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The global casinos & gaming sector grew by 7.5% in 2010 to reach a value of $381.8 billion

Transcript of Global Casinos & Gaming

INDUSTRY PROFILE

Global Casinos & GamingReference Code: 0199-2019 Publication Date: May 2011

www.datamonitor.comDatamonitor USA 245 Fifth Avenue 4th Floor New York, NY 10016 USA t: +1 212 686 7400 f: +1 212 686 2626 e: [email protected] Datamonitor Europe 119 Farringdon Road London EC1R 3DA United Kingdom t: +44 20 7551 9000 f: +44 20 7675 7500 e: [email protected] Datamonitor Middle East and North Africa Datamonitor PO Box 24893 Dubai, UAE t: +49 69 9754 4517 f: +49 69 9754 4900 e: [email protected] datamonitor.com Datamonitor Asia Pacific Level 46, 2 Park Street Sydney, NSW 2000 Australia

t: +61 2 8705 6900 f: +61 2 8705 6901 e: [email protected]r.com

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EXECUTIVE SUMMARY

EXECUTIVE SUMMARYMarket valueThe global casinos & gaming sector grew by 7.5% in 2010 to reach a value of $381.8 billion.

Market value forecastIn 2015, the global casinos & gaming sector is forecast to have a value of $512.9 billion, an increase of 34.3% since 2010.

Market segmentation ILotteries is the largest segment of the global casinos & gaming sector (apart from the other segment), accounting for 29.2% of the sector's total value.

Market segmentation IIAsia-Pacific accounts for 43.2% of the global casinos & gaming sector value.

Market rivalryThe casinos and gaming sector is subject to huge regional variation with some countries outlawing it completely and others imposing very little regulation.

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CONTENTS

TABLE OF CONTENTSEXECUTIVE SUMMARY MARKET OVERVIEW Market definition Research highlights Market analysis MARKET VALUE MARKET SEGMENTATION I MARKET SEGMENTATION II FIVE FORCES ANALYSIS Summary Buyer power Supplier power New entrants Substitutes Rivalry LEADING COMPANIES Harrah's Entertainment, Inc. Las Vegas Sands Corp. MGM Resorts International New York State Lottery MARKET FORECASTS Market value forecast APPENDIX Methodology Industry associations Related Datamonitor research Disclaimer ABOUT DATAMONITOR 2 7 7 8 9 10 11 12 13 13 15 17 18 20 21 22 22 26 30 33 35 35 36 36 37 37 39 40

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CONTENTS

Premium Reports Summary Reports Datamonitor consulting

40 40 40

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CONTENTS

LIST OF TABLESTable 1: Table 2: Table 3: Table 4: Table 5: Table 6: Table 7: Table 8: Table 9: Table 10: Table 11: Table 12: Table 13: Table 14: Global casinos & gaming sector value: $ billion, 200610 Global casinos & gaming sector segmentation I:% share, by value, 2010 Global casinos & gaming sector segmentation II: % share, by value, 2010 Harrah's Entertainment, Inc.: key facts Harrah's Entertainment, Inc.: key financials ($) Harrah's Entertainment, Inc.: key financial ratios Las Vegas Sands Corp.: key facts Las Vegas Sands Corp.: key financials ($) Las Vegas Sands Corp.: key financial ratios MGM Resorts International: key facts MGM Resorts International: key financials ($) MGM Resorts International: key financial ratios New York State Lottery: key facts Global casinos & gaming sector value forecast: $ billion, 201015 10 11 12 22 24 24 26 28 28 30 31 31 33 35

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CONTENTS

LIST OF FIGURESFigure 1: Figure 2: Figure 3: Figure 4: Figure 5: Figure 6: Figure 7: Global casinos & gaming sector value: $ billion, 200610 Global casinos & gaming sector segmentation I:% share, by value, 2010 Global casinos & gaming sector segmentation II: % share, by value, 2010 Forces driving competition in the global casinos & gaming sector, 2010 Drivers of buyer power in the global casinos & gaming sector, 2010 Drivers of supplier power in the global casinos & gaming sector, 2010 Factors influencing the likelihood of new entrants in the global casinos & gaming sector, 2010 Factors influencing the threat of substitutes in the global casinos & gaming sector, 2010 Drivers of degree of rivalry in the global casinos & gaming sector, 2010 Harrah's Entertainment, Inc.: revenues & profitability Harrah's Entertainment, Inc.: assets & liabilities Las Vegas Sands Corp.: revenues & profitability Las Vegas Sands Corp.: assets & liabilities MGM Resorts International: revenues & profitability MGM Resorts International: assets & liabilities Global casinos & gaming sector value forecast: $ billion, 201015 10 11 12 13 15 17

18 20 21 25 25 29 29 32 32 35

Figure 8: Figure 9: Figure 10: Figure 11: Figure 12: Figure 13: Figure 14: Figure 15: Figure 16:

