Can A Casino Go Bankrupt?
Gaming operators could eventually seek protection from bankruptcy if they continue to burn their limited money after shutting down operations due to the coronavirus pandemic according to sector experts.
Most people think that casinos are raking up tons of money because the odds are in their favor and opulence screams their decor.
The reality is that plenty of casinos are failing, and a good number are actually going bankrupt, and while income is high, expenses are even higher (employee wages, salaries, and building and furniture loan payments).
Several went under through demolition and bankruptcy, others are just starting to lay the foundation for what is hoped to be a long and prosperous life.
It is not just the casino industry’s natural progression, where it has to go when it’s no longer fresh and shiny.
Four casinos-Revel AC, Trump Plaza Hotel and Casino, Atlantic Club Casino Hotel and Showboat Atlantic Resort-have closed their doors in the past 18 months, losing 8,000 employees their jobs.
The fading fortunes of the gaming industry in Atlantic City have taken a toll on the fiscal situation in the municipality.
An emergency manager was tapped to look into the grim finances of the region.
One explanation why casinos perform so badly is that gaming profits go down. That’s primarily because they’re not being replaced by as many millennials as older gamblers pass on.
Also, as casinos have tightened the games and hotels have increased their guests’ total payment, I think that more and more future visitors are choosing to skip Vegas.
Especially due to the current pandemic outbreak, analysts figure MGM burns through a stunning $14 million a day while its casinos are shuttered, and the other casino groups are hurting similarly.
Analysts claim they will hold out from five and eighteen months, depending on the casino that includes this online gambling malaysia too.
Casinos would need to find ways of lowering expenses in every way. “Wherever they can, they have to economise. Casino companies could also be looking for revenue elsewhere beyond brick and mortar casinos.
Some jurisdictions have legalized online gaming, which could provide a flow of revenues and would help cover the losses of a physical venue itself.
Casino management is also awaiting word now before Congress on the proposed $2 trillion coronavirus relief plan.
It sets aside 25 percent of business money, such as airlines or cruise lines, said initial news reports. However, the decision regarding this matter is still on the gray area.
Before Vegas shut down due to COVID-19, casinos in Macau and China and several of them that are operated by U.S. companies such as MGM (which runs many casinos on the Vegas Strip), Sands (ditto), and Wynn have been shut down.
It reportedly cost the owners a whopping $167M / mo when their Macau casinos closed. (Sands), $100 million /mo. (Wynn), and $56 million / mo. (GMG).
All in all, the outbreak has affected everyone of all kinds of business backgrounds and has been hitting a rough patch and is waiting for the place to be helped.
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