Gamblers blow R10bn as casinos hit jackpot - Sunday 12th of June 2005

South Africans blew R9,9bn gambling at casinos, on the horses, bingo and limited payout machines in the year to March, a 22% increase on the R8,1bn they wagered last year, according to the latest statistics from the National Gambling Board.

This spending represents a significant increase in income and profits for the country’s big gaming groups and their empowerment partners, including Sun International, Peermont Global, Gold Reef Casino Resorts, Phumelela Gaming and Leisure and Hosken Consolidated Investments (HCI), all of which have invested heavily in casinos.

The National Gambling Board’s acting GM of strategic operations, Michael Burns, said on Wednesday that gross gambling revenue— casino income after winnings payouts, but before levies, taxes and operating costs— was a truer reflection of the amount spent by gamblers than total turnover, which contains some double counting because gamblers often used some of their winnings to bet again.

The return to punters is determined by legislation, and although it varies slightly from province to province it is generally about 80% at casino tables, about 85% at slot machines and about 75% on horse racing and totalisators because of their high operating costs.

The board’s figures show that Gauteng takes 44% of gross gambling revenue, followed by KwaZulu-Natal and Western Cape with 16% each. Casinos account for 87,6%, or R8,7bn, of revenue from gambling, followed by the horse racing and totalisator industry with 11,9%, or R1,2bn.

Bingo and limited payout machines garner only 0,2% and 0,3% of gross gambling revenue re spectively, but limited payout machines have made phenomenal progress in the two provinces where they have been established in the past couple of years.

In Mpumalanga, where these machines have been available for the full 12 months to end-March, revenue rose by 24% to R6,25m by the end of March from R5,02m at the end of June.

In the Western Cape, revenue from limited payout machines quadrupled to R7,6m in the fourth quarter from R1,9mbn in the third quarter, as more machines were introduced.

In the limited-payout machine industry, Vukani Gaming, which is owned by HCI, has now secured licences in three provinces — Mpumalanga, West ern Cape and Eastern Cape.

Strong consumer spending on gambling is reflected in the profits announced posted by the major listed companies. Sun International recently reported that fully diluted headline earnings a share rose 61% in the six months to December over the year before, after a 19% increase in gaming revenues.

Gold Reef grew headline earnings a share 46,4% in the year to December — its sixth successive year of growth in headline earnings — while Peermont Global grew headline earnings by 24,6% in the same period.

Other news from around the same time

The chips are down - Sunday 12th of June 2005

PUT your cards on the table or quit.That's the ultimatum from city chiefs to firms who want to build....


BOOKIES FEAR EXCHANGE - Sunday 12th of June 2005

There's been a major gamble ahead of this afternoon's action at Royal Ascot at York, with the Dermot....


THE independence of PartyGaming’s non-executive directors was called into question last night after it emerged that they will receive big payments when the internet poker company completes its £4.7 - Sunday 12th of June 2005

IT IS a golden rule of poker that if you sit down at the table and cannot spot the sucker who is lia....


Non-execs to net big fees in float of PartyGaming - Sunday 12th of June 2005

THE independence of PartyGaming’s non-executive directors was called into question last night afte....


Bally’s to get new name New owner plans rebrand - Sunday 12th of June 2005

When they coined the term "identity crisis," they must have been thinking about Bally's At....


California tribal casinos earn most in U.S - Sunday 12th of June 2005

The nation's 405 Indian casinos generated about $19 billion in gross revenues last year, a 12 percen....


Governor reaches casino deals with two tribes - Sunday 12th of June 2005

Gov. Arnold Schwarzenegger announced agreements Thursday to allow two of California's largest Indian....


Singapore delays request for casino proposals - Sunday 12th of June 2005

Singapore needs more time to review the feedback from bidders to operate the city-state's first two ....


MGM Mirage finalizes deal to develop, manage N.Y. casino - Sunday 12th of June 2005

MGM Mirage said it has signed a definitive agreement to develop and manage a $170 million casino at ....


Machine makers vie for slots in Macau gambling boom - Sunday 12th of June 2005

Slot machine makers are jostling to hit the jackpot in Macau, where the world's fastest growing casi....