Casino slot revenues off to a strong start
On a per-machine basis, Plainridge leads way
GAMING IS BACK in Massachusetts and the casinos are open and ready for business and patrons appear to be ready, willing, and able to play. Plainridge Park reopened on July 8 and both MGM Springfield and Encore Boston Harbor reopened on July 10. We now have some gaming revenue numbers to examine and try to figure out what they mean.
When we talk about monthly slot revenue numbers, the first thing that we need to do is to compare apples to apples and oranges to oranges. The only way to properly do that is to divide the total monthly slot revenue by the number of gaming days and then by the number of machines. This gives you an average daily revenue per machine, expressed as pmd, or per machine day.
Both MGM Springfield and Encore Boston Harbor opened on July 10 and were in continuous operation for 22 days. Plainridge Park, a slots-only facility, opened on July 8, but closes from 2 a.m. to 7 a.m. on Sundays through Thursdays, and is open continuously on Fridays and Saturdays, which yields 20.46 days of continuous operation in July. Because of social distancing concerns, a number of machines at each facility are closed. For Plainridge Park, which normally has either 12,50 or 1,500 slot machines (depending on how you count multiplayer virtual blackjack, roulette, and poker machines), the facility has an average of 789 machines in operation. Similarly, MGM Springfield, which normally has 2,550 slot machines, now has an average of 892 machines in operation (34.98 percent of the total) and Encore Boston Harbor, which normally has 3,158 machines, now has an average of 1,856 machines in operation (58.77 percent of the total).
Massachusetts Slot Revenues
|Gaming Venue||Gaming Days||Slot Revenue||No. of Machines||Machine Revenue (per day)|
|Encore Boston Harbor||22||16,266,468.65||1856||398.38|
Using machine revenue per day as a yardstick, Plainridge Park leads the pack with $479.56 per machine per day, which is a great number. Anything above $300 per machine per day, according to the gaming industry standard, is strong and an indicator of a healthy gaming market. When pmd numbers get down around $200, operators get concerned about saturation in the region. Similarly, MGM Springfield is in a strong second place with $458.04 per machine per day. Encore Boston Harbor is still doing well, but it is in third place at $398.38 per machine per day.
These numbers seem to indicate a large degree of pent-up demand for gaming. But there are other possible reasons for these high numbers other than the lack of operating gaming facilities for the last 3 ½ months. For example, one reason for MGM Springfield’s high slot revenue numbers may be the fact that the upstate New York commercial casinos – except for some tribal casinos in western and central New York – remain closed due to COVID concerns. The Massachusetts slot revenue numbers are still below those for the same period in 2019, but that could be due to the partial month of operations.
As a basis for comparison, Mohegan Sun – which reopened in early June – had $47.5 million in slot revenue in the month of July. This amount is almost $800,000 above what it earned in July 2019, even though only 2,529, or 61 percent, of its 4,095 slot machines were available. That comes out to nearly $606 per machine per day, a very impressive number.The major question is will this trend continue? In the past we have seen huge revenue numbers when a new gaming facility opens, but the numbers tend to decline over time. Will concerns over COVID and procedures designed to encourage social distancing and limit the spread of the virus cause a more precipitous drop in slot revenues? Only time will tell.
Paul DeBole is an assistant professor of political science at Lasell University.