New Jersey iGaming Revenues Fall 8.4% To New Low In November

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Tuesday, December 16th, 2014 | Written by Lucy Brown

Following on from October‘s online gambling results, which at $9.5 million were the lowest ever on record, the New Jersey Division of Gaming Enforcement has now released its gambling figures for November revealing a further contraction in the Garden State’s iGaming industry, this time shrinking by 8.42% compared to last month with just $8.7 million in revenues. Including land-based casino results, New Jersey revenues came in at $202.5 million in November, down by 10.4% from the $225.7 million generated in November 2013.

Online Poker Plumbs New Depths

New Jersey currently has just two poker licensees, namely the Borgata (partypoker, Borgata Poker) and Caesars, (WSOP, 888), and last month the two operators enjoyed a 53.1% to 46.9% share of New Jersey’s iPoker market. Overall, they generated a combined $1,877,603 in revenues from online poker, down by $90,301 or 4.59% compared to October. Striking a positive note on the disappointing figures, analysts have pointed out that November had one less day than October, without which revenues would have been lower by just 1.4%, while also reiterating a point made last month by Global Gaming Business Magazine’s Roger Gros about the winter season, stating:

“We might expect to see some better internet gambling figures in the winter, especially if it is cold or there is bad weather, because people will be looking for something to do while they are shut in.”

Online Gambling Hits New Low

Online gambling as a whole brought in $8.74 million in November, down by 8.42% compared to last month, with iPoker accounting for $1.87m of revenues, and casino games $6.87m. Worryingly, not only did online gaming buck previous trends by faring worse than online poker in terms of growth, but November’s results also represented a second consecutive month of monthly all-time lows. More positively, however, account signups totaled 27,099 last month, up by 5.7% compared to October.

NJ iGambling For First Twelve Months

With November’s numbers counted, New Jersey now has 12 months of online gambling statistics at its finger tips, with revenues totaling $119.5m for the year to date. Needless to say, that figure is just one-tenth of the $1.2 billion predicted by Governor Chris Christie pre-regulation. Commenting on the figures, Macquarie Securities casino analyst Chad Beynon said:

“We continue to view I-gaming as another amenity for N.J. gamblers, but certainly not the panacea to save the market.”

Overall, online casino games have accounted for 75.9% of revenues, and poker 24.1% or $27 million, while 506,172 accounts have been created since November 26, 2013.

Land-based Casino Results

Last month, Atlantic City casinos generated $202.5m in revenues , lower by 10.3% compared to the $225 million won a year ago when the state had 12 casinos and online gambling was just a few days old. Only including New Jersey’s current eight casinos, however, revenues are actually higher by 11.5% and highlighting the positive effect the shake-up off NJ’s casinos is having on the market, Matt Levinson, chairman of the New Jersey Casino Control Commission, explained:

“While these are difficult times and a lot of casino employees are out of work, several of the current operators have increased staff over last November’s levels. These results show that the market is absorbing the impact of recent casino closures, and most of the current operators are improving. In addition, Internet gambling continues to provide an additional boost to several of the operators”

In fact, in November a number of casinos even reported double digit revenue growth, including Tropicana Casino, Resorts, Borgata Hotel, and The Golden Nugget, whose general manager, Tom Pohlman said:

“I think Golden Nugget is all about customer service and treating customers equally without regard to their worth or value. It’s not only the closed properties we’re seeing many new customers from, but also the open ones.”

NJ Casino Tax Revenues $220m Last Year

With Atlantic City losing a third of its casinos in 2014, and the market halving since peaking in 2006 at $5.2 billion in revenues, some of New Jersey’s resident might be concerned of a knock-on effect on the state’s budget. Nevertheless, this is unlikely to ever be much of a factor, as NJ casino tax revenues of around $220 million a year account for a mere 0.6% of its overall $34.1 billion budget. A decline in the New Jersey State Lottery, for instance, would have a much greater affect generating as it does $2.8 billion a year, twelve times more than the NJ casino industry.