internationalcasinoreview Business NEWS
Preliminary figures for most of 2010 show that casinos in Greece have suffered big falls in revenues with fewer visitors spending less. The casino sector will become entirely privatised this year but increasing competition from liberalised street gaming, illegal gaming, online gaming and cross- border gaming will not make 2011 any easier.
hardtimes GREECE
The economic crisis, the resurgence of illegal gam- bling, the uncontrolled pro- liferation of online casinos and competition from casinos located beyond the northern border have nega- tively affected the 2010 figures of the Greek casino market, it has been reported. According to initial esti-
mates, revenues at the nine casinos in the country closed last year with a reduction of 18 per cent or E120m com- pared with 2009, a combined turnover of around E508m. The fall compounds the 16 per cent year-on-year drop experienced by casinos in 2009.
Casino operators are pointing to a huge upsurge in illegal gambling over 2010, which some are estimating
AGEM Index ends 2010 on positive note
highend AGEM INDEX
The index of gaming indus- try supplier share prices gen- erated by the Association of Gaming Equipment Manu- facturers (AGEM), made a big step up in December, rising 10.2 per cent or 9.75 points to hit105.51, its highest level since April. It is the first double-digit
percentage increase since July 2009 and brings the index once again back above the 100-point level where it started in January 2005. Com-
pared to December 2009, it was down less than one per cent. AGEM’s Marcus Prater
said: “The AGEM Index out- paced the broader market measurements as the Dow Jones Industrial Average and Standard & Poor’s 50 Index increased by a strong 4.8 per cent and 5.9 per cent respec- tively during December.” Among the positive con-
tributors were IGT, which saw a 14.28 per cent gain to its share price, adding 3.79 points to the index, and Konami, which was also up
92 February 2011 • businessnews
14.28 per cent to add 2.11 points. The Index is weighted for market capitalisation. With the opening of the
Cosmopolitan in the City- Center complex, Las Vegas has seen its last big opening for some time. Nevertheless, prospects for the US market in general are looking slightly better with Moody’s revising their previous 2011 estimate for gaming revenue from flat to positive: however, the one to two per cent growth they predict is still marginal, especially for operators servicing larger
debt loads. Moody’s said that the tough times will linger with higher unemployment levels and gaming continu- ing to proliferate. Prater commented: “While the AGEM Index is comprised of selected pub- licly traded AGEM members, it is important to note that the overall AGEM member- ship has increased signifi- cantly during the latest business cycle from 32 members to 107 in 33 months. AGEM continues to grow and play an important role in the gaming industry.”
to have a turnover or E4bn, of which not a single coin is going to the cash-strapped government. Operators are also concerned about the spread of online casinos in the country. In addition, the northern casinos say that competition from casinos in Bulgaria and FYR Macedonia has also hit their revenues. In the first eleven months of 2010, combined turnover
at casinos was down 17.7 per cent on the same period in 2009, at E469.1m. Casino Porto Carras in Chaldiki was hardest hit, seeing a 44.6 per cent fall in revenues to November at E7.9m. Casino Xanthi experienced a 27.7 per cent fall to E6.9m, while the larger Casino Rio saw a 26.7 per cent drop to E21.7m.
Corfu Casino
dropped 22.7 per cent to E2.7m, while Club Hotel
2010 was very hard for Casino Porto Carras, which despite its 35 tables and 425 slot machines saw GGR down over 44 per cent by November
Casino Loutraki was down 19.6 per cent to E149.2m. Revenues at the Regency Casino in Thessaloniki fell 16 per cent to E110.5m, while those at Syros Casino were down 14 per cent to E4.6m. Mont Parnes Casino saw the smallest reduction, down
internationalcasinoreview Debt sale for CityCenter
MGM Resorts has announced a plan to sell $1.1bn (E847m) of its CityCenter joint venture’s debt in a private offering. It will use the proceeds to pay down its current credit line and get it extended four years. The company has continued make a loss on its stake in the $8.5bn (E6.5bn) development, which posted an operating loss of $1.27 billion during the first three quarters of 2010.
Greek casino revenues shrink 18 per cent as crisis bites
13.2 per cent to E140.2m. In the 11-month period,
drop at the gaming tables fell 13.8 per cent to E1.1bn. The number of visitors was down 6.9 per cent to 2.76m. The trend was expected to con- tinue in December, although official figures are not yet available.
Despite the economic
crisis, this year could be one of significant development for the gaming industry after many years of stagnation - although largely through the expansions of the street market, which could have a negative impact on casino revenues. The government’s economics team wants to generate as much as E500m by issuing VLT licences and another E200m from selling gaming rights.
On the casino side, the planned sale of the remain- ing 49 per cent share of Mont Parnes by held Greek gov- ernment is likely to go ahead: it wants between E120m and E150m for a significant holding in the country’s second biggest casino by revenue. It will mean the end of government involvement in casino operations, follow- ing its sale last year of Corfu Casino. Last year it also handed majority control of Mont Parnes to its partner Regency Casinos.
Another Ellis company in bankruptcy
strippeddown ELLIS GAMING
After sister company Ellis Las Vegas went into Chapter 11 in November, Ellis Gaming & Entertain- ment filed for bankruptcy at the end of December. The company said it had $12.1m (E9.3m) in liabili- ties.
It is 85 per cent owned by Ellis Partners LLC, with Sturm Gaming LLC holding the remaining 15 per cent, according to the filing. Both bankruptcies are
related to failed plans for a gambling resort on the Las Vegas Strip and to an ongoing legal dispute with
Elk Valley Rancheria, an Indian tribe that operates a casino in northern Califor- nia. The tribe has sued Ellis for failure to pay back a $480,000 (E370,000) loan with respect to the pro- posed Ellis Las Vegas resort. Ellis has countered that Elk Valley had con- verted the loan to equity. Ellis Gaming posted losses of $7.5m (E5.7m) in 2010. It said in its court filing that its main asset is a “possible breach of con- tract claim” for $5m (E3.8m) against Elk Valley. The biggest creditors are Seminole Wind LLC for $5m (E3.8m) and Sturm Gaming for $3.3m (E2.5m).
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