|
 Vegas Offers
First Glimpse Into
Recession
Gambling recession
proof. Don't
tell that to the
folks in Las Vegas.
The looming
recession is already
starting to hit Sin
City hard.
Analysts are saying
this is among the
first signs that
people are less
willing to travel
now.
MGM
Mirage Inc announced
earnings dropped to
$118.3 million, or
40 cents per share,
compared with $168.2
million, or 57 cents
per share, in the
same quarter a year
ago.
"They're not what
they were last year
and they're not what
they will be next
year, but they are
what they are now
and we're dealing
with it," MGM Mirage
CEO Terry Lanni told
The Associated
Press.
Revenue for the
world's
second-largest
casino company
slipped 3 percent,
to $1.88 billion
from $1.93 billion
in the same period
in 2007, and fell
short of
expectations of
analysts surveyed by
Thomson Financial.
MGM
is far from the only
casino company
witnessing financial
strife.
Tropicana
Entertainment, owner
of 13 casinos in Las
Vegas and Atlantic
City, as well as
several smaller
regional venues, has
filed for
bankruptcy.
The whole casino
industry has been
hit hard by the
credit crunch, with
less tourism, and
visitors tightening
their belts. Casino
revenue is down
almost 10% year on
year.
A
glimpse of things to
come: Following the
events of 9/11, the
stock value of the
entire Mandalay
Group (which at the
time owned among its
properties Mandalay
Bay, Luxor and
Excalibur) dropped
lower than the cost
to build the Luxor.
And there were
layoffs at the major
casinos followed by
the Aladdin filing
for bankruptcy.
The
likely
beneficiaries:
Online gambling
firms which do not
require travel or
extra spending cash
outside of that
which individuals
actually plan to use
for the purpose of
gambling. And,
yes, people will
keep gambling during
a recession.
They just won't
travel by plane to
do so.
-----
Christopher
Costigan,
Gambling911.com
Publisher
CCostigan@CostiganMedia.com
Originally published
May 7, 2008 12:06 pm
EST
|
