Pennsylvania’s casino revenue growth trend continued in May, as the industry posted its ninth consecutive month of year-over-year growth. However, the torrid rate of growth the industry has posted throughout the first four months of 2016 slowed a bit in May, with gross gaming revenue up less than 1 percent compared to May 2015. The state is still on pace to easily surpass its best year-to-date in total casino revenue. Once again, it was table games that bolstered the revenue numbers. Table game revenue was up nearly seven percent in May, offsetting a one percent decrease in slot revenue. Of note, it was a tumultuous month, as several casinos posted huge gains in table game revenue, while several others posted huge losses. Things were a bit more stable on the slot side, however, three casinos (Harrah’s, Valley Forge, Lady Luck) did see slot revenue decreases between six percent and eight and a half percent. A look inside the YTD revenue numbers Here is a look at the year-to-date tally for Pennsylvania’s casinos:
January 2016 GGR: $255,905,078 (+3.6%)
February 2016 GGR: $268,354,231 (+8.6%)
March 2016 GGR: $289,167,505 (+4.2%)
April 2016 GGR: $281,206,497 (+3.9%)
May 2016 GGR: $280,194,999 (+.80%) Historical look at casino revenue in Pennsylvania
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012 Who’s up in PA SugarHouse Casino
March 2016 revenue: $25,244,569 (2015: $23,358,038)
YoY change +8.08% SugarHouse Casino recently finished an expansion project that continues to pay dividends. In May, SugarHouse saw its current growth trend continue, this time by over 8 percent. SugarHouse also eclipsed the $25 million mark in May, and continues to look like a real contender to chase down some of the market leaders now that it has all the pieces in place to be a top-flight destination casino. SugarHouse’s rise has also thrust it ahead of nearby Harrah’s Philadelphia (actually located in Chester) for the local market lead. Sands Bethlehem
March 2016 revenue: $47,481,906 (2015: $44,826,256)
YoY change +5.92% After ceding the top spot to Parx for seven consecutive months, Sands Bethlehem reclaimed the title of Pennsylvania’s top revenue-generating casino in May, edging out Park by about $400,000. Considering the previous trend line (Parx was putting more and more distance between itself and Sands), It will be interesting to see if I oversold Parx’s rise. It could be an outlier month in the Sands/Parx rivalry. Parx Casino
March 2016 revenue: $47,081,032 (2015: $44, 862,541)
YoY change +4.95% Parx may have lost ground to Sands, but the casino still posted solid year-over-year gains, up nearly 5 percent thanks to increases in both slot revenue and table-game revenue. Valley Forge Casino Resort
March 2016 revenue: $10,920,807 (2015: $10,418,014)
YoY change +4.83% Valley Forge continued its consistent and methodical increase in gross gaming revenue in May, as the small casino nearly hit the $11 million mark in monthly revenue. The increase was on the back of a 32 percent increase in table game revenue. The Meadows Casino
March 2016 revenue: $22,370,206 (2015: $22,072,462)
YoY change +1.35% Following a terrific March and April, Meadows‘ growth slowed a bit in May, as the casino posted a trivial year-over-year increase in monthly revenue. That being said, Meadows’ table games were up over 18 percent in May. Who’s down in PA Presque Isle Downs and Casino
March 2016 revenue: $11,522,203 (2015: $11,640,688)
YoY change -1.02% Presque Isle seems destined to linger in the $10 million to $12 million range. The small racino is on the verge of being overtaken by Valley Forge in the near future. Hollywood Casino at Penn National
March 2016 revenue: $21,700,994 (2015: $22,041,202)
YoY change -1.54% Another ho-hum month for Hollywood Casino has allowed some of its competitors to put even more distance between themselves and the historic racetrack. Hollywood Casino now sits in the bottom half of the state’s 12 casinos in terms of overall monthly revenue. Harrah’s Philadelphia
March 2016 revenue: $24,038,376 (2015: $24,873,170)
YoY change -3.36% As alluded to above, SugarHouse’s gains seem to be having a direct impact on nearby Harrah’s. Revenue was down again at the Caesars Entertainment property. If things don’t turn around soon, Harrah’s could be the clear second fiddle in the Philadelphia area casino market. If this trend continues, Harrah’s could also find itself at the bottom of the trail pack in the near future. Mount Airy Casino Resort
March 2016 revenue: $16,342,852 (2015: $17,007,334)
YoY change -3.91% Mount Airy took a hit in May, as revenue dropped nearly 4 percent year-over-year. Down the road, the casino could very well jump into the second tier of casinos in Pennsylvania, provided the legislature passes a proposed gaming reform bill. That legislation would allow Category 3 casinos (like Mount Airy) to pay a one-time fee to eliminate their membership fee requirement, and to expand the number of slot machines and table games permitted on the property. Rivers Casino
March 2016 revenue: $27,854,334 (2015: $29,422,394)
YoY change -5.33% Rivers had a bad May, with revenue down over 5 percent year-over-year, largely because of a near 8 percent drop in slot revenue. Lady Luck Casino Nemacolin
March 2016 revenue: $2,893,548 (21015: $3,057,822)
YoY change -5.37% The also-ran of the Pennsylvania casino industry, the Lady Luck Casino, was also one of the biggest year-over-year losers in the market last month. The drop-off saw the casino’s monthly revenue total dip back below the $3 million mark. Mohegan Sun at Pocono Downs
March 2016 revenue: $22,744,173 (2015: $24,388,010)
YoY change -6.74% After 4 percent growth in April, Mohegan Sun came crashing back down in May, as revenue dropped almost 7 percent. Interestingly, Mohegan’s drop can be attributed to a loss in table-game revenue, not slots, a rare occurrence for such a large casino. Mohegan’s table-game revenue was down a staggering 28 percent in May, the most of any casino.

