New Jersey Gov. Phil Murphy had released a statement on the fate of the Atlantic City Casinos which turns out to be an extension of the Covid-19 restrictions he placed since the outbreak. This is the 11th time he has extended such restrictions as cases of the disease surge and death rate climbs to almost half a million in the United States.
For Atlantic City casinos, this means they will continue operating at 25% capacity and stick to all previous rules.
This means guests and workers would continue to wear face masks, seating would be reduced at table games, and slot machine banks would have to be rearranged to promote social distancing. These rules are already in effect since the early restrictions were put in place so nothing much changes with these casinos.
The first-term governor didn’t give any assurance that this would be the last extension though he remains optimistic that the vaccination process would pick up under President-elect Joe Biden’s administration.
Murphy, while extending restrictions, advised travelers to desists from all non-essential interstate travel.
Atlantic City Casinos’ Struggle
2020 wasn’t the best year for land-based businesses as Atlantic City casinos felt the brute of the pandemic. With Covid-19 restrictions and lockdowns, these casinos had to shut their doors to control the spread. While the virus continued to ravage all parts of the state, casinos were soon given a chance to continue business but not as they were.
Strict Covid-19 regulations saw them operating at reduced capacity which led to huge drops in revenue. Atlantic City‘s nine casinos saw as much as 44 percent drop in revenue in 2020. The gaming floors recorded $1.512 billion in the year which amounts to a nearly $1.2 billion loss from 2019.
However, with the progress of the vaccine, gaming industry analysts and casino executives believe that 2021 would be a totally different year. Hopefully, ongoing capacity restrictions, urging people to stay home, and suspension of indoor food and beverage service would be lifted giving these casinos and Atlantic City’s economic regime the comeback it deserves.
Reports on the nine months of 2020 show that these casinos scored huge losses as gross operating profits were down 66%. Operators saw as many as 30% of the casinos’ hotel rooms vacant through three quarters of the year. The final quarter and full-year results are yet to be released but it’s likely they won’t show any signs of improvements as Covid-19 restrictions have stayed the same.
However, while land-based casinos struggled, online gaming and mobile sports betting excelled. With lockdowns and restrictions in place, people sought to online casinos to gamble. While this section brought in a lot of revenue, it was not enough to match the casinos’ earnings without the Covid-19 restrictions or the pandemic itself. Land-based gross gaming revenue (GGR) losses were still as much as 17 percent with both land-based and online revenues considered.
While Atlantic City casinos would have to keep their fingers crossed for another 30 days, it is also possible that restrictions would be relaxed in the coming months. The Joe Biden administration has sought to boost vaccination and other measures that would not only see a drop in new cases but also in the number of deaths due to the disease. For now, Atlantic City casinos can simply hope for a brighter future.
