Casino Income: Earnings of World’s Major Gambling Companies
Due to a proper approach to the gambling organization, casinos provide their owners and investors with high income. Let’s examine revenues of large casinos and their shareholders.
The gambling industry is a profitable business area, but there are a lot of factors that can negatively affect the popularity of casinos: state regulation, high risks, and severe competition. Regardless of offline or online formats, a gambling venue can either generate large income or cause losses. However, not only do gambling business owners benefit in case of profitability but also its investors. Well, what is the actual size of revenues obtained by land-based and virtual casinos in different countries?
Proceeds of US gambling venues
The USA is one of the world’s largest markets of gambling operators. According to the 2017’s reports by Nevada Gaming Commission, casino income was $980 million, 3.25% of growth in comparison with 2016. Based on marketing research, Technavio predicts that profit of all American gambling venues will increase up to $93 billion by 2020.
The USA is one of the few countries permitting casino advertising, which makes marketing campaigns of gambling clubs more efficient and attracts more people interested in games of chance. AGA State of the States estimated that gambling operators of this country obtained income of $40 billion in 2017. One of the world’s best-known gambling points, Las Vegas, is located in the USA. This popular place is regularly visited by the increasing amount of players from various countries.
In 2017, casinos in the heart of the city earned $110.3 million, showing the increase in total return by 111.3% in comparison with 2016. Some investment analysts predict that gambling venues in Las Vegas can substantially benefit from the influx of Chinese tourists and from the domestic demand in the Unites States.
Profit of US-based Las Vegas Sands
Las Vegas Sands, an owner of hotels and casinos, is consistently in the top list of US gambling houses in terms of revenues. The list of leaders in profit for the year was supplemented by Las Vegas Sands in 2013 because of earning $4.76 billion, net gain of which was $2.4 billion (the annual growth of proceeds was 25.6%).
According to the report on revenues for Q1 2018, its net income in this period of 2019 increased by 2.5% and reached $3.48 billion. Net earnings in the same period of 2019 grew by 2.5% and amounted to $3.48 billion. As of today, trading volumes of Las Vegas Sands Corp stocksare $8 million.
The company earns on both gambling and hotel businesses. Besides, Las Vegas Sands pays dividends to its shareholders. In 2018, they received $19.7 billion in total using dividends and stock buyback.
Asian gambling facilities
As the world's most populous region, Asia features high growth rates of the gambling market: according to Union Gaming Securities Asia Ltd, investments in the Asian gambling industry exceed $65 billion. 43.4% of the world’s entire gambling volume accounts for the Asian region. It is related to the number of people living there and the high level of gambling regulation. Since July 1, 2019, the National Supervisory Authority of Japan started its operations, reanimating the legal gambling market and attracting more investors.
Casino activity is forbidden in China, but it has a separate gambling zone called Macau allowing operators to successfully run their business and get profit. For example, income of Wynn in Macau grew by 300% in Q1 2018 with the total value of $187 million. Macau is widely regarded as the center of Asian gambling life. Revenues from casinos and nightclubs provide local budgets with 70% of total proceeds. Analysts expect that gross income of Macau-based casinos can reach $53 billion by 2022.
Russian gambling market condition
Casino operations are prohibited in Russia, safe for four special gambling zones: Krasnaya Polyana, Primorye, Siberian Coin, and Yantarnaya. In 2017, Krasnaya Polyana added 164.8 million RUB to the local budget, exceeding previous year’s performance almost twice.
In 2018, Primorye paid taxes amounting to 100 million RUB to the state treasury. In 2019, one expects even more deductions: approximately 110 million RUB.
Income of Georgian casinos
Land-based and virtual gambling activity is officially permitted in Georgia. Therefore, its gambling business is well developed, alluring many local and foreign investors. UK-based Paddy Power Betfair acquired 51% of shares of the Georgian gambling giant, Adjarabet, in early 2019.
The Georgian gambling industry enhanced by 40% between 2016 and 2018. Currently, it generates profit of $235 million. In 2018, Adjarabet collected the proceeds of $84 million with the profit ratio of $26.11 million. The gambling giant owns 40% of the country’s gambling market.
Is it reliable to invest in casinos?
Investing in the gambling sector can result in huge revenues if selecting a reliable and promising company. Moreover, one should take into account that the gambling industry is accompanied by high risks and strong competition, thus not all companies manage to succeed. The most profitable are firms earning not only on gambling but also on other sources (hotel business, real estate, travel industry).