The reports are in for Louisiana’s June gaming revenues and the numbers aren’t pretty. The state saw casino revenues decline 10 percent year over year, according to the Louisiana Gaming Control Board, which has a lot of people wondering what’s going on.
It’s unclear what the cause is, but the reality is that Louisiana casinos saw a 10 percent decline in revenues year over year. L’Auberge Lake Charles was hit the hardest as it is down 15 percent. Baton Rouge dipped 13 percent, the Shreveport casinos were down 11.6 percent, Lake Charles fell 10 percent and New Orleans dropped 5 percent.
One possible explanation is that competition in neighboring states is pulling away business from Louisiana. For example, residents of nearby Dallas, Texas, who often go to Louisiana for some gaming options, have the WinStar World Casino and Resort in Thackerville, Oklahoma, as another outlet.
Not only is there more competition in the neighborhood, the other concern is that the casinos in Louisiana are not reinvesting in their properties to keep them up-to-date. For example, the Belle of Baton Rouge saw their revenues decline 43 percent – the biggest fall of the bunch.
However, part of that could be the upkeep, or lack thereof. According to Louisiana radio station KPEL 96.5, state Gaming Control Board Chairman Ronnie Jones said that a sale could be forthcoming.
“They have just not put any capital back into the property, they’re just trying to keep the property open and running and trying to keep it profitable so they can sell it, but they haven’t found a buyer yet,” Jones said, according to the station.
If there is one bright spot it’s that even with the decline, gaming revenues have exceeded oil and gas revenue in funding the state, Jones said, so that’s a positive.
There was only one casino in Louisiana that made money year-over-year and that was the Margaritaville in Bossier City. It saw a 0.6 percent increase over June of 2018. That’s surprising as the rest of the Shreveport/Bossier market was still down 12 percent – including two other properties that saw declines of 20 percent or more. Seven of the state’s casinos saw declines of 10 percent or more.
The concern is the trendline as this isn’t just a one-off. The Baton Rouge gambling market, for example, fell 18.7 percent from February 2018 to February 2019.
If this continues, expect to see possible cutbacks from the casinos. Five casinos already have proposals to cutback and reduce the number of employees. While those numbers have to be approved by the board, it has to be a concern that the casinos are already moving in that direction.
On the flip side, the state could do something like legalize sports betting, which would then give its casinos a competitive advantage. The idea of was up for debate but the state decided not to legalize it. The state could revisit that idea in hopes of presenting new offerings to the customers to get them back in the door.