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Coronavirus has brought casino industry 'to a near standstill'

Mar 21, 2020, 11:01 am

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GamblingGambling: Coronavirus has brought casino industry 'to a near standstill'Rating:

The Covid-19 coronavirus has effectively quarantined the nation's gaming industry.

More than three dozen states with commercial casinos or Indian gaming facilities have taken actions to suspend casino operations, enacted limitations that led to a shutdown, or have seen gaming companies and tribal leaders independently close their properties.

By late Tuesday, MGM Resorts International — one of the nation's leading gaming companies — will no longer have a casino property in operation in the U.S.

"We're clearly entering uncharted territory here with casino closures," SunTrust Bank gaming analyst Barry Jonas said in an email Monday.

New York, New Jersey, Pennsylvania, Louisiana, Colorado, and Mississippi have seen their governors or state gaming regulators order temporary closures.

MGM on Monday closed the Borgata in Atlantic City after Governor Phil Murphy's directive and later decided to suspend operations at Beau Rivage and Gold Strike in Mississippi ahead of Mississippi Governor Tate Reeves' edict to do so.

The coronavirus has silenced MGM's 20 properties in the U.S., including 13 in Las Vegas. Some 70,000 MGM employees in the U.S. were sidelined while 30,000 slot machines and 1,400 table games went unplayed.

On Sunday, MGM and Wynn Resorts said they were voluntarily closing more than a dozen Las Vegas Strip properties to help stem the viral outbreak that has gripped the nation.

"Given that there isn't a mandate for Las Vegas casinos to close yet, I think it speaks strongly about MGM and Wynn management protecting both its employees and customers; though at a certain point there may not be a commercial argument to stay open," Jonas said.

MGM is far from alone in its pain.

Through Monday, Penn National Gaming has closed 24 casinos in 11 states, impacting more than 17,325 employees. The company has 41 gaming properties in 19 states. CEO Jay Snowden said Penn will pay its full-time workers through the end of March.

Over the weekend, Boyd Gaming Corp. closed five casinos in four states. Monday's actions in Mississippi and Louisiana means another four properties will be closed for a company that has 29 casinos in 10 states.

Eldorado Resorts closed 10 casinos in seven states, including three properties each in Mississippi and Louisiana.

Meanwhile, more than a dozen states with casinos have yet to shut down operations. On the Las Vegas Strip, many casino operators are closing amenities, such as retail outlets, restaurants, swimming pools, nightclubs, and lounges — or reducing operating hours — in order to reduce staffing levels.

"The clear question now becomes how long can the entire industry stay in business with casinos closed (or even open) while coronavirus dictates our daily lives," Jonas said.

Layoffs and furloughs becoming a concern in Las Vegas and other markets

American Gaming Association CEO Bill Miller said state governments and elected leaders need to support casino workers and the ancillary businesses that will "bear the brunt" of the shutdowns.

"In a matter of days, the U.S. casino industry went from a growing, thriving segment of the U.S. economy to a near standstill," Miller said in an emailed statement. "We are witnessing a rapidly increasing number of our nation's commercial and tribal casinos that have been shuttered, impacting 40 percent of all casino employees. This will have a dire effect in the communities in which we operate across 43 states. Our immediate priorities are actions that provide liquidity to allow us to support employees."

Nevada Congresswoman Dina Titus, the co-chairwoman of the Congressional Gaming Caucus, whose district includes the Las Vegas Strip, said employees in the gaming capital are facing uncertain times.

"The Strip will not be the same for now, but it will come back stronger," Titus said. "This will get worse before it gets better, but it will get better. Our city is a resilient one and soon we will prove that once again."

Financial hit

On Monday, the Dow's nearly 3,000-point decline and President Donald Trump's declaration that coronavirus could last until July or August frightened both the investment community and gaming leaders.

"It is amazing how quickly this country has talked its way into a potential recession and brought the gaming industry to a temporary halt," said Global Market Advisors partner Brendan Bussmann.

The market declines were stunning in many senses. MGM stock lost 33.61% of its stock value to close at $10.25. Penn National was down 44.8% to close at $8.54. Boyd Gaming's value dropped 29.34% to close at $10.84.

