Las Vegas casinos are closed. This has never happened ever since gambling was legalized in Nevada back in the 1930s. Therefore, it’s only natural to assume that this is a huge deal for them, as a lot will change during the shutdown — not much of it is positive, to be honest.
First of all, we have to look at how long casino operators will be able to sustain their presence and pay their workers during this economic punch in the face. There are many estimates right now, and projections vary based on the estimate.
Companies such as Caesars Entertainment and MGM Resorts will be able to last from 8 to 16 months with their money, as stated on Barrons. When translated to liquidity days, this is estimated to 239 days for Caesars and 564 days for MGM.
On the other hand, there are companies that are present elsewhere — mainly in Asia, and they are Wynn Resorts and Las Vegas Sands. Both of them had to close their doors in Macau when the virus appeared in China.,
However, the shutdown lasted for two weeks only, and the Chinese are now slowly and carefully recovering.
Therefore, these two companies will have enough cash to last anywhere from 15 to 20 months with no presence in Las Vegas, as stated in Macquarie Research Analyst Chad Bynon.
Macquarie Research published a report with approximate amounts of how much casino operators are burning on a daily basis with no people visiting properties in Las Vegas. According to Beynon, these things range from five months to a year ad a half. Most of the money these operators are now spending are obligations to their employees, to banks, and to various projects they started.
How Much Can Individual Casinos Last?
According to the analysis by Macquarie, Monarch Casino and Resort (Reno) will be able to last for 14.3 months, as it is burning roughly $300,000 a day.
The next one in line is Red Rock Resorts with 13.8 months and a daily burn of $1.7 million. After that, it’s Golden Entertainment with 10.4 months and an approximate burn of $1 million on a daily basis.
Boyd Gaming Corp would last for 9.4 months with a daily burn of $3.2 million.
MGM Resorts International comes next with an approximate life of nine months. The company burns approximately $14.4 million a day. Penn National is the last one on the list with 5.2 months, burning a total of $6.4 million a day.
Apart from the casino operators themselves being affected by the lockdown, the entire economy of Nevada and the whole US will be affected a lot. According to the American Gaming Association, the country loses about $4.7 billion for every day that casinos are closed.
If the shutdown lasts for eight weeks, the country will lose about $43.5 billion.
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