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MARKET OVERVIEW

MARKET OVERVIEWMarket definitionThe casinos and gaming market consists of all forms of betting and gaming. All values are stated in terms of gross gaming win. This is the total amount waged by customers minus the total amount paid out to customers as winnings, but before the payment of any applicable taxes, disbursements to charitable or other causes by games established for those purposes, or other expenses. The casinos segment covers all gambling activities carried out within casino establishments, such as card games, roulette, and slot machines located in casinos; tips and admission fees are included, but additional revenues such as sales of food, drink, and accommodation are excluded. The lotteries segment covers all state, private, and charitable lotteries, and includes traditional draws, scratchcard games, and similar products offered by lottery operators. The sports betting and related segment covers gambling on the outcome of horse races, football matches, and other events, and includes gambling services offered by bookmakers and also parimutuel/totalisator operators. The other segment covers bingo, slot machines located outside casinos, pachinko, etc. In North America, so-called 'Indian casinos' are covered in this segment, not the casino segment. Online casino and gaming activity, with the exception of online purchases of lottery entry, is not included. Recreation-only slot machines that do not pay out any form of prize are excluded. The report only includes gaming activities that are legal in the country where they are offered. All currency conversions were calculated using constant average annual 2010 exchange rates. For the purposes of this report, the global market consists of North America, South America, Western Europe, Eastern Europe, MEA, and Asia-Pacific. North America consists of Canada, Mexico, and the United States. South America comprises Argentina, Brazil, Chile, Colombia, and Venezuela. Western Europe comprises Belgium, Denmark, France, Germany, Greece, Italy, the Netherlands, Norway, Spain, Sweden, Switzerland, Turkey, and the United Kingdom. Eastern Europe comprises the Czech Republic, Hungary, Poland, Romania, Russia, and Ukraine. Asia-Pacific comprises Australia, China, India, Indonesia, Japan, New Zealand, Singapore, South Korea, Taiwan, and Thailand. Middle East-Africa (MEA) comprises Egypt, Israel, Nigeria, Saudi Arabia, South Africa, and United Arab Emirates.

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MARKET OVERVIEW

Research highlightsThe global casinos & gaming sector had total gross gaming win of $381.8 billion in 2010, representing a compound annual growth rate (CAGR) of 3.7% for the period spanning 2006-2010. The other segment, which includes games such as bingo, pachinko, and non-casino gaming machines, was the sector's most lucrative in 2010. The performance of the sector is forecast to accelerate, with an anticipated CAGR of 6.1% for the fiveyear period 2010-2015, which is expected to drive the sector to a value of $512.9 billion by the end of 2015.

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MARKET OVERVIEW

Market analysisThe global casinos & gaming sector has experienced steady growth in recent years and is expected to continue to do so at an accelerated rate. It should be noted that the casinos and gaming sector is subject to huge regional variation, with some countries outlawing it completely and others imposing very little regulation. The global casinos & gaming sector had total gross gaming win of $381.8 billion in 2010, representing a compound annual growth rate (CAGR) of 3.7% for the period spanning 2006-2010. In comparison, the European and Asia-Pacific sectors grew with CAGRs of 1.8% and 7.1% respectively, over the same period, to reach respective values of $95.1 billion and $164.7 billion in 2010. The other segment, which includes games such as bingo, pachinko, and non-casino gaming machines, was the sector's most lucrative in 2010, with total gross gaming win of $117.6 billion, equivalent to 30.8% of the sector's overall value. The lotteries segment contributed gross gaming win of $111.4 billion in 2010, equating to 29.2% of the sector's aggregate value. The performance of the sector is forecast to accelerate, with an anticipated CAGR of 6.1% for the fiveyear period 2010-2015, which is expected to drive the sector to a value of $512.9 billion by the end of 2015. Comparatively, the European and Asia-Pacific sectors will grow with CAGRs of 5.9% and 6.2% respectively, over the same period, to reach respective values of $126.4 billion and $222.4 billion in 2015.

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MARKET VALUE

MARKET VALUEThe global casinos & gaming sector grew by 7.5% in 2010 to reach a value of $381.8 billion. The compound annual growth rate of the sector in the period 200610 was 3.7%. Table 1: Year 2006 2007 2008 2009 2010 CAGR: 200610 Source: Datamonitor Global casinos & gaming sector value: $ billion, 200610 $ billion 330.4 345.4 354.5 355.2 381.8 billion 248.8 260.1 267.0 267.5 287.5 % Growth 4.5% 2.6% 0.2% 7.5% 3.7% DATAMONITOR

Figure 1:

Global casinos & gaming sector value: $ billion, 200610

Source: Datamonitor

DATAMONITOR

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MARKET SEGMENTATION I

MARKET SEGMENTATION ILotteries is the largest segment (apart from the other segment) of the global casinos & gaming sector, accounting for 29.2% of the sector's total value. The casinos segment accounts for a further 21.9% of the sector. Table 2: Category Lotteries Casinos Sports betting and related Other Total Source: Datamonitor Global casinos & gaming sector segmentation I:% share, by value, 2010 % Share 29.2% 21.9% 18.1% 30.8% 100% DATAMONITOR

Figure 2:

Global casinos & gaming sector segmentation I:% share, by value, 2010

Source: Datamonitor

DATAMONITOR

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MARKET SEGMENTATION II

MARKET SEGMENTATION IIAsia-Pacific accounts for 43.2% of the global casinos & gaming sector value. Americas accounts for a further 31.3% of the global sector. Table 3: Category Asia-Pacific Americas Europe Middle East & Africa Total Source: Datamonitor Global casinos & gaming sector segmentation II: % share, by value, 2010 % Share 43.2% 31.3% 24.9% 0.7% 100% DATAMONITOR

Figure 3:

Global casinos & gaming sector segmentation II: % share, by value, 2010

Source: Datamonitor

DATAMONITOR

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FIVE FORCES ANALYSIS

FIVE FORCES ANALYSISThe casinos & gaming market will be analyzed taking casino and gaming operators as players. The key buyers will be taken as consumers, and gambling equipment and service providers as the key suppliers.

