Written by :
Published on :
Ohio’s casinos might have generated record numbers in a few months last year. But overall, the casino and racino industry suffered a $500 million profit dip due to mandatory lockdowns caused by coronavirus concerns.
Gov. Mike DeWine issued an order to close Ohio casinos full-time in mid-March, a ban he later lifted in mid-June. Owing to this, profits for casinos were impressive in January and February but nosedived to zero for the three months they couldn’t open.
Beginning July, the gambling establishments bounced back by registering record numbers. But as we’ve outlined below, nothing could save the brick and mortar casino industry from harsh losses last year.
A 26% Drop in Annual Revenue
According to the Casino Control and Lottery Commission, the Ohio Casino industry recorded a 26% profit drop compared to 2019. Precisely, the industry’s annual revenue totaled $1.44 billion, $500 million less than the $1.94 million made in 2019.
The biggest casinos in Ohio hade the biggest profit downturns. MGM Northfield Park, for example, made $171.7 million, $80 million less than it recorded in 2019. Cleveland-based Jack Casino, on the other hand, made $152.2 million, $62 million less than 2019.
The upside of Ohio’s top casinos is that they made profits at the end of the year even though it might not have been as much as they made in 2019. Presently, they’ve also reopened, meaning they will probably make record profits this year.
If you’re interested, you can find a list of Ohio casinos from casinos.us. The website shows you a map of where each gambling business is located, games offered, size and services like dining, shows and live concerts. Feel free to visit any of the casinos, more so, top-rated establishments. That’s where you’re likely to have the best experiences.
Up to $135 Million less in Tax Revenues
Job losses, safety concerns, reduced profits and low tax income—these are some of effects of COVID-19 to the Ohio casino industry. On average, these businesses send one-third of their gross annual profits to the state government as tax.
In 2019, the entire industry’s contribution to the state coffers amounted to $646 million (1.94B divided by three). Last year, the income the state’s tax revenue from casinos plunged to $480 million, about $166 million less.
This explains why Gov. DeWine was one of the first governors in the country to reopen the casino industry in June. He understood the impact closing these businesses full-time would have on the state budget. So, he relaxed his measures to let casinos operate until 10 pm, usually by following standard safety measures.
Slots and Table Games Suffered Equally
After the CDC directed states to ensure businesses to follow social distancing measures last year, many casinos thought table games would be hit the hardest. It makes sense: table games bring players together around a table. As such, you would think many card players would shy away from casinos.
As it turns out, both table games and slots suffered in equal measures, at least in Ohio. The total revenue for slots was $44 million, seven million than the $51.4 million casinos earned in 2019. By comparison, table games brought in seven million less than they did in 2019--$15.9 million, down from $23 million.
The explanation is that all casinos in Ohio had to enforce similar measures to both slot and card game players. In the slot section, observing social distancing meant removing some machines. On the other hand, they would use fewer tables and keep them far apart.
Racinos Mainly Relied on Slots
After the pandemic forced many horse racing organizers to cancel events, some racinos nearly shut down permanently. Fortunately, many of them also offer slots. And starting June, both casinos and racinos had the chance to provide slot games although at reduced operation.
That said, racinos made $72.7 million from slots in 2020. Of course, this was a decline from the year before, when they made $94.9 million. Belterra Park, made the least amount of money from slots in Ohio at $5.7 million. In all fairness, it also trailed other racinos in 2019.
By comparison, MGM Northfield Park topped the racino section by making $14.2 million from slots. This was roughly $8 million from the $22.2 million it earned in 2019. Eldorado Scioto Downs came in second at $12.8 million, down from $15.7 million in 2019.
A Six Year Low for Ohio Casinos
To understand just how much COVID-19 impacted casinos in Ohio, keep in mind that Ohio casinos have not made less than $1.45 billion in revenue since 2014. What’s more, they haven’t suffered a dip in the last eight years.
The state’s casino industry first made over $1 billion in 2013, recording $1.07 from a meager $430 million in 2012. In 2014, the figures jumped to $1.46B. Since then, the sector has been growing gradually until it hit $1.94 billion in 2019.
To be clear, there have been reasons for casinos to make losses over the years. For example, online casinos became popular in the country. On the flip side, sports betting became legal in many states. Still, Ohio’s gambling fans remained loyal to local casinos until the pandemic forced them to stay at home.
Ohio Casinos: What’s the Way Forward?
After the revenue declines of last year, Ohio Casinos are hoping 2021 will prove to be a better year. And sure enough, there are signs things will get better. For starters, vaccine distributions for COVID-19 are underway, providing hope the pandemic will come to an end.
That said, the Ohio state suffered massive budget cuts due to the pandemic and it will need new revenue sources to recover. One great option would be to legalize online casinos. Some states have done it and collect millions of dollars in revenue.
It could also authorize sports betting, the industry through which New Jersey made $400M+ in tax income in 2019. In total, the NJ sports betting sector is worth $5 billion, and 80% of the money comes through mobile bets.
