A 34.5% Revenue Drop in February for New Orleans Casinos

Harrahs – New Orleans” by javacolleen is licensed under CC BY-NC-ND 2.0

The world might be shifting back towards some form of normality, but that hasn’t caused the pain to subside for Louisiana’s casino operators. Revenue figures have just been released for February and they show that despite casinos welcoming punters through the doors again, turnover is down by more than a third compared to the same month last year. 

The reason is likely to boil down to a combination of factors. Tourism, in general, is still stagnating, as many people continue to stay at home, while social distancing measures have reduced casino capacities by around 50 percent. There is also a feeling within the industry that casino enthusiasts in New Orleans are following the rest of the world to options in cyberspace, despite Louisiana’s strict regulations on the subject. 

Unlicensed casinos tempting gamers online

Louisiana’s gambling laws are among the stricter in the US, at least as far as internet betting is concerned. In most states, the rules apply strictly to the operators, meaning that betting online per se is not an offense, but providing the facilities for people to do so is. However, Louisiana is one of just two states in which there are penalties for players too – gambling online is a misdemeanor offense carrying a maximum fine of $500. 

Yet despite these risks, it seems probable that a good portion of New Orleans casino players has been using unregulated online casinos over recent months. It remains to be seen what kind of permanent effect Covid closures will leave on local casinos in New Orleans. 

Mardi Gras closures 

There’s also the impact of this year’s restrictions during Mardi Gras. The cancellation of the traditional parades was a disappointment to residents, but it also hit local businesses hard. This included New Orleans casinos, which would ordinarily have expected a major spike in revenue during the festivities. 

The downturn over the Mardi Gras period was further exacerbated by the big freeze that swept across Louisiana at the same time. The timing could not have been worse, and some riverboat casinos had no option but to shut down completely for several days. Those that were able to open welcomed only the most hardy and determined customers, as icy roads and bridge closures made venturing out to them a gamble in itself.

A look at the numbers

All these factors added up to statewide casino revenue of just $151 million, compared with just over $212 million in the same month last year. The largest, and the only land-based casino in the state, Harrah’s was hit even harder than the rest, with total takings of $15.8 million. That’s a drop of more than 40 percent compared with February 2020. 

Over at Fair Grounds race track, it was the same story, with the slots taking in $2.9 million compared with $4.5 million last year. Treasure Chest and Amelia Bell riverboats were also down by about 35 percent, the latter having been hit particularly hard by the big freeze. In fact, Boomtown was the only gambling facility that managed to weather the storm, both literally and commercially, relatively unscathed, taking just under $9 million. It’s still a drop compared with the $10.7 million revenue reported last year, but a less severe one than the rest.

Video poker as popular as ever

Gambling enthusiasts will know that video poker is something of a special case in Louisiana. The terminals are permitted in 31 of the state’s 64 parishes and can be found in taverns, truck stops and the like. The revenue they generated in February was $53.6 million statewide, only marginally down on the $54.9 million last year. In view of the weather conditions and the Mardi Gras cancellations, that has to be seen as one of the few wins for an industry that has had precious little to celebrate in recent months. 

Looking ahead

These are changing times in the world of gambling. The supreme court decision to strike down PASPA a couple of years ago brought the topic of sports betting to the top of every state’s agenda, and legislative reform relating to casino gaming has inevitably become part of the same conversation in many states. 

Louisiana lawmakers have stressed the need for the state to stay in step with neighbors with regard to sports betting, and many state parishes are expected to approve its legalization over the coming months. Inevitably, internet-based betting will be a major part of that discussion. 

The question of a legislation for an online casino network in Louisiana would be the logical next step, but that still seems to be some distance in the future. Having said that, events over the past 12 months have caused rethinks on a variety of issues and led to some decisions that would have seemed inconceivable at the beginning of last year – right now, anything is possible.

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