SummaryFigure 4: Forces driving competition in the global casinos & gaming sector, 2010

Source: Datamonitor

DATAMONITOR

The casinos and gaming sector is subject to huge regional variation with some countries outlawing it completely and others imposing very little regulation. The casinos and gaming sector consists of all forms of betting (commercial, state-run and charitable operations), excluding online activities. The existence of addictive forms of gambling behavior indicates that some consumers are not making rational economic decisions and become dependent on gambling in their everyday lives. Such patterns are evident in many regions and weaken buyer power accordingly. On the other hand, the sector has been affected to some extent by the economic downturn, even though it has long been thought to be "recession-proof. Fewer buyers may lead to stronger buyer power. Within this sector, size matters and a handful of suppliers dominate. Participants benefit from regulatory barriers to entry, which make it difficult for new players to come in and steal market share. The recent economic downturn is affecting the casino and gaming sector in many countries and the suppliers of slot machines, video poker, lotteries and other games are suffering as a result. Almost any leisure activity can act as a substitute for casinos and gaming. However, the rapid growth of online gaming in certain countries, most notably the UK, represents a significant threat to the traditional sector. As a result, the threat fromGlobal - Casinos & Gaming Datamonitor. This profile is a licensed product and is not to be photocopied

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FIVE FORCES ANALYSIS

substitutes is assessed as very strong. National operators of gambling facilities are protected by restrictions placed upon international operators who wish to enter the sector; thus limiting rivalry somewhat.

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FIVE FORCES ANALYSIS

Buyer powerFigure 5: Drivers of buyer power in the global casinos & gaming sector, 2010

Source: Datamonitor

DATAMONITOR

The popularity of different gambling activities across the world means that the number of buyers is large and, in many regions, still growing. For instance, Singapore, which dropped its 40 year long gambling ban in 2005, sees casinos as an important part of a broader effort to promote itself as a getaway for tourists and the first two casinos in the country opened in 2010. In the same year, Macau overtook the Las Vegas Strip as the worlds Number 1 gaming market, proof of the sectors new-found global appeal. The wide availability of potential customers weakens buyer power in this sector considerably. Activities within this sector are non-essential leisure activities. Consequently, it would be expected that such activities are not vital to buyers. However, this issue is complicated by gambling addictions. The existence of addictive gambling behavior indicates that some consumers are not making rational economic decisions and become dependent on gambling in their everyday lives. Such patterns are evident in many regions and weaken buyer power accordingly. On the other hand, the sector has been affected by the economic downturn, even though it has long been thought to be "recession-proof. Fewer buyers may lead to stronger buyer power. Market players can choose from a wide range of gaming activities such as lotteries, gaming machines, poker, black jack, sports betting etc. There are also several different methods of distribution (online, outlets, casinos etc.). There are also different win margins. Loyalty to a particular market player is unlikely to be high; although compulsory membership in many casinos can ensure that customers are retained. Switching costs for consumers vary according to the type of gambling. For example, many casinos require annual membership fees; thus constituting a switching cost should a

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FIVE FORCES ANALYSIS

consumer change to a different casino before the annual membership expires. Generally switching costs remain minimal, particularly in the case of high-street bookmakers. This strengthens buyer power. The growth of disposable income levels in some regions has increased buyer power further. Overall, there is a moderate degree of buyer power within the global casinos and gaming sector.

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FIVE FORCES ANALYSIS

Supplier powerFigure 6: Drivers of supplier power in the global casinos & gaming sector, 2010

Source: Datamonitor

DATAMONITOR

Inputs to the casino and gaming sector vary according to the player. Many casinos position themselves within the hospitality sector, where success largely depends on quality of service provided, and thus skilled employees are required. Location is important for such companies, for example, they may wish to locate in popular tourist resorts. Gaming machines and related equipment and services are also, of course, vital. Participants benefit from regulatory barriers to entry, making it difficult for new players to enter and steal market share. Companies that supply equipment, machinery or services may lack the name recognition of the larger casino operators, but their services and products are integral to the success and proper functioning of a casino. Large supplier companies such as International Game Technology (IGT), WMS Industries and Shuffle Master hold power as they produce top-of-the-range machines which consumers want to play. These suppliers have been joined by others, including foreign firms entering new markets. Larger suppliers diversify geographically to guard against over-dependence on just one particular market; however, most manufacturers of gaming machines tend to specialize in this sector. Since the gaming industry is highly important to their survival, this weakens supplier power. The recent economic downturn has negatively impacted the sector and suppliers are being dragged along for an unwelcome ride. When casinos do well, they replace and repair games more often; when casinos slump, they do not move as quickly in making replacements. However, there is still some opportunity in some areas for expansion into new forms of gambling. Overall, supplier power is moderate.

