Louisiana Casinos July Revenue Battered on the Bayou by Barry

Posted on: August 17, 2019, 05:00h. 

Last updated on: August 17, 2019, 11:33h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Gross gaming revenue (GGR) at Louisiana casinos and racinos got all wet in July, slumping nine percent, as Hurricane Barry prevented tourists from visiting New Orleans in the middle of the month and kept local gamblers at home.

Harrah’s New Orleans, one of Louisiana’s biggest casinos. Revenue fell there in July. (Image: Eater NOLA)

The state’s 20 gaming properties generated a combined $202.1 million in revenue last month, down from $222.4 million in July 2018, according to the Louisiana Gaming Control Board (LGCB). There are 15 riverboat casinos, four racinos, and the land-based Harrah’s New Orleans operating in the Pelican State. Baton Rouge, the state’s capital, is one market where gaming venues have been scuffling.

Winnings at Baton Rouge’s three riverboats dropped from $19.9 million to $18.1 million,” reports The Advocate. “The market hasn’t posted a year-to-year increase in casino revenue since August 2017.”

Barry, the first hurricane to make landfall in the US this year, wasn’t a catastrophe on par with some other hurricanes that have hit the Gulf Coast region in the past. But the specter of high winds and severe rainfall was enough to dampen tourism in the Big Easy and visits to other gaming properties in Louisiana.

Last month, Harrah’s New Orleans, operated by Caesars Entertainment, admitted nearly 361,000 patrons, down from almost 485,000 in July 2018, according to LGCB data. The state’s riverboat casinos saw visitor count dip to 1.77 million in July 2019 from 2.02 million a year earlier.

Important Driver

Tourism is a major contributor to Louisiana’s economy, and the state’s casino gaming offerings contribute to that. Pelican State gaming properties have a major fundamental factor in their favor: the state borders Texas. The second-largest US state is thin on gaming properties, but some of its largest population centers, such as the Dallas-Fort Worth metroplex, are short drives to Louisiana,

The Lone Star State doesn’t break out exact figures, but it is estimated that Texans wager hundreds of millions of dollars annually at Louisiana and Oklahoma casinos.

Last year, Louisiana attracted a record 51.3 million tourists, who spent $18.8 billion there while generating nearly $2 billion in receipts for the state. Travel and leisure, including casinos, employs more than 237,000 citizens in the Pelican State.

Missed Opportunity

While Louisiana’s casinos and racinos can recover from one bad month at the hands of an unexpected storm, the state did miss an opportunity to approve sports betting this year. Thanks to political infighting, policymakers there couldn’t get either daily fantasy sports or sports wagering approved in the most recent legislative session, and it could be 2021 before the matter is taken up again.

That’s significant, because sports betting is booming across much of the US. But Texas is unlikely to approve it anytime soon, meaning Louisiana is missing out on luring the sports bettor over the state line from major cities such as Dallas-Fort Worth and Houston.

Sports betting’s lack of traction in Louisiana appears to be a political matter, not an operational issue. Several of the casino operators in the state, namely Caesars, Eldorado, and Penn National Gaming, are among the largest sports wagering, brick-and-mortar and online, purveyors in the country.