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Stockholders Shudder as Gaming Industry Revenues Dip11 February 2001LAS VEGAS – Feb. 11, 2001 – As reported by the Las Vegas Review-Journal: “The year 2000 gave investors in gaming stocks major heartburn as companies reported gambling revenue dipping for the first time in two years. That sent shudders through gaming stocks as brokerage houses downgraded the sector and several companies in particular, including MGM Mirage, Harrah's Entertainment, Mandalay Resort Group and Park Place Entertainment. ”…As Bear Stearns gaming analyst Jason Ader noted in a release issued in response to the September gaming figures, the year-to-year comparison in gaming revenue may be more indicative of unique conditions back in September 1999 -- which saw the De La Hoya vs. Trinidad fight and the opening of Paris -- than evidence of overall market weakening. ”Other data shows Las Vegas' outlook remains strong with volume increasing as the global economy continued growing. Some 33.8 million visitors arrived here in 1999, a 10 percent increase over 1998. With the Federal Reserve's recent interest rate cut and the stock market's tentative efforts to rebound, the fear of a recession stalling future growth may still be held in check. ”At the same time the number of rooms grew only 4.3 percent over the same period to a total of 122,675, according to the Las Vegas Convention and Visitors Authority. ”…This all means that the opportunity remains to add capacity to accommodate continued growth without overbuilding and starting a discounting war in a bid for customers. ”…Most interestingly, as convention and business trips have taken a larger share of revenues, the percentage of people gambling has remained constant -- around 87 to 89 percent over the past five years -- even though you've seen trips reduce and fewer first timers coming. ”Why has the gaming experience remained constant even though the influx of visitors and types of destinations changed rapidly? Simply put, it's all about adrenaline, the unique thrill that only gambling can provide…” |