Making the News

Pittsburgh Tribune-Review

Originally Published:Thursday, January 24, 2008

Whether the $6.6 million statewide fluctuation is typical remains to be seen; Pennsylvania's gambling industry hasn't been operating long enough for a pattern to emerge, said Michael Pollock, managing director of Spectrum Gaming Group, an Atlantic City-based consulting agency.

"Gambling is a function of two things: One is disposable income. The other is time," Pollock said. "People have more time in the summer months."


As thermometer dips, so do casino profits

By Mike Wereschagin
Pittsburgh Tribune-Review

Winter doldrums are taking their toll on casino profits in Pennsylvania, with monthly gross slot machine revenue down $6.6 million from July to December, according to the state Gaming Control Board.

Gambling profits typically fall with the mercury in temperate climates, as fewer people brave slick streets and cold temperatures, analysts said.

Whether the $6.6 million statewide fluctuation is typical remains to be seen; Pennsylvania's gambling industry hasn't been operating long enough for a pattern to emerge, said Michael Pollock, managing director of Spectrum Gaming Group, an Atlantic City-based consulting agency.

"Gambling is a function of two things: One is disposable income. The other is time," Pollock said. "People have more time in the summer months."

At The Meadows in Washington County, wagers were down $60.9 million and gross revenue after slot machine payouts was down nearly $4 million in December, as compared to July. Even after the drop, gamblers wagered more than $188 million, and the casino took in more than $16 million before taxes in December.

The Meadows spokesman David La Torre said the casino does not plan to cut back employees' hours, and rather is focused on hiring the 700 additional people it needs to run the permanent casino. The temporary casino, which opened in June 2007, employs about 500.

The Meadows plans to open its permanent casino, which will be more than four times the size of its temporary one, early next year.

At Presque Isle Downs & Casino, wagers were about $34 million lower, and gross slots revenue was down $3.5 million in December, as compared to July. The Erie casino responded by cutting employee hours. Full-time workers now put in four days a week, and part-time workers lost eight hours from their 25-hour weeks, according to The Associated Press.

"You're talking about Erie in the winter," said Doug Harbach, spokesman for the Gaming Control Board. "A lot of places certainly get cold. ... It's going to hamper the amount of patrons that visit there. I think that's in their business plans."

A slowing economy and fears of recession also could be dragging casino profits down, but that is likely to have a larger effect on resort locations like Atlantic City, Pollock said.

"It will be minimal, at best, in Pennsylvania," Pollock said. "When you're dealing with an industry so relatively new, it's difficult to say what's typical (for a winter slowdown). This doesn't look like any cause for concern. You need multiple years to gauge anything."

 

 

Mike Wereschagin can be reached at [email protected] or 412-320-7900.
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