Contents
1 The bad news for PA slot revenue
2 The recent past for PA slots
3 Some casinos hurt worse than others
4 More regional competition for PA casinos
5 PA online gambling an answer? The bad numbers for Pennsylvania slot machine revenue are officially a trend. The bad news for PA slot revenue Gross slot machine revenue for Pennsylvania’s 12 casinos down 2.4 percent in January of 2017 as compared to the same month in 2016. Revenue checked in at $180.3 million, a decrease from $184.8 million. Tax revenue collected in January was $95.8 million. That’s the fourth straight month in which revenue declined year over year, and the fifth out of the past six months. The recent past for PA slots Most months have brought bad news from PA’s casinos for slot machine revenue:
August: Down $9 million.
September: Up $5 million.
October: Down $6 million.
November: Down $8 million.
December: Down $12 million. That constitutes a trend that it’s not clear that Pennsylvania will break out of. Some casinos hurt worse than others While some individual casinos have been able to buck the trend and post flat or positive numbers, seven casinos saw their revenue dip in January. The biggest impact last month — and in most recent months — hit Harrah’s Philadelphia. Harrah’s saw slot revenue drop more than 10 percent, or just under two percent. Other casinos that saw noticeable drops included Mohegan Sun Pocono, The Meadows Casino and Mount Airy. Valley Forge and Lady Luck Nemacolin experienced increases of about seven percent. More regional competition for PA casinos The climate for PA casinos, especially those near the New York and Maryland borders, isn’t going to get any better in the short term.
MGM National Harbor opened near Washington, DC
Two of New York’s four commercial resort casinos are now open, with two more on the way. It all adds up to more regional competition that is likely to hurt the bottom line of the PA casino industry as a whole. PA online gambling an answer? The possibility of the state legalizing online gambling remains a viable option to help PA casinos moving forward. With slot machines apparently in continual decline, PA online casinos and poker rooms could help stem the tide. Online gambling helps the bottom line of casinos in terms of real revenue. It can also help casinos activate new patrons or connect with current and/or lapsed casino visitors.

A nine-month streak of year-over-year growth came to an end in June by the smallest of margins, when Pennsylvania’s casino posted a .2 percent drop in gross gaming revenue. But the downward streak has already come to an end. Following the microscopic downtick in June, the state’s 12 casinos turned things around in a big way during the month of July, with the industry as a whole up nearly three percent YoY. The latest revenue report issued by the Pennsylvania Gaming Control Board shows total casino revenue of $288,451,402 in July. Table game revenue was up 8.5 percent YoY, and slot revenue also ticked up, but by the more modest amount of 1.1 percent.
July 2016 slot machine revenue: $213,423,773.92 (+1.14%)
July 2016 table game revenue: $75,027,628 (+8.47%) A look inside the YTD revenue numbers Here is a look at the monthly year-to-date revenue tally for Pennsylvania’s casinos:
January 2016 GGR -$255,905,078 (+3.6%)
February 2016 GGR – $268,354,231 (+8.6%)
March 2016 GGR – $289,167,505 (+4.2%)
April 2016 GGR – $281,206,497 (+3.9%)
May 2016 GGR – $280,194,999 (+.80%)
June 2016 GGR – $258,423,105 (-0.2%)
July 2016 GGR – $288,451,402 (+2.95%) Historical look at casino revenue in Pennsylvania Pennsylvania is currently on pace to have its best year to date. The previous high-water mark was set last year when the state’s casinos tallied $3.17 billion.
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012 A casino by casino look at the numbers Sands Bethlehem
Slot revenue, June 2016: $27,727,848.10 (+1.83%)
Table game revenue, June 2016: $21,148,923 (+11.99%) After ceding control of No. 1 to Parx for a stretch of nine months, Sands Bethlehem regained the top revenue spot in May, and has maintained its lead in both June and July. Sands saw total casino revenue rise nearly six percent in July, with table game revenue up almost 12 percent (Sands is already far and away the top casino for table games in Pennsylvania), and slot revenue up close to two percent. Parx Casino
Slot revenue, June 2016: $33,663,936.46 (+.70%)
Table game revenue, June 2016: $14,015,295 (+12%) Sands may be winning the battle for the top spot, but Parx is nipping right on its heels. Revenue at Parx was up 3.78 percent in July, with a 12-percent jump in table game revenue responsible for the bulk of the increase. SugarHouse Casino
Slot revenue, June 2016: $15,787,296.23 (+4.48%)
Table game revenue, June 2016: $9,276,205 (+33.56%) SugarHouse Casino had a terrific July. The casino saw revenues increase nearly 14 percent year-over-year, and broke through the $25 million ceiling for the first time. As impressive as those numbers were, it was the 33 percent jump in table game revenue that really catches the eye, and it looks like SugarHouse is poised to become a table-game juggernaut. A massive renovation project seems to be paying off in big ways for the Philadelphia casino, and if slot revenue continues to rise (SugarHouse has one of the lowest slot handles in the state) it could jump out of the trail pack and compete with Parx and Sands. Rivers Casino
Slot revenue, June 2016: $23,930,891.68 (-1.69%)
Table game revenue, June 2016: $5,470,591 (-4.08%) Rivers Casino in Pittsburgh is the third-highest grossing casino in the state despite a small YoY decline in total casino revenue. Slot revenue fell for the second straight month, but July’s drop-off was nowhere near the over eight percent decline the casino suffered through in June. Harrah’s Philadelphia
Slot revenue, June 2016: $18,098,428.66 (-2.3%)
Table game revenue, June 2016: $6,030,739 (+9.99%) After slipping down the revenue charts for several months, Harrah’s finally turned in a positive month in July. While it’s nothing to write home about (the casino only posted a .5 percent increase in revenue) the stabilization is a good sign for Harrah’s, considering the casino has been on a downhill trajectory ever since SugarHouse began to rise. Mohegan Sun at Pocono Downs
Slot revenue, June 2016: $19,418,825.76 (+2.13%)
Table game revenue, June 2016: $4,575,540 (-1.01%) A slight uptick in gross gaming revenue has Mohegan Sun right in the middle of the trail pack that is in constant pursuit of Parx and Sands. Mount Airy Casino Resort
Slot revenue, June 2016: $13,919,806.87 (+2.93%)
Table game revenue, June 2016: $3,518,373 (-17.04%) Table game revenue at Mount Airy has been plummeting over the past two months (down 17 percent in June and now 12 percent in July), which is certainly something to keep an eye on going forward. This seems to be a problem afflicting multiple Pennsylvania casino properties. Valley Forge Casino Resort
Slot revenue, June 2016: $6,610,723.61 (-3.42%)
Table game revenue, June 2016: $3,778,516 (+19.8%) Valley Forge put together a solid July. The small “resort” casino (which means something entirely different in Pennsylvania than it does anywhere else in the country) ticked back above the $10 million mark last month thanks to YoY growth of nearly four percent. The Meadows Casino
