities, but it still shows great resilience in the state.
All three licensed operators saw fairly decent online gaming results, including Delaware Park, Dover Downs and Harrington Raceway. Delaware managed to generated a total online gambling revenue worth $2.1 million, or double the amount generated in April, 2019. Online poker also benefited with registrations reaching 1,400 new players in April or close to a 290% spike year-over-year.
While the iGaming trend will remain questionable, the state’s quick adoption of online verticals has been one of the key strengths of Delaware, as the latest Delaware Lottery numbers have revealed.
Online gaming revenue has increased as a compound total across the United States, with some expecting the trend to keep at least through the end of 2020 or maybe next summer if COVID-19 goes away and tourism number return to usual.