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Gaming Guru

Howard Stutz
 

Primm store poised to reap benefits of California's Powerball status

8 April 2013

By Howard Stutz

The Primm Valley Lotto Store isn’t much of a convenience outlet.

Bottled beverages and ice make up 100 percent of its inventory.

But that wasn’t why it was opened in 1992 on the California side of the border with Nevada, just off Interstate 15 and adjacent to the three Primm Valley casinos.

Because in part of its proximity to Las Vegas, the store regularly ranks as the No. 1 or No. 2 location in the state for lottery sales, according to a spokeswoman for the California Lottery Commission.

Long lines that routinely snake around the building when lottery jackpots reach into the millions of dollars are testament to the store’s popularity.

With California’s entry into the multistate Powerball Lottery, which produced a record $587.5 million jackpot last year, Lotto Store owner Affinity Gaming figured it better improve the facility.

California starts Powerball sales on Monday. Customers going to the Primm Valley Lotto Store will find a new look and a revamped location thanks to a $200,000 investment by Affinity.

The store added four new lottery service stations to the seven existing terminals.

Also, two self-service kiosks and additional scratch-off ticket vending machines were added. The store was given a new look top-to-bottom.

Loren Gill, general manager of Primm Valley Casinos, which operates the store, said Friday he hopes the changes will reduce the long lines and the amount of time customers have to wait to buy lottery tickets.

There are also plans to add more items to the convenience store side of the business, such as packaged snack offerings.

“I think it’s really smart money for us,” Gill said. “The casinos benefit from the business. We know the life-changing jackpots that are offered by Powerball will attract more customers to the store.”

Gill said plans are in the works to add lottery ticket sales to Primm’s customer loyalty program.

“When customers are here, they’ll play a slot machine or a table game and try one of the restaurants,” Gill said. “We see a lot of crossover business.”

Affinity, which was created after the bankruptcy reorganization of Herbst Gaming in December 2010, operates 12 casinos in four states.

The three Primm properties, including Primm Valley, Buffalo Bill’s and Whiskey Pete’s, have been upgraded to offer new restaurants and other amenities.

“We’ve done a lot of the heavy lifting with the casinos,” Gill said. “The Lotto Store needed some improvements.”

Opened as the Dry Lake Lotto Store, in 1992, California Lottery officials have said it routinely is the leading monthly and annual retail outlet for sales out of the 20,000 locations throughout the state.

MGM Mirage — now known as MGM Resorts International — acquired the Primm casinos in 1999 and the Lotto Outlet Store in 2001. Herbst Gaming acquired the entire Primm package in 2005.

Affinity Gaming receives an undisclosed small percentage of the lottery ticket sales that take place in the store. Any jackpots won at the store trigger automatic bonuses for the retailer.

In its quarterly earnings reports, Affinity includes revenues from lottery ticket sales within the company’s overall Nevada revenue category, which includes gaming and nongaming revenues from its casinos in the southern and northern parts of the state.

Gasoline sale revenues from the Primm-owned service station are also included with the revenues from Nevada. Affinity does not publicly break out revenues from each casino.

In the fourth quarter that ended Dec. 31, Affinity said Primm experienced a $1.4 million decrease in fuel sales and related revenues.

Affinity Chief Financial Officer Donna Lehmann said the lottery ticket sales are classified as a “nonmaterial amenity.”

California’s entrance into the Powerball Lottery marks the 45th state to join the shared jackpot system.

In the $2 Powerball game, jackpots start at $40 million and increase by $10 million with every roll. Players pick five numbers from 1 to 59 and one red Powerball number from 1 to 35.

Drawings are held every Wednesday and Saturday at 7:59 p.m. PST.

Besides the jackpot, there are eight additional ways to win prizes. The amounts will vary because of the state’s pari-mutuel rules.