The $17.3 billion merger between Eldorado Resorts and Caesars Entertainment has several analysts pondering whether the plan to close the deal in  first half of this year is still possible. Eldorado fell 24.37% to $13.78 while Caesars was down 28.39% to $6.08.

Several companies began drawing down unused credit lines to help cover costs, according to filings with the Securities and Exchange Commission.

Caesars Entertainment said it has fully drawn the remaining available capacity under three credit facilities, totaling more than $1.15 billion in debt. Churchill Downs told creditors it was drawing down $700 million in debt while Penn National borrowed the remaining $430 million of its credit line.

"The company elected to draw down the remaining available funds... to ensure it maintains ample financial flexibility in light of the spread of coronavirus," Penn said in the filing.

Deutsche Bank gaming analyst Carlo Santarelli said the discussions around gaming companies will soon cover liquidity and capital resources "and the ability to stem the tide of the closures."

CDC Gaming Reports

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24 comments. Last comment 7 months ago by dpoly1.
Page 1 of 2
Avatar
Michigan
United States
Member #203771
January 17, 2020
423 Posts
Offline

Yeah this is ill I knew as soon as they said they 3 Casinos here in Detroit were shutting down its was about go be a landslide in the economy...ike Everyone else I'm just sitting back waiting likeWhat?

    Avatar
    Maryland
    United States
    Member #162429
    January 2, 2015
    2294 Posts
    Offline

    Maybe this is good for the casino industry?  There seems to be WAY too many casinos in most states, so a shakeup could be good.  In Delaware alone there are 3, plus one near Ocean City Md which is not far from Delaware.   The population for Delaware is a little less than 1 mil.

    MD has plenty and is talking about adding slots to the Preakness horse racing track. (unless they already have them? I dont go there)

    I know NY just added a bunch of casinos way outside of NYC. They already had most of the major city's/metro area's covered for casinos. 

    This way the ones that survive can offer more and better things for players.

    Oh, and we BETTER NOT hear about a bailout for this industry Rant

      CDanaT's avatar - Nolz june15.jpg
      Central TN
      United States
      Member #121189
      January 4, 2012
      4772 Posts
      Offline

      Got my notice of cancellation from  for my trip to Vegas on Wednesday 3-18. They advise me that that my reservation is "automatically cancelled" due to the current outbreak. Course they want to "credit" me for 90 days, to which I requested a full refund.

       

      Then 2 days later they send me a notice saying this,

       "We apologize for the delay in response. Due to current events we are experiencing a high volume of communications resulting in longer than normal hold times and response times for emails. Currently there are no cancellation fees for your vacation package. However, there is the potential of a cancellation penalty with the hotel if the booking has not been cancelled by March 26th. To cancel or change the reservation, it is recommended to call our reservations center at 1-800-blah blah blah. We are currently experiencing longer than usual hold times, but we do advise continuing to hold the line to ensure you are answered and you do not lose your place. We apologize if this causes any inconvenience. If we can be of any further assistance, please let us know.

      Hey geniuses,which one is it ? Fully cancelled or now partially cancelled ?  Mad

      Integrity: There is just no substitute.

        Avatar
        Louisiana
        United States
        Member #191895
        August 27, 2018
        675 Posts
        Offline

        Instead of going to a casino, I would assume people would just play their state's lottery games? I use a automatic vending machine with vinyl gloves on to touch the buttons. I stay away from the clerks, & patrons there. Thankfully, no one was in line behind me!

        All number sets are contenders until the drawing occurs.

          dpoly1's avatar - driver
          PA
          United States
          Member #66139
          October 16, 2008
          1991 Posts
          Offline

          AND

          Pennsylvania closed all of the lottery offices!

          SO, if you win a large jackpot, how do you collect?

          dpoly1 - Playing the lottery to save the jobs of those that build, transport, sell & maintain luxury items! -

           

          Eschew Poverty ........... Vote Conservative!

            brees2012's avatar - animal whale.jpg

            United States
            Member #125173
            March 26, 2012
            287 Posts
            Offline

            People will start ( if they haven't already ) , saving $$$$ , paying off bills ,

            continue to look for groceries , etcccc.

