RubinBrown Gaming Stats 2012

Executive Summary

Introduction Commercial & Tribal Gaming Stats is released by RubinBrown each April and provides a comprehensive and comparative report of key gaming statistics of commercial and tribal gaming operations (excluding racinos) across the nation. The Commercial Gaming Stats include high level national and regional comparisons as well as detailed state-by-state information of 2011 gross gaming revenues, tax contributions, admissions, electronic gaming devices, table games, and key headlines that impacted the gaming industry this past year. The Tribal Gaming Stats include an analysis of 2010 gross gaming revenues, number of operations, regional revenue trends and the developments within each of the seven National Indian Gaming Commission (NIGC) Regions. The tribal data focuses on select 2011 state contribution (revenues shared with state governments, in exchange for the exclusive right to offer Class III gaming) data and the 2010 national revenue results. The 2011 national tribal data will be available in July 2012. Information used to compile the statistics was obtained from the state gaming regulatory authorities and the National Indian Gaming Commission (see page 26 for the complete listing of sources). The data is compiled by RubinBrown’s Hospitality & Gaming Services group to provide a consolidated National analysis. General Industry Economic Update As a highly discretionary element of consumer spending, the gaming industry continues to be weighed down from the lingering impacts of the Great Recession of 2008 and has experienced nominal growth in 2010 and 2011. Within the United States, there are 35 states, excluding those that only offer pari-mutuel (racino) facilities, which offer commercial and/ or tribal casinos. Overall, the Casino Gaming industry (excluding pari-mutuel wagering and lotteries) generates approximately $58 billion a year, with a relatively equal split between tribal (46%) and commercial (54%) gaming. Focusing on commercial gaming, there are 648 land based and river-boat casinos located in 15 states. In 2011, the industry generated $32.5 billion in gaming revenues, increasing by 2.4%. Of the 15 states offering commercial gaming, 10 saw increased revenues during 2011. While the overall commercial gaming industry saw increased revenue, existing properties continue to face challenges. In the last year, several states have legalized or expanded commercial gaming which has increased the competition for pre-existing properties (see specific stories within the Commercial Gaming Headlines section starting on page 9).

Within the tribal gaming industry, there are 239 tribes operating 422 Class II and Class III casinos in 28 states. In 2010, Tribal gaming revenue remained flat at $26.8 billion. However, the 2011 state regulatory data indicates the tribal industry revenues increased in 2011. Until recently, tribes in states like New York and Kansas have benefitted from being the only source of casino gaming; however, state legalization efforts have shifted the landscape and increased the competition tribes experience from their commercial counterparts. Overall, with growth in key commercial and tribal markets (including markets such as Arizona and Illinois), analysts believe the U.S. gaming industry turned the corner in 2011 and has re-entered into a period of growth. The extent of the growth will remain highly contingent on the continued increases in consumer confidence and declines in unemployment. 2012 Industry Forecast As the industry continues to grow and develop, leaders are optimistic in the future of gaming. There is excitement over recovering numbers due to technological advances including new and revised standards and the introduction of mobile and internet gaming (iGaming). However, there is also uncertainty in the market relating to the upcoming changes in technology. The U.S. gaming industry will soon face a major challenge with the legalization of internet gaming and the regulation associated with it.

DISCLAIMER: Gaming Stats, a publication of RubinBrown LLP, is designed to provide general information regarding the subject matter covered. Although prepared by professionals, its contents should not be construed as the rendering of advice regarding specific situations. If accounting, legal or other expert assistance is needed, consult with your professional business advisor. Please call RubinBrown with any questions (contact information is located on the back cover).

Commercial & Tribal Gaming Stats 2012 - RubinBrown 2