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FIVE FORCES ANALYSIS

New entrantsFigure 7: Factors influencing the likelihood of new entrants in the global casinos & gaming sector, 2010

Source: Datamonitor

DATAMONITOR

The casinos and gaming sector operates differently from country to country, according to regulatory and legislative barriers, which often reflect the cultural acceptance of gambling in a particular country. Historically, gambling has not been as widely accepted in Europe as in the US. Tax levies on market players in many European countries are higher than other parts of the world; consequently, many players may wish to operate in other geographies. In some German states, gambling taxes run as high as 92% of net income and make it difficult to survive even in times of economic prosperity. In Spain, the UK, France and Germany, casinos are at risk of closing without changes in local tax laws and regulations. In addition, there have been declines in revenue in some regions due to smoking bans in an increasing number of countries; a growing number of nearby competitors and slot arcades as more countries liberalize their gaming laws in combination with open borders and increased cross-border gambling. In Eastern Europe, casinos positioned along the border with Western Europe, such as those in the Czech Republic and Poland, benefit from the lower cost of local staff and Western money flows well across borders. The situation looks different within Asia-Pacific sectors. For example, gambling in Mainland China is illegal. It is only in recent years that many ordinary Chinese people have been permitted to visit Macau, where gambling is legal. As such, the area is booming and is often described as Asias Las Vegas. In mainland China, the lottery constitutes a lucrative form of government-sanctioned gaming. The Ministry of Finance reports that China's total lottery sales revenue has been enjoying rapid growth. The laws in Japan do notGlobal - Casinos & Gaming Datamonitor. This profile is a licensed product and is not to be photocopied

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FIVE FORCES ANALYSIS

allow any form of casinos, although there is discussion underway (Q1 2011) to change this, as the government has identified it as a potentially lucrative source of tax and tourism revenue. The only gambling activities currently allowed are horse racing, pachinko parlors, and state lotteries. At present, pachinko (a pinball game) are substitutes for gambling in casinos. This game skirts Japans gambling ban because players exchange prizes for cash outside pachinko parlors themselves. Entering the casino sector in India may also be hampered as it is limited to two relatively small states: Goa and Sikkim. Other than lotteries, legal gambling in India is limited to betting on horse racing. Whilst several casinos exist in South Korea, the government plans to limit the total annual revenue of the gambling industry (including horse racing, lottery tickets and casinos) to 0.58% of its GDP, thereby discouraging new entrants. Despite the global downturn, industry growth for Australias casino sector should remain relatively stable in the next few years. Singapore lifted a 40-year ban on casinos in 2005. The $3.2 billion Marina Bay Sands casino opened in 2010, along with Gentings $3.1 billion Resorts World Casino. The outlying islands of Taiwan will now be open to legal land-based gambling. However, its mainland will remain inaccessible to companies such as MGM Grand and Las Vegas Sands. Recently, laws in many countries have been relaxed as governments see gambling as a potential source of income that could contribute towards fighting the global economic crisis. A new company wishing to enter this market would require fairly large amounts of capital to set up casinos, employ staff and acquire gaming equipment. However, the willingness of customers to switch from one gaming company to another and easy access to suppliers are conducive to the entry of new players. The likelihood of new entrants remains moderate overall.

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FIVE FORCES ANALYSIS

SubstitutesFigure 8: Factors influencing the threat of substitutes in the global casinos & gaming sector, 2010

Source: Datamonitor

DATAMONITOR

For the casinos and gaming sector as a whole, almost any leisure activity can act as a substitute, which can be taken up with minimal switching costs and may also be cheaper than gaming for consumers. Aside from cost advantages, some customers may value social aspects of using non-gambling forms of gaming facilities. For those wishing to engage in an activity which offers the possibility of winning money, online gambling is an option. This is particularly evident in the UK. The threat of substitutes in this sector is very strong.

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FIVE FORCES ANALYSIS

RivalryFigure 9: Drivers of degree of rivalry in the global casinos & gaming sector, 2010

Source: Datamonitor

DATAMONITOR

Generally the casinos and gaming sector within the global market remains highly fragmented and intensely competitive. However, in some countries it may be dominated by a few large entities in specific segments like horse race betting, or state-owned lottery monopolies. Additionally, high fixed costs and exit barriers (as many of the major tangible assets are highly specific to their industry, and thus harder to divest) make competition even stronger. Healthy market growth in the global casinos and gaming sector may attract newcomers, however the high rates of taxation (particularly in Europe) mean that it is more difficult to stay profitable. For many players, gaming is their sole or principal activity; so it is vital that they maintain their gaming revenues. Some companies, however, have a more diverse offering; which weakens rivalry somewhat. For example, casinos may be incorporated into a more general leisure facility, such as a hotel. Some state lotteries are single-state while others have multi-state range. Multi-state lotteries generally have larger jackpots due to the greater number of tickets sold. Market players have the possibility to differentiate their offerings by additional services such as more or less sophisticated entertainment (concerts, special events), reward programs, tournaments, or non-gaming facilities (restaurants, arcades, spas). Cultural acceptance and gaming formats differ in particular countries. In the US, sports betting, casinos and machines are the prevalent gambling formats, while in Japan, pachinko machines dominate as casino gambling is illegal. In Europe, lotteries remain the dominant revenue source for the industry. Overall, rivalry within this sector is assessed as moderate.

