askatchewan Gaming Corporation, SaskGaming, reported a loss of CAD $13.4 million (USD $10.76 million) for the 2020-21 fiscal year. The details are contained in the Crown Corporation’s annual report. It is the first time the public casino operator has lost money in its 25-year history.
The operator of Casino Regina and Casino Moose Jaw, a Crown corporation owned by the Government of Saskatchewan, said on Monday that the COVID-19 pandemic was the source of the financial losses.
SaskGaming president and CEO Susan Flett said in a news release on Monday: "This reporting year was unlike anything SaskGaming has experienced in 25 years of operation," reports CBC News.
Casino Regina and Casino Moose Jaw were forced to close for nearly seven months as a result of the pandemic, and the modest revenue made when they were permitted to open with restricted capacity was unable to offset the losses. Due to the closures, approximately 570 permanent employees were temporarily laid off, SaskGaming said.
The company's fiscal year began two weeks into a four-month-long closure of both of its casinos. Even when they were cleared to reopen in July 2020 with limited capacity, 318 at Casino Regina and 69 at Casino Moose Jaw, there were additional limits, including reduced food and beverage services, reduced hours, and increased cleaning of high touch surfaces. The strict regulations made it harder for the Crown corporation to make money.
Despite the challenges, the company was able to earn a profit during the second quarter of the year, but a spike in COVID-19 cases in November meant more restrictions before a second closure of the casinos was enforced in December. It remained that way for the rest of the fiscal year.
As a result, revenue fell to just CAD $30.9 million (USD $24.81 million) in 2020-21, compared to the CAD $114.1 million (USD $91.60 million) raked in the year before.
Although expenses dropped as a result of temporary layoffs, it wasn't enough to make up the deficit caused by CAD $44.3 million (USD $35.56 million) in expenses.
SaskGaming said it is hopeful that its properties will become fully operational and back to normal when the province's COVID-19 restrictions are relaxed. However, due to the uncertain and "continually evolving" nature of the pandemic, SaskGaming declined to give a forecast for the current 2021-22 fiscal year.
SaskGaming's losses may have a ripple effect beyond the direct operations of the Crown corporation. Normally the public casino operator pays 50% of its net income into the province's general revenue fund. Then, 80% of the rest is provided to its holding company, Crown Investments Corporation (CIC), in the form of a dividend.
Due to this year's losses, no payment was made into either fund and SaskGaming actually received CAD $4 million (USD $3.21 million) from the CIC.