Slot revenue, June 2016: $20,466,041.65 (+3.02%)
Table game revenue, June 2016: $2,696,061 (-15.29%) Meadows held relatively steady in July, posting a modest YoY revenue increase of .5 percent. Interestingly, Meadows is suffering from the same malady as Mount Airy, as table-game revenue was down 13.5 percent in June and 15 percent in July. Presque Isle Downs and Casino
Slot revenue, June 2016: $11,481,979.62 (+2.76%)
Table game revenue, June 2016: $1,242,125 (+24.18%) July was a very nice month for Presque Isle thanks to a nearly 25 percent surge in table-game revenue. Coupled with a nearly three-percent increase in slot revenue, Presque Isle’s total casino revenue jumped over 4.5 percent. Hollywood Casino at Penn National
Slot revenue, June 2016: $19,204,924.61 (+1.42%)
Table game revenue, June 2016: $2,885,881 (-5.19%) Hollywood Casino posted a modest YoY increase of .5 percent. The casino continues to rely almost exclusively on slot revenue. Lady Luck Casino Nemacolin
Slot revenue, June 2016: $3,113,070.67 (+3.26%)
Table game revenue, June 2016: $389,379 (-1.23%) Revenue at Lady Luck ticked up in July, as the casino’s $3.1 million in total casino revenue represents a nearly three-percent jump over July of 2015.

Casinos in the Pennsylvania will be paying more tax for its winnings on tables games from now on. The change for table games As part of a revenue package approved by the legislature and signed by Gov. Tom Wolf earlier this month, the tax rate will increase on table-game revenue for Pennsylvania’s casinos. The rate will go from 14 percent to 16 percent; that increase is expected to generate an additional $17 million for the commonwealth. That’s a relatively small amount in a budget that totals more than $30 billion. But lawmakers were creating a patchwork of revenue-generating measures that would make up the $1 billion shortfall between a spending package and revenue currently used to fund the government. The table games tax rate was not a part of an earlier gambling expansion package passed by the House. Impact on online gambling? Meanwhile, the chances of legal Pennsylvania online casinos and poker rooms is looking good. As part of budget negotiations, $100 million is being counted on from gambling expansions in the state. The bulk of that is expected to come from licensing fees and taxation of online gambling, from a bill that has not yet been passed. The scope and language of the gambling expansion is not yet finalized, but it’s expected to come up this fall, as soon as September. According to Online Poker Report, the $17 million increase in taxes on table games should not affect whether online gambling is considered this fall. Who gets hurt by the table games tax? Every casino is going to feel the pinch, to some extent. They will all be paying more to the state coffers, unless they have a particularly poor or bad run for the fiscal year in paying out casino guests. According to the Morning Call, it will cost Sands Bethlehem more than $4 million, meaning it will get hit the worst of any PA casino. That’s borne out in the PA gaming revenue numbers for the fiscal year that were just released. Sands generated $228 million on table games for FY 2015-16, more than $70 million more than second-place Parx. Sands wasn’t terribly pleased with the increased tax, according to the Morning Call: Like Juliano implies, the tax rate is not a killer for casinos, it just eats into its profits. But, it’s the new reality that PA gaming facilities must deal with.

In 2014, economic analysts Econsult Solutions presented a thorough forecast of online gaming’s potential impact in Pennsylvania. A year later, Online Poker Report’s Robert DellaFave offered an update to the predictions made by Econsult, adjusted to reflect the state’s current regulatory climate. Updated PA online gambling revenue estimates In its report, Econsult predicted the state would see $187 million in first-year online gaming revenue, with up to $307 million annually once the market reached maturity. Over a five year period, DellaFave’s analysis produced a best-case estimate of $210.7 million in online gaming revenue for the state, a worst-case figure of $149.2 million, and a base estimate of $175.6 million. But despite rigorous attention to detail from both DellaFave and Econsult, several variables remain for Pennsylvania which could potentially render obsolete even the most meticulously outlined predictions. Question marks remain Tax rates, a longstanding point of contention for online gaming in Pennsylvania, will continue to serve as a sticking point in negotiations, and could impact the overall performance of online gaming. Casinos, of course, would favor lower tax rates, and generally appear to support the rate of 15 percent proposed in Representative John Payne’s HB 649. This bill is the basis upon which DellaFave’s analysis was calibrated. While HB 649 appears to be a frontrunner among both lawmakers and casino brass, support is not unanimous. Payne’s online gaming bill is one of five currently circulating in Harrisburg, and other lawmakers have balked at the proposed 15 percent rate. Senator Sean Wiley, who plans to introduce online gaming legislation of his own, will seek to tax virtual casinos at a rate of 36 percent. SB 900, introduced last week and sponsored by Senator Kim Ward, would tax online casinos at a rate of 54 percent. Ward has said, however, that SB 900’s original language was merely a jumping-off point, portions of which have already been amended. Much of the bill remains subject to change, potentially including the proposed tax figure. At a committee hearing in Harrisburg last week, Senator Robert Tomlinson voiced concerns about taxing online casinos at a lower rate than their brick and mortar counterparts, calling it a “scary point.” If higher profit margins were to be found online, Tomlinson said, casinos in the state would be pushed to divest from live establishments. Difficult to compare PA and NJ Revenue figures from New Jersey, which has offered regulated online gaming for about a year and half, would seem to be an obvious comparison. But while New Jersey’s online gaming data are the best real-world tool available for Pennsylvania forecasters, one-to-one comparisons between the states are largely unreliable. Precluding this comparison, in part, are a number of key demographic differences. Pennsylvania’s unemployment rate, at 5.3 percent, is solidly below New Jersey’s 6.5 percent rate, and even below the national average of 5.5 percent. However, per capita income in New Jersey, the second-highest in the nation as of 2013, is significantly above that of Pennsylvania. Further frustrating possible comparisons between the states is an age disparity. Online gaming appeals more strongly to younger audiences, but median age in Pennsylvania is higher than that of New Jersey, which could translate to comparatively lower revenues for the former. For Pennsylvania casinos hoping to maximize value in the digital market, the spectre of ubiquitous online gaming opponent Sheldon Adelson looms. Notably absent from the New Jersey casino industry, Adelson and his Sands Bethlehem are poised to contest regulation in Pennsylvania however possible. While even Adelson may not be able to stop legalization entirely, Sands’ lobbying efforts could still delay the process, and possibly even influence language contained in future bills.

