Casino Association reports first decrease in gambling revenue in 20 years
The Casino Association of SA (Casa), which represents the legal casino gaming industry‚ has signalled that the economic downturn is emptying the pockets of punters.
Its 12th annual survey of the South African casino industry showed that‚ for the first time since the inception of the casino industry in SA under the new democratic dispensation‚ there was a decrease in revenue.
Casa members generated gross gambling revenue of R17.8bn in the year to March 2017‚ down 1.8% from R18.2bn in the previous year‚ "due to current economic conditions negatively impacting consumers’ disposable income and revenue erosion from illegal gambling".
Gauteng remains the largest contributor to gross revenue with R7.363bn — but this is down 1.6% compared to last year.
The biggest growth in gross gambling revenue was experienced in Western Cape — up 5.3%.
The biggest loss was experienced in the North West — down 22.1%. Casa blamed this on the government’s decision in 2016 to allocate an additional casino licence in the province. It said there was no reasonable justification for this decision and that legal proceedings were ongoing.
Elaborating on the findings‚ Casa chairperson Jabu Mabuza said: "What emerges is a picture of an industry that‚ although displaying strengths in certain key areas‚ is undeniably facing a number of challenges. Some of these are beyond our control: for instance‚ the 1.8% drop in gross gambling revenue — a trend that sees the first regression in casino gambling revenue since the inception of the casino industry in 1997 – is primarily attributed to the erosion of gambling revenue by illegal gambling operators, especially illegal online gambling operations, which continue to grow unabated.
"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 authorities to implement "a deliberate and concerted law-enforcement effort to address illegal gambling in SA".
The government gets a big chunk of cash from the industry.
Mabuza said Casa members generated R16.5bn of value from their activities in 2017 after taking into account amounts paid out to suppliers, which amounted to R5.8bn. Of the R16.5bn generated‚ R3.5bn (21%) was distributed to employees, while R5.9bn (36%) went to local‚ provincial and national governments in the form of various taxes and levies. "These two stakeholders received 57% of the value generated‚ up by 1.0% compared to the previous year‚" Mabuza said.
Casa members invested R1.96bn in capital expenditure on their casino complexes during the year under review; an amount equalling 11% of gross gambling revenue.
The total corporate social investment contribution was down 6.4% or R10.6m in 2017 year due to the decrease in gambling revenue‚ he said. Despite the decrease‚ the survey showed Casa members still spent R155m on initiatives in focus areas such as responsible gambling‚ education‚ health‚ sports‚ arts and culture‚ and the environment.