iCrowdNewswire Jan 13, 2021 9:50 AM ET
Revenue at British Columbia’s biggest casinos was on the decline even prior to the pandemic according to new data from Business Intelligence for B.C. (BIV). The industry had been growing rapidly from 2015, peaking in 2018 before casinos started to record losses.
The COVID-19 didn’t help things obviously: Nearly all casinos closed for safety reasons, lending a blow to the already struggling industry. Before the pandemic, the biggest problem for casinos was dealing with losses from table games.
BIV estimates that B.C. casinos reported a 17.7% reduction in profits from table games between 2015 and 2019–$22 million from $26.7 million. Slots performed fairly better in the same period expect in 2019 when revenue from these games went down from $61.3 million to $60 million.
Overall losses for Casinos
As mentioned, B.C. casinos were already recording losses before the pandemic hit Canada. River Rock Casino Resort was the most impacted business, recording an 11.3% profit reduction in 2019, from $323.7 million in 2018 to $287.2 million in 2019.
Despite the general decline of profits in 2019, some casinos still managed to make profits. Cascades Casino Kamloops, for example, recorded a 29.7% growth rate in 2019, the highest growth rate for casinos in B.C. that year. Among the top five ranked establishments, Hard Rock had the biggest gain, an 8.1% growth from $131.5 million in 2018 to $142.1 million in 2019.
In all fairness, Hard Rock had recorded a significantly low amount of money in 2018, 18.3% less than the $160.8 million it made in 2017. Nonetheless, it earned profits in 2019 while most of its competitors were making losses.
Performance During the Pandemic
Many experts projected casinos in Canada would bounce back from their reduced income to perform well in 2020. That didn’t happen. Instead, many of them were forced to shut down to help fight a pandemic that would soon disrupt the world tremendously.
With shutdowns came mass layoffs for tens of thousands of casino workers. Closures also led to unimaginable losses for the businesses and reduced tax income for the government. Luckily, casino closures didn’t last long as a significant number of companies reopened between June and August.
The casinos opened on the condition of adhering to strict safety protocols. But some of these rules prevented the companies from maximizing their profits. For example, the casinos could only invite less than half of their capacities and all patrons had to observe social distancing.
In other words, 2020 was a terrible year for B.C. casinos even after the province allowed them to reopen. Fortunately, most of these businesses survived their financial struggles and will look forward to a better year in 2021.
Online Casinos—Canada’s New Favorite Way to Gamble?
Online casinos have been gaining popularity in Canada for the past five years. In fact, they’ve been credited as the reason why some B.C. casinos have been struggling financially. Does that make them the future of gambling in Canada?
The short answer is that it depends. The Federal Government showed no signs of legalizing online casinos at the national level. However, many provinces regular the industry in one way or another—permitting lotteries, poker, slots, or card games.
B.C. was the first province to legalize online gambling in the country after it passed a law allowing for the sale of lottery tickets online in 2004. Five years later, B.C. legislators permitted online poker before adding online casino games in 2010.
Countrywide, Manitoba, Alberta, Ontario, and Quebec are more states with legal gambling laws. To expound more, they permit the same betting options as British Columbia. In the East Coast, the Atlantic Lottery Corp is responsible for overseeing gambling operations in the Maritime Provinces. So far, it permits lotteries but not casino games.
The Issue of Offshore Casinos
Although several provinces permit online casinos, they restrict these websites from accepting customers located in different jurisdictions. They also feature fewer games, smaller limits and often lack bonuses. And perhaps that’s why there’s an influx of offshore online casinos in Canada.
Offshore casinos in Canada exist because there’s no legislation that prohibits them at the Federal Level. They can offer their slots and card games to Canadians unfettered. In turn, Canadians can play these games without facing legal problems.
The absence of online gambling legislation also means casino players in Canada aren’t obliged to pay taxes on their wins. So, whether you win the $15M or $20M won by two lucky Canucks in 2015 and 2018 respectively, you can spend the entire amount freely.
That said, the greyness of Canada’s online casino laws doesn’t mean offshore operators can bring their offices to B.C. or Ontario. The fact that the country’s laws don’t permit online casinos means they can’t open their business locally.
Some foreign casinos have struck deals with the Kahnawake Gaming Commission to place their servers at the Quebec-based agency. But that’s the closest they can get to operating inside Canada.
Online vs Land-Based Casinos in Canada—Revenues, Demographics, and Stats
Although online casinos re-growing popular in Canada, they have a long way before they topple their land-based counterparts. According to a study conducted last year, Canucks spend up to $4 billion gambling at offshore casinos every year.
As we mentioned, Canadians choose foreign casinos because they give out bonuses, have a wider variety of games, and payout consistently. Importantly, we’re talking about the best-rated online casinos in Canada, not just about any websites. Learn more at bestcasinositescanada.com.
By comparison, Canadians spend roughly $17 billion at home-based casinos. Men dominate the industry at 80% versus 20% of women. However, women play casino games mainly through their mobile devices (55%). When it comes to age, a majority of online casino players in Canada are over 35 years.
That’s not to say millennials don’t play casino games online. Although many of them prefer skill-based video games, there’s a significant number of young players at Canada’s online casinos (17%). Most of them prefer card games to slots. But that’s understandable—card games are closer to games of skills than slots.