A fresh round of online gaming op-eds appeared last week on the pages of PennLive, the homepage of Harrisburg’s Pennsylvania Patriot-News. The two articles, respectively written by public relations executives Tony May and Charlie Gerow, argued starkly opposing viewpoints. May, a lobbyist for Harrisburg’s Triad Strategies, did not explicitly call for online gaming legislation to fail, but spoke critically of regulation. Gerow, of the Harrisburg-based public relations firm Quantum Communications, offered bullish optimism. Gerow’s Argument Possible alternative to higher taxes The issue of online poker comes at a crucial moment for Pennsylvania Governor Tom Wolf, who recently proposed a series of tax hikes despite promising lower taxes during his 2014 campaign. Experts have estimated that Pennsylvania will face a $1.2 billion budget deficit next year, and supporters of online gaming, such as Gerow, view the revenue stream as a means by which Wolf can bridge the gap without raising taxes. Gerow touted the $10.3 billion in Pennsylvania revenue since 2006, when casinos first began operating in the state. Land-based Pennsylvania casinos, all of whom principally support online gaming (with the exception of Sands Bethlehem), have also adopted that figure as a rhetorical centerpiece, and a number of executives mentioned it specifically at a State Senate committee hearing last week. Social ills exaggerated Fears of online gaming’s potentially dangerous social consequences were overemphasized, Gerow added. “The concerns about increased social pathologies are relatively easy to deal with, given the record of previously expanded gaming,” he wrote. “Most Pennsylvanians would prefer he find his spending money someplace other than their pockets,” Gerow’s column concluded. Gerow noted that he and May were once united in support for the expansion of Pennsylvania online gaming legislation, but the pair, who co-host a local public access television program, now appear to disagree on the issue. May’s Argument Lawmakers acting irrationally In his counterpoint, May invoked the gambler’s fallacy, personifying Pennsylvania lawmakers as a losing casino patron. May accused Pennsylvania lawmakers of succumbing to an irrational belief that its luck would differ from New Jersey, a neighboring state currently suffering from poor casino receipts. “Casinos are failing in Atlantic City,” he wrote. “New casinos are popping up in neighboring states and revenues at healthy casino operations are flattening out if not declining.” Shortsightedness of public support But given its voluntary nature, May said, gambling is typically viewed favorably by the voting public. Where citizens would otherwise oppose coercive or costly legislation, gaming offers consenting adults an opportunity, not a mandate, to spend. “Gaming expansions are de facto taxes on self-selected segments of the population,” he wrote, adding “the psychology of gaming is irrefutable.” May cited theories that a conspicuous consumption bubble would soon burst, causing widespread harm to the entertainment and hospitality industries. Oversaturation of the modern gaming landscape, he said, is evidence that such a tipping point approaches. “Daily numbers, instant games, mega multi-state jackpots, slots, table games, Keno, pari-mutuel betting and maybe widespread, legalized sports betting,” May wrote. “How big can it get?” The op-ed columns are the latest on the topic for PennLive, which last month published another pair of high-profile arguments both for and against online gaming. Blanche Lincoln, a Sheldon Adelson-backed lobbyist, said it would be a “fiscal loser” for the state, while Senators John Payne and Nick Kotick, sponsors of the online poker bill SB 900, argued in support of such legislation.

On the heels of a disappointing August, the Pennsylvania casino industry bounced back — to borrow a word from Donald Trump — bigly in September, with total casino revenue up nearly three percent year-over-year, and both slot handle and table game revenue posting YoY gains. The September rebound makes August’s decline look even more like an outlier, as total gross gaming revenue (GGR) has been up in seven of the nine months. The only other month where the industry posted a YoY decline was June, when total GGR was down just 0.2 percent. The September numbers September saw most casino post year-over-year gains, and of the four casinos that posted losses, three of the four were under two percent. The worst YoY loss was just -2.68 percent, posted by Rivers Casino. Two casino posted solid gains in September:
SugarHouse Casino: +12 percent
Parx Casino: +10 percent Here’s a look at the industry-wide breakdown of slot revenue and table game revenue in September:
September 2016 slot machine revenue: $192,150,329.51 (+2.43%)
September 2016 table game revenue: $68,787,147 (+4.35%) A look inside the YTD revenue numbers Here is a look at the monthly year-to-date revenue tally for Pennsylvania’s casinos:
January 2016 GGR -$255,905,078 (+3.6%)
February 2016 GGR – $268,354,231 (+8.6%)
March 2016 GGR – $289,167,505 (+4.2%)
April 2016 GGR – $281,206,497 (+3.9%)
May 2016 GGR – $280,194,999 (+.80%)
June 2016 GGR – $258,423,105 (-0.2%)
July 2016 GGR – $288,451,402 (+2.95%)
August 2016 GGR – $260,904,471 (-4.28%)
September 2016 GGR – $260,937,476 (+2.93%) Historical look at casino revenue in Pennsylvania Pennsylvania is on pace to blow past its previous high water mark, set last year when the state’s casinos tallied $3.17 billion.
