Arkansas gaming revenues increase; part of national trend

Electronic gambling revenues are up in Hot Springs and West Memphis and will likely continue to grow according to a new survey suggesting that U.S. gaming revenues will rise 3.6% between 2009 and 2014.

West Memphis-based Southland Park Gaming and Racing in November posted electronic games of skill (EGS) wagers of $64.238 million up nearly 53% from one year ago and higher than October’s record month of $63.9 million. Payouts in November totaled $61.101 million at Southland, according to this report from Talk Business.

Electronic games of skill include automated versions of blackjack, video poker, and craps.

Oaklawn Racing and Gaming didn’t have its best month in EGS wagers, but its results were still solidly profitable. The Hot Springs-based racetrack and casino recorded monthly EGS wagers of $37,054,509 with payouts to patrons totaling $34,851,631.  One year ago, Oaklawn’s November EGS wagers were $24,323,020, 52% below 2010 figures.

Year-to-date, Southland has seen total EGS wagers of $606.824 million, while Oaklawn EGS wagers have equalled $413.095 million. Combined, the two tracks have recorded $1.019 billion in the first 11 months of 2010.

PwC US, a tax advisory company, noted Dec. 7 in its “Playing to win” report that total U.S. gaming revenues will increase to $68.3 billion in 2014 from $57.2 billion in 2009, a 3.6% compound annual increase. The U.S. will remain the largest region in 2014, although Asia Pacific will be the fastest growing region with a projected 23.6% increase compounded annually to $62.9 billion in 2014 from $21.8 billion in 2009.

"The gaming industry is facing an evolution, which presents both challenges and opportunities for the industry’s established players and those considering to enter the market," Mary Lynn Palenik, director, gaming, entertainment, media & communications practice, PwC US, said in a statement. "The explosion of entertainment choices for consumers will make it vital for the industry to produce an offering and experience that consumers want to spend money on."

The report advised that regional casinos and racetrack casinos — like those in Hot Springs and West Memphis — will be the fastest growing category during the next five years.

“Regional casinos are gaining market share from Atlantic City and, to a lesser degree, from tribal casinos. For the forecast period as a whole, revenues will rise to $22.2 billion in 2014 from $16.6 billion in 2009, a 6.1% compound annual increase,” according to the report.

However, tribal casinos are not likely to return to the high growth rates enjoyed in the earlier part of the decade. The slow economy and increased competition are cited as reasons for the lower revenue growth at tribal casinos.

“A return to double digit increases that characterized the first half of the decade is not expected. Rather, revenues at tribal casinos will increase from $26.5 billion in 2009 to $30.3 billion in 2014, a 2.7 percent compound annual increase,” PwC noted.