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LEADING COMPANIES

LEADING COMPANIESHarrah's Entertainment, Inc.Table 4: Harrah's Entertainment, Inc.: key facts One Caesars Palace Drive, Las Vegas, Nevada 89109, USA 1 702 407 6000 1 702 407 6037 www.harrahs.com December DATAMONITOR

Head office: Telephone: Fax: Website: Financial year-end: Source: company website

Harrah's is one of the largest casino entertainment providers in the world. It conducts its business primarily through its wholly owned subsidiary, Harrah's Operating Company and other related subsidiaries. The company offers its services under Harrah's, Caesars and Horseshoe brand names. The company's operations includes land-based casinos, casino clubs, riverboat or dockside casinos, casinos on Indian reservations, a combination greyhound racing facility and casino, and combination thoroughbred racetrack and a harness racetrack and casino. In addition to casinos, Harrah's facilities include hotel and convention space, restaurants and non-gaming entertainment facilities. The company operates and manages 52 casinos in seven countries, but primarily in the US and the UK. The company's facilities have an aggregate of approximately three million square feet of casino gaming space and approximately 39,000 hotel rooms. Harrah's has a customer loyalty program, Total Rewards, which has over 40 million members. The company generates its revenues through five business operations: casino, food and beverage, rooms, management fees, and others. The company views each property as an operating segment and in turn aggregates and presents its operations as one reportable segment. In southern Nevada, the company operates a number of properties including Harrah's Las Vegas, Rio AllSuite Hotel & Casino, Caesars Palace, Bally's Las Vegas, Flamingo Las Vegas, Paris Las Vegas, Imperial Palace Hotel & Casino and Bill's Gamblin' Hall & Saloon. Harrah's Laughlin is located near both the Arizona and California borders and draws customers primarily from the southern California and Phoenix metropolitan areas. In northern Nevada, the company's properties include Harrah's Lake Tahoe, Harveys Resort & Casino and Bill's Casino, which are located near Lake Tahoe; and Harrah's Reno, located in downtown Reno. Additionally, the company caters to a wide base of customers from the Philadelphia metropolitan area,Global - Casinos & Gaming Datamonitor. This profile is a licensed product and is not to be photocopied

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LEADING COMPANIES

New York and New Jersey through Atlantic City casinos, Harrah's Atlantic City, Showboat Atlantic City, Caesars Atlantic City and Bally's Atlantic City properties. Harrah's Chester is a combination harness racetrack and slot facility which draws customers primarily from the Philadelphia metropolitan area and Delaware. In southern Indiana, the company operates Horseshoe Southern Indiana (formerly Caesars Indiana), a dockside casino complex located in Elizabeth, Indiana. In Louisiana, the company owns Harrah's New Orleans, a land-based casino located in downtown New Orleans. In northwest Louisiana, Horseshoe Bossier City, a dockside casino, and Harrah's Louisiana Downs, a thoroughbred racetrack with slot machines, located in Bossier City, cater to customers in northwestern Louisiana and east Texas, including the Dallas/Fort Worth metropolitan area. The company's other properties include Grand Casino Biloxi, located in Biloxi, Mississippi, Harrah's North Kansas City, and Harrah's St. Louis, Harrah's Metropolis, a dockside casino located in Metropolis, Illinois, and Horseshoe Tunica, Harrah's Tunica and Tunica Roadhouse Hotel & Casino (formerly Sheraton Casino & Hotel Tunica), dockside casino complexes located in Tunica, Mississippi. Horseshoe Council Bluffs, a land-based casino, and Harrah's Council Bluffs, a dockside casino facility, are located in Council Bluffs, Iowa, Nebraska. At Bluffs Run, the company owns the assets other than gaming equipment, and leases these assets to the Iowa West Racing Association (IWRA), a nonprofit corporation. In the UK, the company owns or manages four casinos in London: the Sportsman, the Golden Nugget, the Rendezvous and The Casino at the Empire. Additionally, it owns Alea Nottingham, Alea Glasgow, Manchester235, Rendezvous Brighton and Rendezvous Southend-on-Sea. The company's properties in Egypt include The London Club Cairo and Caesars Cairo. It operates in South Africa through the Emerald Safari. The company also earns fees by managing three casinos for Indian tribes, which include Harrah's Phoenix AkChin, Harrah's Cherokee Casino and Hotel, and Harrah's Rincon Casino and Resort. Additionally, the company owns and operates Bluegrass Downs, a harness racetrack, located in Paducah, Kentucky, and owns 50% of Turfway Park LLC, the owner of the Turfway Park thoroughbred racetrack in Boone County, Kentucky. Turfway Park LLC owns a minority interest in Kentucky Downs LLC, the owner of the Kentucky Downs racetrack located in Simpson County, Kentucky.

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LEADING COMPANIES

Key Metrics The company recorded revenues of $10,127 million in the fiscal year ending December 2008, a decrease of 6.4% compared to fiscal 2007. Its net loss was $5,197 million in fiscal 2008, compared to a net income of $619 million in the preceding year. More recent financial information was not available for this company at the time of publication.