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012 A casino-by-casino look at the numbers Sands Bethlehem
Slot revenue, September 2016: $24,761,852.36 (-.55%)
Table game revenue, September 2016: $19,403,808 (+3.46%) After reclaiming the top spot from Parx Casino during the summer, Sands Bethlehem slot revenue dipped for the second consecutive month, allowing Parx to jump ahead of Sands as the highest revenue generator in the Pennsylvania casino industry for the second consecutive month. Sands is believed to be considering a $40 million table games expansion, but the project appears to be contingent on certain legislative actions not occurring. That would include a gaming reform bill that might see slot machines introduced at off-track-betting parlors in the state. Parx Casino
Slot revenue, September 2016: $31,812,334.95 (+6.05%)
Table game revenue, September 2016: $14,091,154 (+19.98%) September was a spectacular month for Parx Casino. With solid gains in slot (over 6 percent) and table game (nearly 20 percent) revenue, Parx maintained its lead over Sands Bethlehem. SugarHouse Casino
Slot revenue, September 2016: $14,475,186.66 (+11.37%)
Table game revenue, September 2016: $8,762,325 (+21.94%) SugarHouse continues to make gains across the board, and based on its current rate of growth, and the size of the facility following its expansion project, SugarHouse is likely to find itself competing with Sands and Parx for No. 1 in the not too distant future. The casino is still a ways off at the moment, but SugarHouse’s growth is showing no signs of slowing down, and with the launch of a New Jersey online casino, they could start seeing an extra several hundred thousand dollars of revenue coming in each month. Rivers Casino
Slot revenue, September 2016: $20,878,476.49 (-.54%)
Table game revenue, September 2016: $5,300,662 (-10.28%) Despite declines in both slot and table game revenue in September — only one of two casinos that was down on both counts, Lady Luck was the other — Rivers Casino is still the third highest grossing casino in the state. But the Rush Street-owned Rivers continues to lose ground to another Rush Street property, SugarHouse. If the current trends continue, SugarHouse should overtake Rivers sometime in 2017. Harrah’s Philadelphia
Slot revenue, September 2016: $16,582,481.25 (+1.42%)
Table game revenue, September 2016: $4,330,848 (-11.12%) It was good news/bad news for Harrah’s in September, with slot revenue ticking up by about 1.5 percent, while table game revenue dropped by over 11 percent. Mohegan Sun at Pocono Downs
Slot revenue, September 2016: $17,901,962.72 (+1.01%)
Table game revenue, September 2016: $3,630,620 (+16.94%) Mohegan Sun posted solid gains in September, as slot and table games revenue both grew significantly, particularly table games. Mount Airy Casino Resort
Slot revenue, September 2016: $12,069,155.59 (+3.85%)
Table game revenue, September 2016: $3,859,988 (-2.12%) Mount Airy stopped the bleeding on the table game front, as revenue was down just two percent in September. You may be wondering how a decline in what was a good month industry-wide is good news, but compare September’s small dip to the massive declines over the course of the summer and you’ll see why Mount Airy would be happy with a small decline. During the past three months, table game revenue was down 17 percent in June, 12 percent in July and 29 percent in August. Even more promising, Mount Airy’s slot revenue jumped by nearly four percent YoY. Valley Forge Casino Resort
Slot revenue, September 2016: $6,579,073.10 (+10.81%)
Table game revenue, September 2016: $2,428,132 (-20.34%) It was a tale of two months for Valley Forge as slot revenue was up by over 10 percent, and table game revenue was down by nearly twice that much. The Meadows Casino
Slot revenue, September 2016: $18,001,682.59 (+2.61%)
Table game revenue, September 2016: $2,036,221 (-16.27%) September was a pretty stable month for Meadows, as the casino’s slot revenue gains offset a significant drop-off on the table game side of the business. Presque Isle Downs and Casino
Slot revenue, September 2016: $9,874,109.80 (+.16%)
Table game revenue, September 2016: $1,648,283 (+53.69%) Presque Isle saw its slot revenue hold steady, but the casino managed to post a significant year-over-year increase thanks to table game revenue surging over 50 percent. Hollywood Casino at Penn National
Slot revenue, September 2016: $16,712,849.50 (-3.20%)
Table game revenue, September 2016: $2,977,838 (+6.07%) The Hollywood Casino trend of volatility continued in September, as slot revenue dropped off substantially, while table game revenue ticked up slightly. The Penn National property has been up and down all year, with little rhyme or reason to the ups and downs. Lady Luck Casino Nemacolin
Slot revenue, September 2016: $2,501,164.50 (-.42%)
Table game revenue, September 2016: $317,269 (-12.28%) The smallest casino in the state continues to struggle for market share. Lady Luck is also struggling with consistency, as the casino’s monthly revenue ebbs and flows seemingly at random.

