MASHANTUCKET and UNCASVILLE, Conn. - Despite recent declines in casino revenues, leaders at Mohegan Sun and Foxwoods Resort Casino have a sunny outlook. The country;s two largest Indian gaming facilities will weather the current economic storm, Mohegan Chairman Bruce ''Two Dogs'' Bozsum and Foxwoods interim President Barry Cregan said.
Combined gaming revenue for the Mohegan Sun and Foxwoods, which is owned by the Mashantucket Pequot Tribal Nation, was $2.532 billion in 2007. That amount was up 1.6 percent from around $2.493 billion in 2006.
Regardless of the slower growth rate, the casinos continue to grow and are so successful that they represent the second highest grossing Indian gaming state in the country after California, according to Casino City's latest Indian Gaming Industry Report by Alan Meister, an economist with Analysis Group in Los Angeles. Revenues from the two Connecticut casinos together made up almost 10 percent of the nationwide $26.5 billion in Indian gaming revenues last year.
But the casinos have seen decreases in their monthly revenues during the past several months, and on Aug. 21, Moody's Investors Service placed both the Mohegan Tribal Gaming Authority and the MPTN on review for a possible downgrade in their ratings because of declines in slot revenues over the last three quarters.
''The weak economy and increased competition in the Northeast U.S. are believed to be largely responsible for these declines,'' Moody's said.
Both facilities reported declines in slot revenues for July.
Foxwoods reported a net slot win of $72.8 million, a 3.2 percent decline from July 2007. That number was up, however, from the $63.6 million win in June 2008.
Mohegan Sun reported a slot win in July of $75.9 million, a decrease of 14.6 percent from previous year, but up from June's win of $67.8 million.
The Mashantucket Pequots opened a new facility, MGM Grand at Foxwoods, three months ago which provided a bounce in May revenues.
''Everybody's going through this (slowdown) right now. We're still very positive. We do have the best product in the world and our non-gaming revenues during the last quarter went up 17 percent, which is pretty amazing considering what's going on in the rest of the country. People come here because it's a one-of-a-kind world class place,'' Bozsum told Indian Country Today.
Foxwoods and other gaming enterprises around the country are being challenged by the current economic slowdown, Cregan said in a prepared statement that echoed Bozsum's sentiments.
''Gas prices continue to impact the discretionary spending and the travel habits of our patron base, but with the addition of the MGM Grand at Foxwoods and strategic marketing initiatives we are implementing, Foxwoods and the MGM Grand at Foxwoods continue to be a destination of choice for the consumer. In fact, the properties offer a superior and cost-effective alternative to destinations such as Las Vegas, offering the same amenities that can be had at other locations, at a fraction of the travel costs. We remain optimistic that we will ride out the current economic difficulties and remain a world-class gaming and entertainment destination,'' Cregan said.
Bozsum said the July bounce in revenues at Mohegan Sun was welcomed, ''but we didn't meet our goals because last year in July we had the record breaking month of a billion dollars. It was big news. So our expectations were a lot higher for this year. We didn't expect to make a billion, but we had some growth in there. We still made money, but we didn't meet the numbers we were hoping to meet,'' Bozsum said.
The Mohegan chairman agreed that the current economy is ''scary for the whole country,'' but the casino is holding its own, he said, and the tribe is moving forward with a $1 billion expansion plan, called Project Horizon.
The first phase of the plan: A new casino, called The Casino of the Wind, was scheduled to open Aug. 29. The full expansion, including a new hotel tower, restaurants, retail shops and entertainment venues, will roll out by 2010.
That the expansion was planned to unfold in phases was pure luck, considering the downturn in the economy, Bozsum said.
''If you look at the property, we couldn't do it all at once without much disruption, so we knew we had to do it in phases and it'll probably work out perfectly for when the economy turns around, we'll be opening in 2010,'' Bozsum said.
Bozsum said he didn't think the current economy would impact the tribe's ability to borrow.
''We secured everything before the economy took a downturn, so our banks are behind us and if we have to modify something, I'm sure the banks will be happy to work with us. We have great relationships with every bank that has ever worked with the Mohegans,'' Bozsum said.
Asked if he's positive about the future, Bozsum said, ''Yes. I am the optimist in everything. Always have been and always will be.''