Casinos have been around for as long as anyone can remember. They have been presenting people with an opportunity to tempt fate while having an exciting and thrilling time playing games of chance. For a long time, the US has been the recognized playing ground for both amateurs and professional casino players with Las Vegas lording it over some of their competitors in Europe and elsewhere. But recently, there has been worldwide development in new areas, like Macau and Singapore in Asia, which has opened up as new international casino destinations in the Far East. Considering these recent movements in the global casino environment, it would be interesting to take a look at how much revenues are generated and where these casinos stand in the overall picture.
Global Casino Overview
The US is the dominant force in the casino industry even while experiencing a small setback due to the recession and the economic crisis that has plagued the nation during the recent years. In 2010, it reached over US$57 Bn in gross revenues which was a little over 1% change from 2009. In 2011, the numbers grew by 3.5% earning almost US$59 Bn in revenues. The Las Vegas Strip casino and gaming industry earned around US$6.07 Billion in 2011 alone. Atlantic City, on the other hand, has experienced a steep decline in 2010 and 2011 with many construction projects stalled and casino building renovations postponed. It is also facing stiff competition against newcomers Pennsylvania and other nearby states.
The European Market, particularly Italy and Malta are more receptive to the gaming industry and as such, both have experienced steady increase in gross revenues from the gaming sector. France, on the other hand, has set stringent laws that affect the growth of the gaming industry. The economic crisis has also restricted the spending capacity of people which led to the decline in revenues. The United Kingdom (UK) appears to be on standby and awaiting the effects of the recent smoking bank and increased tax rates on their gaming industry. In the previous years, the revenues have been consistently dropping even though there are still regional casinos expected to be approved and opened.
The Asian Market is the emerging new player in the global casino playground. Casinos in Macau and Singapore, even Vietnam, are showing signs of aggressive behavior and some even say that they have the potential to overthrow Las Vegas as the World’s Casino Destination.
Casinos are highly dependent on the economy of a country. When the people are in crisis, they have a tendency to NOT spend their hard earned cash which cannot bode well for the casinos. The whole world is waiting if countries are going to recover from their respective economic crisis in the hopes that revenues will continue to steadily rise in the future.
Top Global Casino Companies (By Revenue, in Billion US Dollars)
Though it’s easy to see why Las Vegas in the United States is perceived as the top casino destination in the world, the numbers sing a different tune when you look at it from the casino company’s point of view. For instance, if you look at the year 2011, the highest revenue earner for this year was SJM Holdings of Macau. SJM Holdings, or Sociedade de Jogos de Macau S.A., is one of six companies authorized to operate casinos in Macau. To date, it has 17 casinos, 3 slot machine lounges and 1 hotel in Macau and Taipa Island. Together, these casinos have brought in US$9.7Bn in 2011.
The second top earner in casinos worldwide is Las Vegas Sands Corporation. The Las Vegas Sands Corporation owns and develops high-end properties complete with accommodations, gaming and entertainment, convention facilities and restaurants and clubs. To date, it owns The Venetian (Las Vegas), The Palazzo (Las Vegas), the Marina Bay Sands in Singapore and through its subsidiary, The Venetian Macao, The Plaza Macao and The Four Seasons Hotel Macao. Las Vegas Sands Corporation has raked in US$7.4Bn in 2011.
In the third rank among global contenders in the casino market, Caesars Entertainment holds steady at US$6.2Bn in 2011. Caesars Entertainment has been in the business for 70 years and has numerous hotels and casinos under its belt. The company’s resorts operate under the brand names Harrah’s, Caesars and Horseshoe, including the World Series of Poker and the London Clubs International casinos.
Vegas vs. Macau
If you were to compare the revenues of Las Vegas and Macau for 2011, you’ll be surprised to find out that Macau has a considerable lead over Las Vegas. It has combined revenues of US$28.6Bn for 2011 compared to Las Vegas Strips’ US$6.07 Bn.
If the forecasts are correct, Las Vegas will have tough competition in the coming years from new players in the Asian market. These offer new casinos and new destinations to cater to both amateurs and professional players.
All data and statistics based on Bloomberg
Image was kindly provided by Sean MacEntee