The monthly revenues continued to rise for the trio of Detroit casinos in November.
The Michigan Gaming Control Board released last month’s revenue for Detroit’s three commercial casinos on Wednesday, reporting an aggregate revenue of $124.2 million for November. That number is a 5.6% increase from the revenue posted in November 2018, but for the whole year through Nov. 30, the revenue has seen an increase of just 0.7%.
November also provided an uptick in revenue compared to October 2019, which posted an aggregate revenue of $115.7 million. The $8.5 million increase represented a 7.4% bump.
In comparison to November 2018, all three casinos saw their monthly revenues rise. MGM earned a 2.8% hike to $53.9 mm, MotorCity rose 7.2% to $40 mm, and Greektown saw an increase of 8.7% to $29.5 mm.
MGM continues to hold the largest market share at 43%, up 1% from October. MotorCity captured 33%, down 1% from last month, and Greektown remained at 24%.
With an increase in revenue, the state also saw an increase in taxes paid as all three Detroit casinos paid a total of $10.1 mm to the State of Michigan in the month of November plus an additional $19.7 mm in wagering taxes and development agreement taxes to the city of Detroit for the month.
New avenues around the corner
The 0.7% year-over-year increase in revenue aggregate could see a healthy rise in 2020 should the impending Lawful Internet Gaming Act and Lawful Sports Betting Act get signed into law by Gov. Gretchen Whitmer in the next few days.
The three casinos will likely be the first to acquire what will no doubt be lucrative licenses to offer mobile sports betting, online casino games, online poker, and even daily fantasy sports to Michigan’s population of nearly 10 million. Whether they decide to build out their own mobile offerings or partner with some of the more recognized brands in the space, like FanDuel, DraftKings, or William Hill, the expansion of iGaming will likely be a major boost to profits.
MGM is already in a position to take advantage of a mobile market with its own branded BetMGM Sportsbook, which already operates in the legalized market of New Jersey and has plans to expand into Pennsylvania.
More taxes as well
Of course, the expansion of gaming in the state will result in all online operators, including any Detroit’s three casinos that participate, paying their fair share of additional taxes.
The bills, which have been passed through the Senate, include an 8.4% tax rate on all online/mobile sports betting and daily fantasy sports revenue.
However, when it comes to iGaming, including online casino games like blackjack, the tax rate is significantly higher. Operators offering iGaming will pay taxes on a “graduated tax” scale based on adjusted gross receipts. For operators that make $4 million or less, the tax rate starts at 20%, and it climbs all the way up to 28% for those that make more than $12 million. Detroit-based operators will have to pay an additional 3.25% tax.
Should the package of internet gaming bills be signed by Gov. Whitmer, as they are expected to be by the end of the week, there will likely be a rise in revenues for all three Detroit casinos in 2020.
Photo by Cynthia Douglas / Shutterstock.com
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