Table 5: $ million

Harrah's Entertainment, Inc.: key financials ($) 2004 4,396.8 367.7 8,585.6 46,600 2005 7,010.0 236.4 20,517.6 14,820.9 85,000 2006 9,673.9 535.8 22,284.9 16,161.4 85,000 2007 10,825.2 619.4 23,357.7 16,730.8 87,000 2008 10,127.0 (5,197.2) 31,048.6 32,459.0 80,000

Revenues Net income (loss) Total assets Total liabilities Employees Source: company filings

DATAMONITOR

Table 6: Ratio

Harrah's Entertainment, Inc.: key financial ratios 2004 8.4% 15.5% 30.5% 30.5% 4.8% $94,352 $7,891 2005 3.4% 59.4% 139.0% 72.6% 72.2% 1.6% $82,471 $2,781 2006 5.5% 38.0% 8.6% 9.0% 72.5% 2.5% $113,811 $6,304 2007 5.7% 11.9% 4.8% 3.5% 71.6% 2.7% $124,428 $7,120 2008 (51.3%) (6.4%) 32.9% 94.0% 104.5% (19.1%) $126,588 ($64,965)

Profit margin Revenue growth Asset growth Liabilities growth Debt/asset ratio Return on assets Revenue per employee Profit per employee Source: company filings

DATAMONITOR

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LEADING COMPANIES

Figure 10: Harrah's Entertainment, Inc.: revenues & profitability

Source: company filings

DATAMONITOR

Figure 11: Harrah's Entertainment, Inc.: assets & liabilities

Source: company filings

DATAMONITOR

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LEADING COMPANIES

Las Vegas Sands Corp.Table 7: Las Vegas Sands Corp.: key facts 3355 Las Vegas Boulevard, South Las Vegas, Nevada 89109 USA 1 702 414 1000 1 702 414 4884 www.lasvegassands.com December LVS New York DATAMONITOR

Head office: Telephone: Fax: Website: Financial year-end: Ticker: Stock exchange: Source: company website

Las Vegas Sands (LVSC or "the company") operates in the hotel, gaming, and resort development business. The company owns and operates the Venetian Casino Resort and the Sands Expo and Convention Center in Las Vegas, Nevada, and the Sands Macao Casino in Macau, China. LVSC, through its subsidiaries, operates in the US, the UK, India, Japan, South Korea, Hong Kong, China, Malaysia, Singapore, and other countries. The company primarily operates in three geographic areas: Las Vegas, Macao, and Singapore. In Las Vegas, The Venetian Las Vegas operations consists of amenities for its guests such as a Paiza Club, which offers high-end services and amenities to customers, including spas and private gaming rooms; a Canyon Ranch SpaClub, operated by Canyon Ranch; and a theater/entertainment complex. The casino at The Venetian Las Vegas has approximately 120,000 square feet of gaming space including approximately 115 table games and 1,610 slot machines. The Venetian Las Vegas operations include the Sands Expo Center and The Palazzo. The company's Sands Expo Center, The Sands Expo and Convention Center, owns approximately 1.2 million gross square feet of exhibit and meeting space. The Palazzo operations include an integrated resort with about 7,100 suites and 105,000 square feet of gaming space, which includes about 125 table games and 1,410 slot machines. The company's Macao operations consist of the Sands Macao, The Venetian Macao, and Four Seasons Macao, and other ancillary operations.

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LEADING COMPANIES

LVSC owns and operates the Sands Macao, the first Las Vegas-style casino in Macao, which includes about 229,000 square feet of gaming space and has about 420 table games and 1,170 slot machines or similar electronic gaming devices. It also includes a 289-suite hotel tower, several restaurants, a spacious Paiza Club, a theater and other high-end services and amenities. The Venetian Macao, the anchor property for the company's Cotai Strip development, includes about 550,000 square feet of gaming space and has approximately 600 table games and 2,200 slot machines or similar electronic gaming devices, and a designed capacity of approximately 1,150 table games and 7,000 slot machines or similar electronic gaming devices. The Four Seasons Macao consists of 360 rooms and suites managed by Four Seasons Hotels Inc, a subsidiary of the company; approximately 70,000 square feet of gaming space with approximately 120 table games and 200 slot machines or similar electronic gaming devices; several food and beverage offerings; conference and banquet facilities; and retail space of approximately 211,000 square feet, which is connected to the mall at The Venetian Macao. The company operates a Marina Bay Sands in Singapore. It includes 2560 hotel rooms, parts of the shopping mall and convention center, some restaurants and bars, the Event Plaza along Marina Bay, and the casino. The company's subsidiaries include Asian Cultural & Recreational Promotion (I) Co., Limited, Beijing Adelson Hotel Management Co., Ltd, Bethlehem Works Owners Association, LLC, Cotai Waterjets (Macau) Limited, Grand Canal Shops Mall MM Subsidiary Inc, Las Vegas Sands (Ibrox) Limited, Las Vegas Sands LLC, Lido Intermediate Holding Company LLC, LVS International (Malaysia) Sdn. Bhd, LVS International (Singapore) Pte. Ltd, LVS International (South Korea) Limited, LVS International (Taiwan) Limited, LVS International Japan Ltd, and others. Key Metrics The company recorded revenues of $4,390 million in the fiscal year ending December 2008, an increase of 48.8% compared to fiscal 2007. Its net loss was $189 million in fiscal 2008, compared to a net income of $117 million in the preceding year. More recent financial information was not available for this company at the time of publication.