Contents
1 The top line October numbers
2 The top line October numbers
3 A look inside the YTD revenue numbers
3.1 Historical look at casino revenue in Pennsylvania
4 A casino-by-casino look at the numbers
4.1 Sands Bethlehem
4.2 Parx Casino
4.3 SugarHouse Casino
4.4 Rivers Casino
4.5 Harrah’s Philadelphia
4.6 Mohegan Sun at Pocono Downs
4.7 Mount Airy Casino Resort
4.8 Valley Forge Casino Resort
4.9 The Meadows Casino
4.10 Presque Isle Downs and Casino
4.11 Hollywood Casino at Penn National
4.12 Lady Luck Casino Nemacolin For Pennsylvania casinos, October was a tale of two revenue streams. On the one hand, table game revenue jumped by five percent industry-wide. On the other hand, slot revenue at the state’s 12 casinos dropped by three percent. Taken together, total casino revenue was down less than one percent year-over-year for the month. October was only the third time Pennsylvania’s casino industry posted a YoY decline, and two of those months, October and June, saw revenue dip by less than one percent. September had been a month of solid growth. The top line October numbers For Pennsylvania casinos, October was a tale of two revenue streams. On the one hand, table game revenue jumped by five percent industry-wide. On the other hand, slot revenue at the state’s 12 casinos dropped by three percent. Taken together, total casino revenue was down less than one percent year-over-year for the month. October was only the third time Pennsylvania’s casino industry posted a YoY decline, and two of those months, October and June, saw revenue dip by less than one percent. The top line October numbers October revenue was relatively static at nine of the state’s casinos, ranging between -5.26 percent and +2.11 percent. The two Philadelphia area casinos, SugarHouse and Harrah’s, continued to move in opposite directions. SugarHouse’s total monthly revenue jumped almost 19 percent. Harrah’s experienced yet another month of double-digit revenue decline, as total revenue dropped by 11.5 percent year-over-year. Here were the three outliers in October:
SugarHouse Casino: +18.74 percent
Harrah’s: -11.52 percent
Lady Luck: -10.93 percent Here’s a look at the industry-wide breakdown of slot revenue and table game revenue in October:
October 2016 slot machine revenue: $191,850,596.41 (-3.04%)
October 2016 table game revenue: $71,161,384 (+5.35%) A look inside the YTD revenue numbers Here is a look at the monthly year-to-date revenue tally for Pennsylvania’s casinos:
January 2016 GGR -$255,905,078 (+3.6%)
February 2016 GGR – $268,354,231 (+8.6%)
March 2016 GGR – $289,167,505 (+4.2%)
April 2016 GGR – $281,206,497 (+3.9%)
May 2016 GGR – $280,194,999 (+.80%)
June 2016 GGR – $258,423,105 (-0.2%)
July 2016 GGR – $288,451,402 (+2.95%)
August 2016 GGR – $260,904,471 (-4.28%)
September 2016 GGR – $260,937,476 (+2.93%)
October 2016 GGR – $263,011,981 (-.91%) Historical look at casino revenue in Pennsylvania Pennsylvania is on pace to beat its previous high-water mark, set last year when the state’s casinos tallied $3.17 billion. Through 10 months, the state’s casinos have tallied $2,707,483,445. Historically, Pennsylvania can expect November and December to add $520 million or more to its tally.
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012 A casino-by-casino look at the numbers Sands Bethlehem
Slot revenue, October 2016: $25,057,866.26 (+2.17%)
Table game revenue, October 2016: $16,828,699 (-10.34%) After out-pipping Parx for two months, Sands Bethlehem has fallen behind Parx as the top revenue-producing casino for the third consecutive month in October. More troubling for Sands is the amount by which Parx was able to outpace it in October, some $2.5 million. A lot of ground was ceded on the table game side, as Sands saw a 10-percent YoY drop, while Parx managed to post a five-percent increase. With the North Jersey casino referendum failing, and with online gambling legislation on hold until 2017, Sands is likely to forge ahead with an expansion project designed to bolster its already best-in-the-industry table game offerings. Parx Casino
Slot revenue, October 2016: $31,807,584.58 (+.98%)
Table game revenue, October 2016: $12,772,722 (+5.04%) Thanks to gains in both slot and table game revenue, Parx is once again the clear top dog in the market. One of the few casinos to post slot and table game revenue gains, Parx is no doubt very pleased with its October numbers. SugarHouse Casino
Slot revenue, October 2016: $14,926,311.14 (+5.22%)
Table game revenue, October 2016: $10,657,745 (+44.82%) What SugarHouse has done throughout 2016 is downright remarkable. The Philadelphia casino went all-in on an massive expansion project (completed earlier this year) that has propelled it up the revenue charts. SugarHouse is on the verge of overtaking Rivers Casino (a sister property owned by SugarHouse’s parent company Rush Street Gaming) as the third highest grossing casino in Pennsylvania, and is also within striking distance of Parx when it comes to table game revenue. If SugarHouse goes through with a planned second expansion project (which would, among other things, add a hotel), it will likely find itself challenging Parx and Sands. Rivers Casino
Slot revenue, October 2016: $21,632,607.36 (-5.05%)
Table game revenue, October 2016: $6,312,487 (+11.17%) The gap between Rivers and SugarHouse is closing, but Rivers still has a veritable monopoly on the Pittsburgh area, which should allow Rivers to keep pace. October was a good news/bad news month for Rivers. Slot revenue was down five percent YoY as table game revenue jumped more than 11 percent. Harrah’s Philadelphia
Slot revenue, October 2016: $16,857,930.53 (-9.24%)
Table game revenue, October 2016: $5,434,645 (-17.91%) It’s hard to envision Harrah’s having a worse October. Not only did its regional rivals see revenue jumps, but Harrah’s revenue was down significantly across the board, as the casino posted a near 10-percent decline in slot revenue and a staggering 18-percent drop in table game revenue. Mohegan Sun at Pocono Downs
Slot revenue, October 2016: $17,018,525.36 (-6.39%)
Table game revenue, October 2016: $4,603,835 (+20.29%) Like several other Pennsylvania casinos, Mohegan Sun saw slot revenue drop and table game revenue rise in October. Mount Airy Casino Resort
Slot revenue, October 2016: $11,647,663.22 (+.76%)
Table game revenue, October 2016: $3,782,901 (-1.56%) Mount Airy had a very even October. Slot and table game revenue fluctuated very little year-over-year, and Mount Airy was one of only a handful of casinos that could boast positive slot revenue for the month. Valley Forge Casino Resort
Slot revenue, October 2016: $6,374,220.05 (-2.72%)
Table game revenue, October 2016: $3,386,312 (+12.14%) Valley Forge followed the industry’s October trend, with slot revenue down and table game revenue on the ascent. The Meadows Casino
Slot revenue, October 2016: $18,023,978.85 (-6.86%)
Table game revenue, October 2016: $3,028,774 (+39.59%) Sensing a pattern yet? Meadows also saw slot revenue dip and table game revenue rise, but in this case, the table game gains were quite substantial, as YoY revenue was up nearly 40 percent. Presque Isle Downs and Casino
Slot revenue, October 2016: $9,405,960.82 (-5.41%)
Table game revenue, October 2016: $2,886,859 (+8.68%) Presque Isle was yet another casino with declining slot revenue and rising table game revenue. Even with nearly nine-percent YoY growth on the table game side of the ledger, Presque Isle was down significantly in total casino revenue. Hollywood Casino at Penn National
Slot revenue, October 2016: $16,795,712.74 (-7.30%)
Table game revenue, October 2016: $1,051,801 (+6.30%) Hollywood Casino had a bad month of slot machine handle, with revenue down more than seven percent YoY. Modest gains on the table game side helped mitigate the slot revenue decline. Lady Luck Casino Nemacolin
Slot revenue, October 2016: $2,302,235.50 (-11.34%)
Table game revenue, October 2016: $414,603 (-8.59%) Lady Luck wasn’t able to keep pace with its competitors in the market, as both table game and slot revenue fell significantly in October.

