Pennsylvania Casinos Report 1% Revenue Fall in September

Pennsylvania Casinos Report 1% Revenue Fall in September

Pennsylvania’s casino market generated a combined $268.5 million in September, marking a 0.92% decline compared to the same month in 2017. From that total, slot machines posted a moderate 0.4% year-on-year gain to $196.2 million, while table game revenue dropped by almost 4.4% to $72.3 million. The Keystone State subsequently collected $113.9 million by way of tax revenue, with the 55% tax imposed on slots operations accounting for around 90% of that amount, and the remaining chunk derived from the 14% tax placed on table games.

Casino Revenue Declines

In September, seven out of the state’s twelve gaming operations reported year-on-year revenue drops. Heading the list of decliners was Sands Casino Resort Bethlehem, which saw its overall business plummet by 10.26% to $42.6 million, including slots contracting by 2.5% to $24.2 million, and table games tumbling by a massive 18.8% to $18.4 million in September.

Also noting severe year-on-year revenue falls was Mohegan Sun Pocono down by 8.91% to $18.9 million, and Lady Luck Casino Nemacolin lower by 8.59% at $2.7 million. The state’s other operations, however, reported much smaller drops in their overall revenues, including Hollywood Casino at Penn National Race Course on $19.5 million (-3.65%), The Meadows Casino on $19.6 million (-2.48%), Presque Isle Downs and Casino on $10.9 million (-2.26%), and Harrah’s Philadelphia on $21.2 million (-1.57%).

Meanwhile, Parx Casino was the state’s highest earning casino after generating $49.1 million last month, also representing a 3.66% improvement compared to a year ago. On the other hand, leading the way in terms of year-on-year revenue gains was Valley Forge Casino Resort which posted a huge 10.48% increase to $10.4 million, followed by SugarHouse Casino up by 7.7% at $25.9 million, and Rivers Casino higher by 5.28% at $29.7 million. Reporting the lowest year-over-year gain was Mount Airy Casino Resort, which produced 1.43% more revenue at $17.5 million.

DFS More Than Doubles

Pennsylvania launched regulated fantasy sports in May, and the following month the industry saw its revenue hit $1.3 million. The vertical has failed to ignite since then, though, and in June revenue came in at a little over $1 million, down by 26.7% month-on-month, followed by $878.1 million (-14.7%) in July. There were subsequently signs of a reversal of form in August after the state’s DFS operations collected $943.6 million (+7.2%), but September’s results have proved a high point for the segment with revenue more than doubling month-over month to $2.1 million, thanks to the start of the NFL season.

Revenues are not spread evenly across the state’s nine DFS operators, though, and last month DraftKings accounted for $1.17 million of total revenue, followed by FanDuel with $948,838. Third place was then a long way back with DRAFT on just $19,659, after which business plummets further still, with Boom Fantasy on $1,336, Fantasy Draft on $1,088, Sportshub Technologies on $270, Full Time Fantasy Sports on $241, Fantasy Football Players Championship on zero, and finally Yahoo Fantasy Sports, which managed to make a $12,049 loss in September.

DFS revenue is taxed at a rate of 15%, and last month this translated into an additional $320,057 for state coffers.

Sports Betting This Fall?

The Pennsylvania Gaming Control Board (PGCB) has already received sports betting license applications from five venues, and granted two licenses. If all proceeds as planned, the state may see its first wagers placed in the coming months. Whether the industry takes off like it has done in New Jersey, however, remains to be seen. Standing in its way is an exorbitant $10 million licensing fee, a 34% tax on gross revenue, as well as an additional 2.25% in other taxes. By contrast, New Jersey charges a mere $100,000 per licensing fee, an 8.5-13% tax of gross revenue, and an extra 1.25% towards local share tax.

Needless to say, Pennsylvania has received a deluge of criticism from the casino industry, with some warning that it may lead to an uncompetitive market in which gamblers continue playing on illegal bookmaking sites, or instead travel across the border to Atlantic City to place bets via New Jersey mobile apps.