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The COVID-19 pandemic has dug a big hole in the coffers of casino companies and gambling operators. Wynn Resorts is the latest casino company to report a huge loss. The operator has reported a 69% year-on-year fall in the revenue for H1 2020, primarily owing to casino closures.
Casinos in the U.K. are not reopening at least until August 15. Earlier slated to open on August 1, the casinos were not given the green signal by the U.K. government in the wake of increasing COVID-19 cases in northern England.
Harrah’s New Orleans has lost a multi-million dollar tax case against the U.S. state of Louisiana. A three-judge panel of the Baton Rouge appeals court rejected the company’s arguments in a recent hearing. The operator stands to lose $30 to $50 Million in payments, but it can still appeal to the Louisiana Supreme Court.
Meanwhile, Yahoo Sports has entered a partnership with the U.S. National Basketball Association (NBA) to become the NBA’s official marketing partner.
Casino Operator Wynn Resorts Ltd. has reported a 69% revenue fall (year-on-year basis) for H1 2020, as a result of the lockdown of its casinos due to the current pandemic. The operating revenue for the last six months that ended on June 30 reportedly fell to $1.04 Billion, and the net loss before tax was $1.03 Billion. During the same period last year, the casino operator had booked a profit of $302 Million. The lockdown restrictions put in place due to the ongoing global pandemic meant that the operating revenue for H1 was down to $580 Million, from $2.33 Billion in 2019.
In Q2, the operating revenue fell 95% (year-on-year basis) to $85.7 million. Wynn Resorts Ltd. booked a net loss of $637.6 Million during Q2 this year compared to a net income of $94.6 Million in the same quarter last year.
Representatives of the casino operator said that they have reopened Wynn Las Vegas and Encore campus in early June, with Encore Boston Harbor resuming operations on July 12. They sounded confident that the company`s Macau properties will recover towards the end of the year.
Wynn Resorts CEO Matt Maddox said, “Our leadership team continues to work closely with our host communities, fellow industry leaders, and world-class medical experts to implement and advance strategies to mitigate the impact of the virus on our team members, our guests, and our broader communities. We are pleased to be up and running again in each of our markets.”
The U.K. government has further delayed the reopening of casinos in England until at least August 15. The casinos were among the many indoor venues that were earlier granted permission to resume business operations from August 1.
The decision has been taken because of the increasing number of COVID-19 cases in parts of northern England. The proposed trials of select sports events with a few fans in attendance have also been scrapped.
At a Downing Street press conference, Prime Minister Boris Johnson said, “We simply cannot take the risk; we will continue to study the data carefully and move forward with our intention to open up as soon as we can.”
Betting and Gaming Council (BGC) CEO Michael Dugher responded by questioning the decision. In a post on Twitter, Dugher said that there is no evidence that casinos are higher risk venues, and continued closure is a significant threat to jobs.
There is no evidence that casinos are “higher risk” venues + what happened to the Govt’s local lockdown strategy? Why should a casino business remain closed in Bristol in the south west, where Covid is low, because there’s a spike in greater Manchester? Big threat to jobs.
— Michael Dugher (@MichaelDugher) July 31, 2020
Casinos in the U.K. have remained shuttered since March 20, though other land-based gambling venues like betting shops and bingo halls have been given permission to reopen.
The owners of Harrah’s New Orleans are on the losing end of the million-dollar tax case that they have been fighting against the state of Louisiana. A three-judge panel of the Baton Rouge appeals court ruled 2-1 in favor of the state that the casino company owes them taxes dating to 2001. The court upheld the 2019 decision by 19th Judicial District Court Judge of Baton Rouge, William Morvant.
Harrah’s argument has been that a 2001 law exempts the gaming operator from paying sales and occupancy taxes to the state on comp-ed hotel rooms owned by others. The amendment to the casino’s hotel tax obligations was approved due to the original operator of the casino filing a voluntary petition seeking relief under the U.S. Bankruptcy Code.
The Department of Revenue countered this with the submission that if the casino company gives away a hotel room, it should still pay the hotel taxes on that room. The current tax is 10%, so for a $200 hotel room, the state would collect $20.
In the appeals court decision, Judges J. Michael McDonald and Wayne Ray Chutz ruled in favor of the revenue department. Only Judge Mitchell Theriot was in support of Harrah’s argument.
SEC filings by Harrah’s parent Caesars indicate that the company has set aside more than $40 Million in the event of a losing verdict. The company can appeal to the Louisiana Supreme Court.
Yahoo Sports has signed a deal with the U.S. National Basketball Association (NBA) to become NBA’s official marketing partner.
The two will work together on a range of fantasy and sports betting initiatives. The deal will see Yahoo Sports offer exclusive season-long fantasy games and create NBA-branded daily fantasy and sports betting integrations.
The agreement permits Yahoo Sports to deliver expanded NBA content across all its platforms, including out-of-market games through NBA League Pass, engaging fans with fantasy & betting through digital overlays.
Additionally, Yahoo has the right to use game footage to create content such as game previews and recaps to help fans in fantasy and sports betting.
The two entities will also produce two shows focused on fantasy games and betting that will coincide with the NBA Conference Finals and NBA Finals.