Pennsylvania’s casinos generated more revenue during the 2015/2016 fiscal year than in any previous fiscal year, according to data recently released by the Pennsylvania Gaming Control Board. According to the PGCB, total revenue (slot machines and table games) was up 3.6 percent, as the state’s 12 casinos generated a total of $3,227,835,876 between July 1, 2015 and June 30, 2016. The breakdown for slot revenue and table game revenue during FY2015/2016 is as follows:
Total slot revenue: $2,388,658,549
Total table game revenue: $839,177,086 Table game revenue hit an all-time high in FY2015/2016. (Pennsylvania first legalized table games in 2010). On the other hand, slot revenue was up year-over-year, but fell short of the high-water mark set in FY2011/2012, when Pennsylvania’s casinos tallied $2,476,775,317 in slot revenue. The strong FY numbers took some of the attention away from the slightly disappointing June numbers the industry posted. For the first time since August of 2015, Pennsylvania’s casino industry saw year-over-year revenue dip, ending a nine-month streak of YoY growth. The good news is, it wasn’t a bad month by any stretch of the imagination. The industry experienced just a 0.2 percent decline in June of 2016 compared to June 2015, as table game revenue rose, while slot revenue dipped. For the month of June, the state’s casinos saw table game revenue rise 2.15 percent in June, while slot revenue was down 1.08 percent, year-over-year. A look inside the YTD revenue numbers Here is a look at the monthly year-to-date revenue tally for Pennsylvania’s casinos:
January 2016 GGR -$255,905,078 (+3.6%)
February 2016 GGR – $268,354,231 (+8.6%)
March 2016 GGR – $289,167,505 (+4.2%)
April 2016 GGR – $281,206,497 (+3.9%)
May 2016 GGR – $280,194,999 (+.80%)
June 2016 GGR – $258,423,105 (-0.2%) Historical look at casino revenue in Pennsylvania
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012 A casino by casino look at the numbers Sands Bethlehem
Slot revenue, June 2016: $24,063,352.40 (+0.74%)
Table game revenue, June 2016: $19,093,476 (+8.84%) After watching Parx dominate for seven straight months, Sands Bethlehem is once again flexing its muscle. For the second consecutive month, Sands is at the top of the revenue charts in Pennsylvania. Sands posted year-over-year increases in slot and table game revenue in June, allowing the casino to maintain a slight edge over its chief rival Parx. Parx Casino
Slot revenue, June 2016: $30,882,060.44 (+2.45%)
Table game revenue, June 2016: $12,222,406 (-2.34%) Parx’s slot revenue saw solid year-over-year growth on the strength of a solid increase in handle. But a slight decline in table-game revenue kept the casino from overtaking Sands as the top revenue-generating casino for the month. SugarHouse Casino
Slot revenue, June 2016: $14,925,512.77 (+8.61%)
Table game revenue, June 2016: $10,145,531 (+17.42%) Proving that their lengthy, and costly expansion project was worth it, the growth trend for SugarHouse continued in June, as the Philadelphia-based casino posted significant year-over-year gains in slot and table game revenue. Rivers Casino
Slot revenue, June 2016: $20,834,516.12 (-8.56%)
Table game revenue, June 2016: $5,384,393 (-2.53%) SugarHouse’s sister casino, Rivers Casino in Pittsburgh, followed up a bad showing in May with an even worse showing in June. Slot revenue was down a whopping 8.5 percent in June, overshadowing the 2.5 percent decline the casino’s table games suffered. Harrah’s Philadelphia
Slot revenue, June 2016: $16,480,445.85 (-5.32%)
Table game revenue, June 2016: $5,145,051 (-2.31%) With SugarHouse on the ascent, nearby Harrah’s continues to be one of the hardest hit casinos. Harrah’s revenue continued to slide in June, as its parent company is fighting through bankruptcy restructuring. It’s unlikely the casino will be able to invest in the marketing and promotional campaigns needed if it plans on turning around its fortunes in the coming months. Mohegan Sun at Pocono Downs
Slot revenue, June 2016: $17,583,006.14 (-0.39%)
Table game revenue, June 2016: $3,635,374 (-1.17%) In a down month for the industry, Mohegan Sun will probably be pretty happy with its relatively stagnant June numbers. Mohegan Sun managed to hold steady, as slot and table game revenue ticked down ever so slightly. Mount Airy Casino Resort
Slot revenue, June 2016: $11,670,701.54 (+1.34%)
Table game revenue, June 2016: $3,074,252 (-12.24%) The table game decline for Mount Airy was mitigated by a slight increase in slot revenue, resulting in just a small YoY decline in total casino revenue. Valley Forge Casino Resort
Slot revenue, June 2016: $6,063,468.05 (-4.40%)
Table game revenue, June 2016: $2,973,908 (-5.11%) Declining slot and table game revenue nearly caused Valley Forge to fall below the $10 million threshold in June; a threshold it has historically been on the wrong side of and only recently passed. The Meadows Casino
Slot revenue, June 2016: $17,891,657.66 (-1.52%)
Table game revenue, June 2016: $2,211,263 (-13.55%) Meadows Casino was one of many Pennsylvania casinos that saw both slot revenue and table game revenue decline in June. The others were Hollywood Casino, Valley Forge Casino, Mohegan Sun, Harrah’s Philadelphia, and Rivers Casino. Meadows, one of the top slot casinos in the state (the casino posted the fourth highest slot revenue total in the state in June), continues to lag behind its competitors when it comes to table games. Presque Isle Downs and Casino
Slot revenue, June 2016: $10,055,690.95 (-2.01%)
Table game revenue, June 2016: $1,374,560 (+18.21%) The 18 percent jump for Presque Isle in table-game revenue helped offset the casino’s two percent dip in slot revenue. Hollywood Casino at Penn National
Slot revenue, June 2016: $17,030,371.52 (-2.65%)
Table game revenue, June 2016: $2,620,670 (-13.24%) Another down month for Hollywood Casino saw total gaming revenue dip below the $20 million mark. By comparison, in June of 2015, Hollywood generated $20.5 million in total casino revenue. Lady Luck Casino Nemacolin
Slot revenue, June 2016: $2,495,907.00 (-6.23%)
Table game revenue, June 2016: $565,532 (22.45%) The state’s smallest casino had an up-and-down month, as slot revenue plummeted while table-game revenue soared. In the end, Lady Luck saw total casino revenue dip year-over-year.

