Casinos and gamblers bet on the July reopening. It hasn’t quite paid off yet
While all nine Atlantic City casinos reopened in July, online gambling remained hot as bettors apparently preferred to place their wagers remotely. In fact, only two properties fared well last month – Ocean Resort Casino and Golden Nugget – according to numbers released Aug. 12 by the Division of Gaming Enforcement. And most of Golden Nugget’s revenue came from a boom in – yes – online gambling: $31 million from the internet, with less than $9 million from the casino floor.
Revenue for all nine casinos and two racetracks totaled $264 million in July, a steep drop from last year when they took in nearly $335 million. Meanwhile, the online sportsbooks brought in nearly $296 million in July, and just $19 million from its in-person pools. Those figures were largely in line with what the physical and virtual sportsbooks took in last year: $38 million and $213 million respectively.
The July 4th weekend marked the first time that patrons could gamble in person since the casinos were closed on March 16 under a set of orders Gov. Phil Murphy signed to halt the spread of COVID-19. Table games and slot machines were off-limits for those three months, hitting the casinos hard and leading some establishments to show triple-digit percentage drops in revenue.
With casinos closed, online gambling offered a lifeline. In July, online revenue increased from more than $39 million last July to almost $86 million. Caesars Interactive NJ – the online gambling arm of the gaming behemoth – was the only of the company’s properties in the state that did better. It brought in $9.6 million this July, compared to $5 million last year.
Once they reopened, casinos had to enact social distancing protocols – like empty slot machines between each occupied one and plexiglass at gaming tables – as well as intense sanitization. To screen workers and guests for COVID-19 symptoms, many installed wall-mounted thermometers
“Although July’s results are lower than the same month last year, the two years are not reasonably comparable – some casinos reopened in phases beginning on July 2, and historical market leader Borgata reopened on July 26,” James Plousis, who heads the state’s Casino Control Commission, said in an Aug. 12 statement.
“Travel advisories also remain in effect, limiting visitors from out of state,” he said.
The Meadowlands Racetrack in East Rutherford, just a few miles away from New York City and Newark Liberty International Airport – one of the nation’s busiest – made $14 million from sports wagers. Last July, the Meadowlands saw $9 million from its sportsbooks.
Monmouth Park Racetrack, where Murphy placed the state’s first legal sports wager in June 2018, felt the squeeze, making $1.9 million in 2019 but just $1.7 million in 2020 from sports betting.
Casino wins at the brick and mortar locations themselves were $147 million, compared to $277 million last year.
“It will take some time before Atlantic City rebounds from the closures of the last few months, but we have at least turned a corner in the market with the return of the retail sector,” PlayNJ.com analyst Dustin Gouker said in an Aug. 12 statement. “However, online casinos and sportsbooks should drive the overall market as long as the pandemic continues.”
Ocean was the only establishment showing a year-over-year improvement on the casino floor in July, winning $23.6 million compared to $19 million last year.
“To exceed the prior year by 23 percent with one less day of gaming in 2020, as the reopening was on July 2, and without indoor dining, drinking and smoking, is indicative of the momentum Ocean has created,” Chief Executive Officer Terry Glebocki said in an Aug. 12 statement.
“We needed to completely rethink our experience from arrival to departure. Our team has made hundreds of operational changes throughout the property to provide a safe environment,” Glebocki added. “Ocean is ideal for social distancing with over six million square feet of space and three acres of outdoor spaces.”
Caesars’ four properties – Harrah’s Resort, Caesars Atlantic City and Bally’s Atlantic City – all fared worse in 2020 than in 2019. Tropicana, which Caesars now controls after a $17.3 billion merger with El Dorado Resorts, also showed deterioration.
Hard Rock Hotel and Casino Atlantic City, like the other brick and mortar establishments, took a nosedive at its casino floor, bringing in nearly $25 million, compared to nearly $39 million the prior July.
“We will remain aggressive in keeping safety a top priority, especially as new regulations and recommendations are released,” Hard Rock President Joe Lupo said in an Aug. 12 statement. “We will continue to adapt and find innovative ways for our customers to enjoy the indoor and outdoor amenities they have come to know and love.”
Resorts Digital – the online gambling arm of Resorts Casino Hotel – raked in $26 million from online gambling, a triple digit percentage increase from the $10.5 million the gaming outfit generated last year. But Resorts’ casino floor took a hit on its winnings, drawing $12 million in July compared to $17.6 million a year ago.
“Even with public health precautions in place, there was great concern that patrons would not yet feel safe visiting the casinos in person, and there would be an extended ‘COVID drag’ on the industry,” Jane Bokunewicz, coordinator at Stockton University’s Levenson D. Institute for Gaming, Hospitality and Tourism, said in an Aug. 12 statement. “Whether this recovery could continue and grow will likely depend on the status of COVID-19 infection rates in the tri-state area and consumer confidence in industry safety measures.”
And with the lack of indoor dining and alcohol sales for the foreseeable future, casinos will have to adapt to an entirely new reality, Bokunewicz said.
After Murphy abruptly pulled the plug on indoor dining, the state’s casinos scrambled to rework their reopening plans. Ocean offered food and beer trucks outdoors, and takeout options from its indoor establishments. Resorts also took much the same route.
Borgata, the only New Jersey casino to delay its reopening plans because of the pause of indoor dining, posted the steepest drop in profits year over year. This past July, the casino floor brought in just $8.3 million, an 89 percent decline from $80 million last year.
The uncertainty surrounding the fall football season, and the possibility that the current baseball and basketball seasons could be upended at any moment in the event of an outbreak, could have devastating effects on the state’s sports betting market.
On Aug. 11, the Big Ten Athletic Conference said it was cancelling its fall football season, as did the Pac-12. “If college football is canceled which is looking inevitable, sports betting revenue potentially flattens for the remainder of the year,” Max Bichsel, vice president of U.S. business at the Gambling.com group, said in a statement.
“All attention will shift to the NFL, which we optimistically believe is planning for some sort of safe return this fall.”n