Las Vegas gambling revenues dip slightly in April

The Las Vegas Convention and Visitors Authority said tourism posted its 14th straight monthly increase.

JP Morgan gaming analyst Joe Greff told investors in a research note that state gaming results were hurt by methods regulators use to count slot revenues. Gaming Control Board senior research analyst Michael Lawton calculated that with normalized slot machine reporting figures, both the state and the Strip would have shown monthly revenue increases of about 1.4 percent had April 30 - which fell on a Saturday - been counted with April revenues.

Lawton said casinos count slot revenue five days a week, typically avoiding weekends because they don't want to interrupt the flow of gambling. "It's kind of a complicated month," Lawton said.

This boost in April's visitation came despite a rise in gasoline prices, which topped us$ 4 a gallon in the Southern California market. The car count at the state line at Primm rose 3.4 % from a year ago.

Analysts said last Thursday they still saw positive signs in the numbers released by the state Gaming Control Board during April even though statewide gaming revenue totals were mixed, especially in Clark County. "Even though April results were somewhat soft, we continue to believe that the Las Vegas market is in a gradual recovery," Wells Fargo Securities gaming analyst Dennis Farrell Jr. told investors.

Statewide, casinos collected us$ 806 million from gamblers, a 0.58 percent decline compared with us$ 810.7 million collected in April 2010. Strip casinos collected us$ 427.5 million in gaming revenues during the month, a decline of 2.2 % compared with us$ 437.3 million in the same month last year.

On the Strip, baccarat revenues fell 3 % to us$ 56.8 million while the amount wagered on the game, us$ 490.4 million, was down 29 %. That brought a note of caution from another analyst. "We view April results as slightly disappointing," Rodman & Renshaw gaming analyst Robert LaFleur told investors. "It clearly looks like the strength in high-end international play has moderated from past years."

Clark County casinos as a whole saw gaming revenues decline 1 %. Casinos located in the reporting area known as the balance of the county said gaming revenues grew 8 percent. Downtown gaming revenues were down 5.6 % and North Las Vegas casinos reported revenue declines of almost 8 %. Boulder Strip gaming revenues were up 2.5 %.

Lawton noted that April slot machine wagering volume on the Strip was up almost 1 percent in April, the second straight month slot machine wagering showed an increase. He said Strip slot figures were the first consecutive monthly increases since July and August 2007.

Macquarie Securities gaming analyst Chad Beynon said the figure was an encouraging sign for the Strip. "We view this as the more important metric in evaluating slot gaming trends and believe the growth in handle is a positive data point for non-gaming spend and hotel fundamentals," Beynon said.

April's decline reversed increases seen in the previous month. In March, statewide gaming revenues rose 5.1 % after four straight monthly declines. For the first four months of 2011, gaming revenues are down 0.8 % both statewide and on the Strip. But Las Vegas visitor volume in 2011 is up 5 % through April.

Convention attendance during April, a major contributor to the improving numbers, rose 2.2 %. By contrast, the number of conventioneers increased 8.8 % during the first four months of this year. With the number of hotel rooms almost flat, occupancy rose 3.7 percentage points to 87.7 %. The average daily room rate hit us$ 105.67 in April, up us$ 8.80.

Gaming taxes collected in May based on the April gaming revenues were us$ 42.6 million, a 7.25 % increase from a year ago. For the first 11 months of the fiscal year, gaming tax collections are up 1.9 %. Casino taxes account for about a third of state general fund revenues.

Several analysts said they expect May to be a positive month for the Strip and the state. Memorial Day Weekend helped boost room rates while several special events, such as the Manny Pacquiao and Shane Mosley championship fight at the MGM Grand on May 7 drew free-spending customers.