A crashed riverboat casino epitomizes the gaming industry’s year in 2020 By Howard Stutz, Executive Editor, CDC Gaming Reports August 29, 2020 at 5:00 am Hurricane Laura roared across western Louisiana with the strength to knock the Isle of Capri Lake Charles casino off its moorings. The storm sent the three-level riverboat across the lake, crashing into pillars supporting the Interstate 10 overpass. The highway connects the gaming community with Houston, its largest customer base 134 miles to the west. As the boat sat, a chlorine gas fire raged in the distance. The scene alone symbolized the nation’s gaming industry in 2020. COVID-19 has walloped the casino business with a punch harder than a Mike Tyson uppercut. Gaming has yet to take a standing eight count, but there are still four months left in the year. For the most part, gaming has survived the shutdown of nearly 1,000 commercial and tribal casinos nationwide starting the end of March. More than 87% of the closed casinos have since reopened and are operating under state and tribal government guidelines for health, safety, cleaning, social distancing, and space limitation protocols. A handful of properties, however, didn’t outlast the virus and have closed permanently. Casino operators around the U.S. have adjusted their business offerings. Customers are coming back, but not in large droves. “A lot of the competing entertainment isn’t there. You can’t go to movie theaters. In some states, you can’t go to bars,” Full House Resorts CEO Dan Lee said on his company’s quarterly earnings conference call earlier this month. “I think people realize that we can take our casinos and socially distance the slot machines, and it’s a safe environment and we’re pretty careful about that,” Lee said of Full House’s five regional casinos in four states. Hurricane Laura caused the Isle of Capri riverboat casino to crash into the I-10 overpass in Lake Charles, Louisiana/The Advocate via AP Las Vegas is a different story. In the past two weeks, national media outlets – ProPublica and The Daily Beast – cited the city as a possible “super spreader” for COVID-19 with visitors either bringing the virus with them or taking it home when they leave. The stories brought negative attention to the industry. This past week was a mixed bag of news. Las Vegas Strip gaming revenues declined “only” 39.2% in July, a much lower drop than anticipated, but the investment community sounded a somewhat dispassionate tone. “We think headline July figures are fairly in line with expectations around a slow-to-recover Las Vegas Strip,” said Truist Securities gaming analyst Barry Jonas, adding, “we caution non-gaming revenues (roughly two-thirds of the Strip’s annual overall revenue figures) will likely remain even more challenged for the time being.” On Thursday, MGM Resorts International reopened the iconic The Mirage after more than five months on the sidelines. Less than 24 hours later, CNBC reported the company was permanently laying off 18,000 nationwide workers who had been furloughed since March. COVID-19’s financial impact on the gaming industry shows no signs of letting up. The American Gaming Association, in a report on commercial casino states in the second quarter, said gaming revenues declined nearly 79% in the three-month period. “COVID-19 has undoubtedly posed the most difficult economic challenge the gaming industry has ever faced,” said Bill Miller, CEO of the Washington D.C.-based trade organization. A craps table in Las Vegas sees some action when the Strip reopened on June 4/Forbes Last week, Stifel Financial gaming analyst Steven Wieczynski tried to answer a question being asked daily by the investment community: Which company would benefit the most from the announcement that a COVID-19 vaccine had been developed? “It seems like all we have been doing over the last couple months has been studying possible vaccine/antibody treatments given our entire gaming/leisure universe has essentially turned into biotech,” Wieczynski said. He pointed out added his team isn’t, “remotely smart enough to practice medicine or have an understanding about what goes into developing a COVID-19 vaccine.” Wieczynski said the Las Vegas Strip’s recovery is “highly dependent” on a vaccine, which would immediately boost group and convention bookings. The regional casino markets would be strengthened by the removal of capacity limits. The upside for Caesars Entertainment, he said, could be a 40.9% boost in the company’s value. Until that time, casino visits will include facial coverings, hand sanitizers, and plexiglass dividers on blackjack and poker tables that look something like the “cone of silence” from the “Get Smart” television series. At least the million- dollar slot jackpot winners, who often want to maintain anonymity, can keep their identity hidden behind a mask when receiving a ceremonial giant check for a publicity photo. 2020 has been a year like no other for this industry. Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at email@example.com. Follow @howardstutz on Twitter.