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UK casinos weathered worst of the recession


The UK Gambling Commission report on the casino industry showed that despite a declining economy that inevitably affected revenues, it managed to stay reasonably strong, supporting and creating more jobs when other sectors were losing staff.


bestbet UK GAMBLING COMMISSION


The number of casinos oper- ating in the UK fell by three per cent in the year to the end of March 2010, the Gam- bling Commission has reported in its latest analysis of industry statistics - down to 141 from 145. The casino sector, while


by far the smallest in terms of the number of outlets and operating licences, at just two per cent, is the second largest in terms of gross gaming yield (GGY): out of a total yield for gambling of £5.7bn (E6.78bn), casinos had a 14 per cent share or £798m (E950m). By far the biggest participant in the gambling industry is betting, with 52 per cent of the market. Total GGY was down one per cent on the previ- ous year. Three companies own the


majority of casinos in the UK. Genting UK, which oper- ates under Circus, Maxims and Mint brands, is the largest with 44 venues, one less than in the previous year, followed by Rank’s Grosvenor and G Casinos, which account for 35 venues, three more than pre- vious. Gala Coral’s estate remained unchanged at 27. The next largest operator is London Clubs International, which dropped one venue and now operates ten of its licences. The 25 remaining casinos - five fewer than pre- viously - are owned by other single-site or small chain operators. Despite fewer venues UK casinos


operating,


employed substantially more people than in the pre- vious year, with full-time


equivalent jobs up 14 per cent to 13,827, while the number of people actually employed rose 18 per cent to 15,988.


Attendance at also rose


during the period, with visits reaching 17.1m up three per cent on the previous year. None of the different coun- tries or regions of the UK saw a fall: in the South and in the Midlands & Wales, visits held steady at 2.9m and 3.9m respectively. Visits to casinos in Scotland were up 13 per cent to 1.7m; a similar increase was seen at high- end casinos in London where there were 154,000 visits. Other casinos in the capital were up three per cent to 3.6m visits. The North region saw a two per cent increase to 4.9m visits. The total gross gaming yield of £798m (E950m) gen- erated by casinos, was down very slightly on the previous year in line with the rest of


the gambling industry. While machines are by far the junior element in terms of revenues, they saw a 19 per cent uplift to reach a gross profit of £137m (E163m) - there is currently no gam- bling levy on the machine win, as each machine pays a separate licensing duty. Machine income now accounts for 18 per cent of the total casino yield. At the tables, the drop fell


three per cent nationally to £4.39bn (E5.22bn) with the non-high-roller casinos in London - the biggest con- tributor to the total with £1.57bn (E1.87) - seeing the greatest fall of five per cent compared to the previous year. The house win rate remained constant at around 15 per cent across the country (except in the high- end London casinos when it dipped to 13 per cent), meaning a house win from the table of £641m


(E762.8m), a sum five per cent lower than in 2008/9. Live American roulette


remains the dominant game in UK casinos accounting for more than half the national drop. Drop at elec- tronic roulette terminals rose nearly two per cent to £743.3m (E884.5m) becom- ing the second-most popular casino game overtaking blackjack, which suffered a decline in drop of eight per cent to £713.2m (E848.7m). Punto banco in fourth posi- tion saw the drop increase by more than six per cent to £426.1m (E507m). All the casinos currently


operating do so under 1968 Gambling Act. None of eight large or eight small casinos mandated under 2005 Act has yet received a premises licence - and none are likely to have been granted by the end of the current financial year, although slow progress is being made in some areas.


SFC’s Casino Châtel-Guyon near Clermont Ferrand in the Massif Central of France


Revenues nudge upwards at under- scrutiny SFC


visitorslead SOCIÉTÉ FRANÇAISE DE CASINOS


Société Française de Casinos, which operates two casinos on the Mediterranean coast near Narbonne and another in the Massif Central, has reported annual revenues to the end of October slightly ahead of last year. The company was placed into administrative supervision last summer after it failed to refinance its debts. While gross gaming


revenue (GGR) dropped by 1.8 per cent to E14.6m, lower taxes helped it to an increase in net gaming revenue of 1.3 per cent to E8.1m. The company’s hotel, restaurants and shows had a good year, with revenues up 13 per cent to E2.8m. The combined revenue generated by the casinos was up 4.1 per cent to E10.9m.


The company, formerly Dore takes loss for selling junket operations


countingdown DORE HOLDINGS


VIP room operator in Macau, Dore Holdings, has reported first half revenues of HK$34.9m (E3.4m), a reduction of 86.7 per cent from the same period last year, after divesting itself of junket operations in May


last year. With no costs to speak


of, almost all that is also gross profit. The company said: “With


a rapid increase in VIP gaming rooms [in Macau] in the first half of 2010, VIP junkets are offering higher rebates and extending unsecured credit to VIP


88 February 2011 • businessnews


customers aggressively in order to maintain their rolling turnover. As a result, most the of the junkets in Macau have encountered liquidity problems due to difficulties in debt collection.” Dore said that while its


partners had been managing their risks


carefully, the keen competition saw a fall in rolling turnover, so it made the decision to four of its subsidiary junket companies. The company is for the moment maintaining its interest in VIP gaming at the Venetian, however, a reassessment of its accounting procedures


there has led to an impairment provision being made, resulting in an on- paper net loss of HK$416.2m (E41.2m), however the company believes that its net profit before non-cash items of HK$31 (E3.1m) is a better reflection of its performance.


known as La Tête dans les Nuages, is also a partner in various amusement parks and other outlets offering non-gambling games, however, those activities saw a drop of 9.2 per cent to E2.6m. Total revenues


generated by the company over the year reached E13.5m, up 1.2 per cent on the previous year. The company said: “The 2009/10 financial year was marked by an increase in visitors to SFC casinos of 3.6 per cent. The group is harvesting the fruit of the actions it took, particularly in marketing, throughout the year, and from the revitalisation of its slot machines areas following the installation of small- denomination machines.” While the company’s operating results are improving, it has yet to find a knight in shining armour to help it out of its debt crisis.


Doubled chip turnover for AERL Macau VIP room operator Asia Entertainment & Resources Ltd (AERL), reported a rolling chip turnover in December of US$1.34bn (E1.03bn), double the amount recorded in December 2009. Annual rolling chip turnover was 101 per cent up to $10.42bn (E8.02bn). The company last year bought Kings Gaming, and with it a VIP room in the Venetian Macau to add to its VIP rooms at StarWorld and MGM Grand.


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