CASINO

Economic crunch takes a bite out of South Africa casino profits

TAGs: CASA, South Africa

South African casinos are feeling the heat of the prevailing economic downturn as their revenue dries up this year.

Economic crunch takes a bite out of South Africa casino profitsQuoting the Casino Association of South Africa (CASA), the Sunday Times reported that the casino industry is experiencing a decrease in revenue “due to current economic conditions negatively impacting consumers’ disposable income and revenue erosion from illegal gambling.”

It was also the first recorded gross gaming revenue slide since South Africa built it casino industry.

CASA data showed that its members posted total revenue of R17.8 billion (US$1.30 billion) for the fiscal year of 2017, 1.8 percent lower than last year’s R18.2 billion ($1.33 billion).

Of all South Africa’s casino regions, CASA considered the North West the biggest loser. The government’s controversial decision to allow another casino in the province last year – now the subject of a lawsuit – sent the North West’s revenue plunging 22.1 percent.

Gauteng, considered to be the largest gross gaming contributor in South Africa, joins North West on the losing side with a 1.6 percent revenue drop.

South Africa’s silver lining can be found in Western Cape, as the region posted 5.3 percent revenue growth.

“What emerges is a picture of an industry that‚ although displaying strengths in certain key areas‚ is undeniably facing a number of challenges,” Dr. Jabu Mabuza, chairperson of CASA, explained. “Our current economic climate‚ has also had significant implications on how much money is available to consumers as disposable income and how they choose to spend it.”

Mabuza called on the government to stamp out illegal gambling activities in South Africa, reminding them that the gambling industry is a main contributor to government revenue.

Despite the revenue slump, CASA members continue to fulfill their obligations in areas such as responsible gambling‚ education‚ health‚ sports‚ arts and culture‚ and the environment. The group said they already spent a total of R155 million ($11.34 million) on these initiatives.

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