US Casinos Shutting Down
The coronavirus pandemic has led to numerous casino closures across the United States. In Indiana, Illinois, and Massachusetts, gambling operations will shut down for at least two weeks. Even the gambling mecca of Las Vegas is closing its doors. The pandemic has also put a halt to all sporting events. What will the future hold?
Global impact on land-based casinos
The spread of the Covid-19 virus has brought the land-based gambling industry to a screeching halt in the USA. Numerous casinos have closed, some voluntarily and others through government orders. This is especially the case in Indiana, Illinois, and Massachusetts, where local authorities have shut down all establishments for at least two weeks. These decisions are based on guidelines from the CDC (Center for Disease Control), a federal agency of the U.S. Department of Health and Human Services. On Sunday (March 15), the agency suggested that all gatherings of 50 people or more in the U.S. be suspended for at least eight weeks. So far, over 3,600 Americans have been infected with the virus. Experts predict that more than 90 million Americans could be infected.
The ability for players to turn to iGaming services in lieu of physical casinos is uncertain. While Indiana offers online sports betting, it does not have any legal online casinos. In Illinois, only the state lottery can be played online. Online gambling has not been regulated in Massachusetts. The financial losses for the land-based sector are difficult to predict at this time.
Ohio casinos affected
The pandemic is also affecting the state of Ohio. Governor Mike DeWine and Health Department Director Amy Acton have issued an order prohibiting gatherings of more than 100 people. This includes gambling halls and casinos. One of these affected businesses is US gaming giant Penn National Gaming, which operates several Hollywood casinos and racetracks in Ohio.
Penn National Gaming President and CEO Jay Snowden explained that the closures were necessary. However, the casinos had taken various measures to prevent the spread of the virus. "The health and well-being of our guests and team members is always our top priority," he told Wallstreet-Online. Snowden added:
"We have not had any cases of Covid-19 since the outbreak began. We have implemented measures in line with CDC recommendations, including increased daily cleaning in our facilities, maximizing air circulation, canceling or postponing all concerts and live events, and we are temporarily closing our buffets."
The closure affects over 2,000 employees at Penn National Gaming. Snowden said the company will continue to pay wages to employees through the end of March. "This is a difficult time for all of us, and we are grateful for the support and understanding of all our guests and team members," he said. "We plan to carry out further cleaning measures in the meantime."
Larger companies respond
Despite not having issued a ban on mass gatherings, MGM Resorts, among others, announced it would shut down its Las Vegas properties. In February, the gambling giant also decided not to issue a profit forecast for 2020. One reason for this was the economic collapse in Macau, where the coronavirus shut down all casinos. MGM is not accepting new reservations for hotel bookings until the beginning of May. CEO Jim Murren explained the reasons and potential long-term effects to CNN. He said:
"Our top priority is the safety of our guests and staff. Collective action is needed to contain the health crisis and continue to provide high-quality gaming. We will find a way to create a safe environment for our guests and staff. This is an uncertain time in our country and around the world, and we must all do our part to contain the spread of this virus. We'll plan to reopen our resorts as soon as it's safe to do so."
Wynn Resorts has also closed its Las Vegas establishments. The company also closed the XS Nightclub and the Encore Beach Club. For all other facilities in the USA, the company plans to use "non-invasive" thermal cameras to monitor guests' temperatures. However, it is unclear if the casinos will be allowed to stay open at all.
Inevitable economic impact
The crisis is expected to have a significant impact on the financial performance of the U.S. casino industry. Caesars Entertainment, for example, could face particularly harsh effects. The company already posted a $1.2 billion loss, separate from the pandemic.
The situation in Las Vegas, considered a gambling stronghold, has also taken a turn due to the pandemic. The first case of the virus was reported in the city last week, adding to the uncertainty. To date, Nevada has recorded a total of 20 cases.
Globally, betting providers are struggling due to the coronavirus, as the pandemic resulted in the cancellation of all sports events. In the US, major professional sports leagues as well as European soccer leagues have all been suspended. Recently, even Formula 1 was called off because of COVID-19.
The effects can be clearly seen in the British bookmaker Paddy Power Betfair. The parent company, Flutter Entertainment, had warned that the cancellation of sporting events could result in a decrease in earnings before interest, taxes, depreciation and amortization (EBITDA) worth approximately 121.3 million euros. A whopping 78% of their total revenue in 2019 came from sports betting.
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Source: www.onlinecasinosdeutschland.com