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LEADING COMPANIES

Table 8: $ million

Las Vegas Sands Corp.: key financials ($) 2004 1,197.1 495.4 3,601.5 2,285.5 10,400 2005 1,740.9 283.7 3,879.7 2,270.2 12,230 2006 2,236.9 442.0 7,126.5 5,051.3 15,280 2007 2,950.6 116.7 11,466.5 9,206.2 28,000 2008 4,389.9 (188.8) 17,144.1 12,403.7 28,500

Revenues Net income (loss) Total assets Total liabilities Employees Source: company filings

DATAMONITOR

Table 9: Ratio

Las Vegas Sands Corp.: key financial ratios 2004 41.4% 73.0% 87.9% 30.2% 63.5% 18.0% $115,106 $47,635 2005 16.3% 45.4% 7.7% (0.7%) 58.5% 7.6% $142,347 $23,197 2006 19.8% 28.5% 83.7% 122.5% 70.9% 8.0% $146,394 $28,927 2007 4.0% 31.9% 60.9% 82.3% 80.3% 1.3% $105,379 $4,168 2008 (4.3%) 48.8% 49.5% 34.7% 72.3% (1.3%) $154,033 ($6,623)

Profit margin Revenue growth Asset growth Liabilities growth Debt/asset ratio Return on assets Revenue per employee Profit per employee Source: company filings

DATAMONITOR

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LEADING COMPANIES

Figure 12: Las Vegas Sands Corp.: revenues & profitability

Source: company filings

DATAMONITOR

Figure 13: Las Vegas Sands Corp.: assets & liabilities

Source: company filings

DATAMONITOR

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LEADING COMPANIES

MGM Resorts InternationalTable 10: MGM Resorts International: key facts 3600 Las Vegas Boulevard South, Las Vegas, Nevada 89109, USA 1 702 693 7120 1 702 693 8626 www.mgmmirage.com December MGM New York DATAMONITOR

Head office: Telephone: Fax: Website: Financial year-end: Ticker: Stock exchange: Source: company website

MGM Resorts International (MGM Resorts or 'the company') is one of the leading global hospitality companies, operating a strong portfolio of destination resort brands. The company has significant holdings in gaming, hospitality and entertainment business. The company's business primarily revolves around ownership and operation of casino resorts and it generates revenue under six reportable categories: casino, rooms, food and beverages, entertainment, retail and others. MGM Resorts owns and operate 15 wholly-owned casino resorts. The company has also made 50% investment in five other casino resorts. Some of the casino resorts owned and operated by MGM Resorts include Bellagio, MGM Grand Las Vegas, Mandalay Bay, The Mirage, Luxor, New York-New York, Excalibur, Circus Circus Reno and Silver Legacy among others. In addition to this, MGM Resorts also has a 50% investment in Silver Legacy in Reno. The company also owns 50% interest in CityCenter. The other 50% of interest in CityCenter is owned by Infinity World Development Corp, a wholly owned subsidiary of Dubai World, a United Arab Emirates government decree entity. Through its hospitality management subsidiary, MGM Resorts also holds a number of development and management agreements for casino and non-casino resort projects globally. The company also owns Shadow Creek, an exclusive golf course located approximately ten miles north of its Las Vegas Strip resorts, and Primm Valley Golf Club at the California/Nevada state line. Additionally, MGM Resorts and its local partners own and operate MGM Grand Detroit in Detroit, Michigan. It also owns and operates two resorts in Mississippi: Beau Rivage in Biloxi and Gold Strike Tunica.Global - Casinos & Gaming Datamonitor. This profile is a licensed product and is not to be photocopied

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LEADING COMPANIES

The international operations of the company include MGM Macau and MGM Hospitality. MGM Macau is a 35-story hotel tower with 600 appointed rooms, suites and villas, casino and private gaming salons. The resort operates a convertible convention area with 14,455-square-feet of meeting space, world-class spa, swimming pool facilities and a variety of restaurants. MGM Hospitality is a restaurant which offers gaming, hospitality and entertainment facilities. Key Metrics The company recorded revenues of $6,019 million in the fiscal year ending December 2010, an increase of .7% compared to fiscal 2009. Its net loss was $1,437 million in fiscal 2010, compared to a net loss of $1,292 million in the preceding year.

Table 11: $ million

MGM Resorts International: key financials ($) 2006 7,176.0 648.3 22,146.2 18,296.7 56,800 2007 7,691.6 1,584.4 22,727.7 16,667.0 54,700 2008 7,208.8 (855.3) 23,274.7 19,300.4 46,000 2009 5,978.6 (1,291.7) 22,518.2 18,647.8 46,000 2010 6,019.2 (1,437.4) 18,896.3 15,897.7 45,000

Revenues Net income (loss) Total assets Total liabilities Employees Source: company filings

DATAMONITOR

Table 12: Ratio

MGM Resorts International: key financial ratios 2006 9.0% 10.7% 7.0% 4.8% 82.6% 3.0% $126,337 $11,413 2007 20.6% 7.2% 2.6% (8.9%) 73.3% 7.1% $140,615 $28,966 2008 (11.9%) (6.3%) 2.4% 15.8% 82.9% (3.7%) $156,712 ($18,593) 2009 (21.6%) (17.1%) (3.3%) (3.4%) 82.8% (5.6%) $129,969 ($28,080) 2010 (23.9%) 0.7% (16.1%) (14.7%) 84.1% (6.9%) $133,761 ($31,942)

Profit margin Revenue growth Asset growth Liabilities growth Debt/asset ratio Return on assets Revenue per employee Profit per employee Source: company filings

DATAMONITOR

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LEADING COMPANIES

Figure 14: MGM Resorts International: revenues & profitability

Source: company filings

DATAMONITOR

Figure 15: MGM Resorts International: assets & liabilities

Source: company filings

DATAMONITOR

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LEADING COMPANIES

New York State LotteryTable 13: New York State Lottery: key facts One Broadway Center, Schenectady, NewYork 12301-7500, USA 1 518 388 3300 1 518 388 3403 www.nylottery.org March DATAMONITOR

