IT'S ALL BACCARAT

Strip gaming revenues increased 33% and it was all Baccarat. Baccarat volume and win were up 131% and 255%, respectively, thanks to CNY and a lot of luck. Slot revenue declined 9%.

Owing to the timing of Chinese New Year (CNY) and good luck on the tables, the Strip posted a 33% YoY increase in gaming revenues in February 2010.  As we wrote about a few weeks ago, we thought growth would be positive but this is much better than expected.  Of the $141 million positive variance from last year, $82 million was driven by higher Baccarat drop which increased 131%.  Baccarat win increased 255% partly due to the higher drop and partly due to a higher hold percentage - the Baccarat tables held at a 17.0% clip versus 11.1% last year.  Normal hold percentage is 12-13%.  The good Baccarat luck contributed about $65 million to the variance.  Slot revenues actually declined for the month by 8.5% all due to lower hold percentage.  The table below breaks down the YoY variance in millions of dollars.

IT'S ALL BACCARAT - strip7

While the February numbers were outstanding, a little caution is in order.  Revenues were down 23% last year so the comp was easy.  CNY fell into February of this year versus January of last year which helped Baccarat volume.  Baccarat volume and hold percentage can be very volatile and no doubt the strength on the Strip is mirroring the VIP strength in Macau.  It is unclear how sustainable these volumes are.