            Even if somebody won the lottery , doubt they could get their money at the

            normal time. 

            Ready To Win ....

              Avatar
              Louisiana
              United States
              Member #191895
              August 27, 2018
              675 Posts
              Offline

              AND

              Pennsylvania closed all of the lottery offices!

              SO, if you win a large jackpot, how do you collect?

              Jason Kurland | The Lottery Lawyer | Attorney for Jackpot Winners

              Let him handle the theatrics of claiming the ticket for you. Put it in his hands.

              All number sets are contenders until the drawing occurs.

                greatguy's avatar - peace
                Cali
                United States
                Member #198167
                May 13, 2019
                107 Posts
                Offline

                Just left there from a Strip Hotel on Thursday morning.  Please Pray

                for those workers in L.V. , my Taxi driver that took me to the Airport said

                "Your my first ride all day."  He was in line since 7 am. Picked me up at 10 am.

                ~Keep the Peace~ Gg

                  Avatar
                  Simpsonville
                  United States
                  Member #163184
                  January 22, 2015
                  2281 Posts
                  Online

                  We went to Caesars Southern Indiana seven days ago saying they were closing and would comp us for Jack Binion's.  Were sort of near there doing taxes (and refund came already!) so we did go there.   The employees told us they would get paid while closed for what was then two weeks.   Will find out if the state keeps them closed if they still got paid the whole time.   I think not. 

                   

                  Thankfully still no kids in my former job @ PICU on ventilators with Coronavirus.   We've had that (genus) virus before, but not this particular strain.   As many of you know, I would hope, that all viruses, like bacteria mutate.

                    Rman313's avatar - Lottery-062.jpg
                    Inkster, MI
                    United States
                    Member #142368
                    May 10, 2013
                    5975 Posts
                    Offline

                    Hello everyone! I work for MGM Grand Detroit as a Heavy Porter Cleaner. Because of my seniority I did not get laid off as of now. I am part of a  crew of cleaners who is doing heavy cleaning throughout the property. We are using this time to clean, disinfect all areas in the building. It's a lot of work! This Covid-19 is only temporary. This too shall pass!! We as Americans and the world will survive this!!🇺🇸

                    You can do anything if you put your mind into it. The sky is the limit! Cool

                      Todd's avatar - Cylon 200.jpg
                      50
                      Chief Bottle Washer
                      New Jersey
                      United States
                      Member #1
                      May 31, 2000
                      25869 Posts
                      Offline

                      Hello everyone! I work for MGM Grand Detroit as a Heavy Porter Cleaner. Because of my seniority I did not get laid off as of now. I am part of a  crew of cleaners who is doing heavy cleaning throughout the property. We are using this time to clean, disinfect all areas in the building. It's a lot of work! This Covid-19 is only temporary. This too shall pass!! We as Americans and the world will survive this!!🇺🇸

                      Awesome, glad you're still employed and thanks for the information "on the ground" there.  Stay safe!

                       

                      Check the State Lottery Report Card
                      What grade did your lottery earn?

                       

                      Sign the Petition for True Lottery Drawings
                      Help eliminate computerized drawings!

                        Rman313's avatar - Lottery-062.jpg
                        Inkster, MI
                        United States
                        Member #142368
                        May 10, 2013
                        5975 Posts
                        Offline

                        Awesome, glad you're still employed and thanks for the information "on the ground" there.  Stay safe!

                        Thanks Todd you too!😊

                        You can do anything if you put your mind into it. The sky is the limit! Cool

                          Avatar
                          Shelbyville, KY
                          United States
                          Member #167329
                          July 6, 2015
                          155 Posts
                          Offline

                          Casinos, all forms of gambling are ceased in my house ... hold on to your money folks, casinos aren't going anywhere, casinos are ready to make up their billion dollar losses when its over!  Take this this time to bank up, pay down, pay off debt, use wisdom.

                          Get em!

                            Avatar
                            Austin
                            United States
                            Member #191205
                            July 21, 2018
                            43 Posts
                            Offline

                            In Texas, you can now redeem by mail a prize up to $5mil. However, anything over that you would have to make an appointment.