Head office: Telephone: Fax: Website: Financial year-end: Source: company website

New York State Lottery is a government-owned lottery business based in Schenectady, New York. It sells tickets through more than 15,000 retailers and 14,000 online terminals (maintained by GTECH Holdings). Around 50% of sales are paid out as prizes and almost 40% go to education programs. The New York Lottery offers the games such as Lotto, Take Five, Numbers, Win 4, Quick Draw, and Lottery Instant Games. Lotto is the basic lottery game where customers buy a lotto ticket for $1 for two game panels, or play up to $5 on the 10-playcard. They then wait until the numbers are drawn to see if they have won a cash prize. Jackpot winners who match six numbers out of a possible 59 can choose whether they are paid in 26 yearly payments or a one off payment. Take Five involves picking five numbers from a possible 39 for $1 or players can play up to $5 on the 5game playcard, and this is again drawn on a certain day with the jackpot going to the person who matches five numbers. Numbers is a daily game that involves wagering $0.5 or $1 on your three numbers being drawn in a certain combination, while Win 4 is the same as Numbers but with higher odds and a larger pay out. Quick Draw involves choosing how many spots (numbers) the player wants to play on a Quick Draw playcard. They then pick up to 10 numbers from the field of 1 through 80. Every four minutes the Lottery's computer randomly selects 20 numbers from the field of one through 80 and displays them on the Quick Draw monitor. The player wins based on how many numbers they match. New York State Lottery donates more than 33% of its revenues as aid to education. The lottery also supports the Empire State Games.

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LEADING COMPANIES

Key Metrics The company recorded revenues of $7,660.1 million during the financial year (FY) ended March 2009, an increase of 1.5% over FY2008. The operating profit of the company was $2,500.1 million during FY2009, a decrease of 3.1% over FY2008. The net profit was $2,548.2 million in FY2009, a decrease of 3.5% over FY2008. More recent financials are not available.

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MARKET FORECASTS

MARKET FORECASTSMarket value forecastIn 2015, the global casinos & gaming sector is forecast to have a value of $512.9 billion, an increase of 34.3% since 2010. The compound annual growth rate of the sector in the period 201015 is predicted to be 6.1%. Table 14: Year 2010 2011 2012 2013 2014 2015 CAGR: 201015 Source: Datamonitor Global casinos & gaming sector value forecast: $ billion, 201015 $ billion 381.8 393.7 419.8 449.2 479.3 512.9 billion 287.5 296.5 316.1 338.3 360.9 386.2 % Growth 7.5% 3.1% 6.6% 7.0% 6.7% 7.0% 6.1% DATAMONITOR

Figure 16: Global casinos & gaming sector value forecast: $ billion, 201015

Source: Datamonitor

DATAMONITOR

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APPENDIX

APPENDIXMethodologyDatamonitor Industry Profiles draw on extensive primary and secondary research, all aggregated, analyzed, cross-checked and presented in a consistent and accessible style. Review of in-house databases Created using 250,000+ industry interviews and consumer surveys and supported by analysis from industry experts using highly complex modeling & forecasting tools, Datamonitors in-house databases provide the foundation for all related industry profiles Preparatory research We also maintain extensive in-house databases of news, analyst commentary, company profiles and macroeconomic & demographic information, which enable our researchers to build an accurate market overview Definitions Market definitions are standardized to allow comparison from country to country. The parameters of each definition are carefully reviewed at the start of the research process to ensure they match the requirements of both the market and our clients Extensive secondary research activities ensure we are always fully up-to-date with the latest industry events and trends Datamonitor aggregates and analyzes a number of secondary information sources, including: National/Governmental statistics International data (official international sources) National and International trade associations Broker and analyst reports Company Annual Reports Business information libraries and databases

Modeling & forecasting tools Datamonitor has developed powerful tools that allow quantitative and qualitative data to be combined with related macroeconomic and demographic drivers to create market models and forecasts, which can then be refined according to specific competitive, regulatory and demand-related factors Continuous quality control ensures that our processes and profiles remain focused, accurate and up-to-date

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APPENDIX

Industry associationsAmerican Gaming Association 1299 Pennsylvania Ave., NW, Suite 1175, Washington, D.C. 20004, USA Tel.: 001 202 552 2675 Fax: 001 202 552 2676 www.americangaming.org Asia Pacific Lottery Association (APLA) 74 Walters Drive, Osborne Park, Western Australia 6017 Tel.: 0061 8 9340 5371 Fax: 0061 8 9443 1464 www.asiapacific-lotteries.com European Lotteries and Toto Association The Secretary-General, Av. Bthusy 36, 1005 Lausanne Tel.: 0041 21 311 30 25 Fax: 41 21 312 30 11 https://www.european-lotteries.org International Association of Gaming Regulators (IAGR) www.iagr.org World Lottery Association Lange Gasse 20, CH-4002 Basel, Switzerland Tel.: 0041 61 284 1111 Fax: 0041 61 284 1350 www.world-lotteries.org

Related Datamonitor researchIndustry Profile Casinos & Gaming in the United States Casinos & Gaming in Asia-Pacific Casinos & Gaming in Europe Casinos & Gaming in the United Kingdom

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APPENDIX

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APPENDIX

DisclaimerAll Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, Datamonitor plc. The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the findings, conclusions and recommendations that Datamonitor delivers will be based on information gathered in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As such Datamonitor can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

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