Penn National Gaming, which operates the Hollywood Casino at Penn National Racecourse, came out in full support of online gaming expansion in Pennsylvania at a hearing in front of the House Gaming Oversight Committee on Wednesday. In addition to supporting iGaming expansion, Penn National’s Senior Vice President of Government Affairs, Eric Schippers, announced the company had created its own internal online gaming revenue estimates. Schippers said the company’s projections were based on other studies as well as lessons learned in New Jersey. According to Schippers, these estimates are largely driven by Chris Sheffield, Penn National’s new iGaming guru, whose official title is Head of Online Gaming. Sheffield was brought on board in January to help guide Penn National into the online space. Penn National’s estimates as relayed by Schippers were:
Year one: $250 million
Year two: $300 million
Year three and beyond: $350 million To many, Penn National is overestimating the potential of online gaming in Pennsylvania, but Schippers qualified the numbers by saying they are “aggressive” and do not include any “restrictor plates” that could be placed on the industry, such as having to sign up in-person at a brick and mortar casino. Even with these caveats, Penn National’s projections seem lofty. Econsult projections on PA online gambling In a 2013/2014 report created for the Pennsylvania legislature, Econsult Solutions was a bit more pessimistic with its online gaming revenue projections for the state. Econsult estimated year one online gaming revenue in Pennsylvania at $184 million, with revenue increasing to $307 million when the market fully matures. And it should be noted Econsult’s projections are considered high by other analysts. Using population as the sole metric (granted, not the best way to come up with revenue projections), Pennsylvania should generate roughly 30% more revenue than New Jersey. So even though Econsult’s $184 million projection seems timid (particularly when compared to Penn National’s), it’s still above the $160 million the state can expect to reap based on the industry’s experience in New Jersey. Are there reasons for optimism? There are several viable reasons Penn National’s projections are on the higher end, and as Schippers stressed at the hearing, these projections were made under the assumption that the industry launches and runs seamlessly. Two restrictor plates that will have to be removed for Pennsylvania to reach its full potential are:
Improved payment processing.
Learning the lessons from New Jersey and solving disconnects, inferior software, lack of customer awareness, and over-cautious geolocation constraints. Additionally, Penn National may also believe Pennsylvania’s larger population (about 30% over New Jersey) will create better liquidity for online poker sites and increase traffic exponentially. Two reasons for pessimism For Penn National’s projection of $250 million in year one to hold true, the state is going to have to significantly outperform New Jersey. This is a tall task considering New Jersey trumps Pennsylvania in two key economic metrics:
Disposable income per capita: NJ = $49,267; PA = $42,253 (even adjusted for cost of living NJ residents still have more disposable income)
Median household income: NJ = $67,458; PA = $50,228 Early New Jersey revenue projections were harmful While it may not seem like a big deal, as New Jersey discovered, aggressive revenue projections can have a negative impact on the industry. In fact, New Jersey’s impossible projections have been a major talking point for those seeking to ban online gambling, allowing them to call the industry a failure. Online gaming revenue totaled $123 million in New Jersey during its first full year. By itself this would be an acceptable tally. Unfortunately, the $123 million number looks paltry when it was held up to the early predictions:
Wells Fargo produced the most infamous projection in 2013 when it estimated the New Jersey market to be worth $650 to $850 million. This led to the New Jersey government estimating $1.2 billion, a number that was only off by a factor of 10.
In 2013 Morgan Stanley projected $541 million. Morgan Stanley later revised its estimates in May of 2014 to $203 million – which was still off by 75% – and down to $127 million in December of 2014.
A dated 2010 report by H2 Gambling Capital had the New Jersey market generating $410 million in revenue in year one.
In 2013 Gambling Data (a subsidiary of Gambling Compliance) estimated New Jersey’s year one revenue at $235 to $288 million.
Econsult’s projection for New Jersey was $266 million in 2013.
Eilers Research was the closest to the mark, with a projection of $226 million in 2013.
In two separate reports (one in 2013 and one in 2014) Fitch Ratings had New Jersey revenue between $200 to $300 million. Analysts have learned from these mistakes The good news is analysts have taken a number of lessons from New Jersey. With the closest projection off by over 100%, analysis of the Pennsylvania market has been far less adventurous and tempered. One example of this is Econsult’s projection for New Jersey (a state with a population of around 9 million) was $266 million, but roughly a year later its projection for Pennsylvania (a state with a population of nearly 13 million) was just $184 million. Final word Even though Penn National placed caveats on projections, its $250 million estimate will hopefully be the highest projection submitted. Based on New Jersey, Delaware, and Nevada, as well as ring-fenced markets in Europe, it’s unlikely Pennsylvania will approach $200 million in year one online gaming revenue, even if it’s smooth sailing from the get go.