Chilean Casinos Show High Earnings
After a tumultuous time period, not only due to the COVID-19 pandemic but also to national protests in 2019, Chilean casinos are finally on the rise again. A new report from the Superintendencia de Casinos de Juego (SCJ), Chile’s casino regulating body, shows that the industry has contributed CLP$1.38 billion — or $1.8 million — for the month of June 2021.
Despite various challenges to Chile’s casino industry since 2019, a recent report shows promising profits as casinos reopen. ©Caio Silva/Unsplash
An uphill climb in Chile’s casino industry
This news comes despite the fact that only three of Chile’s 26 land-based casino sites were allowed to operate in June 2021, because of health and safety concerns related to the COVID-19 virus. The report also shares that these casinos were open for an average of 19 days each, which is a relatively short period of time.
The income reported is also impressive considering what a tough time the gambling industry has had in the country since 2019. Widespread and violent protesting against the government throughout that year resulted in a government-mandated shut down of all casinos, due to serious safety concerns.
Chile did not receive a break as the COVID-19 pandemic swept across Latin America in 2020. The Enjoy casino chain alone reported losses of $100 million USD in Q1 2020 as a direct result of pandemic shut downs. Though they planned to reopen, a reduced capacity of 50% created stagnant conditions for casinos across the country in general, and many struggled to recover.
This was in the midst of several controversial changes proposed by Chile’s casino authorities in the summer of 2020. The move would have made it difficult for existing license holders to renew, whereas the previous law would allow for a lenient renewal every fifteen years for established venues. Some casinos found the change unfair after having invested millions in new casino sites in Chile.
A closer look at the numbers
According to the SCJ report, a total of CLP$639.8 million from the tax contribution figure will be paid to community and regional governments that house the casinos themselves. A further CLP$607.8 million is designated to gambling VAT, while the remaining sum is allotted to income tax.
One of the Enjoy locations that previously struggled, Enjoy Antofagasta, saw the biggest turnaround. In this month it contributed CLP$189.6 million in tax to the regional government, and the same figure to a municipal tax. Its total contribution to all of the various tax requirements was CLP$815.9 million. This is likely because they were the only location that were able to stay open for the entire month of June.
This location in particular was able to reach a similar income to what was normal before the COVID-19 pandemic restrictions. That is a positive sign for how the Chilean casino industry may grow as restrictions ease in the coming months.
Following Enjoy Antofagasta was Dreams Punta Areanas as the second highest tax contributor. It was open for just 17 days of June, in its home of Magellan. Its total contribution was CLP$460.1 million for the time period.
Last but not least was Colchagua Casino, in O’Higgins, which was only able to operate for 9 days in June 2021. Its total contribution was CLP$106.9 million, CLP$6.4 million of which went to income tax, while CLP$49.0 million went to VAT.
The total gross gaming revenue (GGR) reported by these three Chilean casino sites was CLP$3.81 billion, a sizable sum considering that they generated just slightly more in the same time period in 2019. According to the SCJ, they managed to earn 81.8% of previous figures, despite reduced hours and capacity. With all of those factors taken into account, it calculated that these sites actually improved by 17.6% compared to May 2019.
A final interesting figure is the number of visitors and average spend. Visitors were less than usual, which was to be expected given the lingering threat of the virus and its variants. Still, each of their average spends increased by about 45% compared to June 2019. This is a positive sign that citizens are feeling more comfortable and higher casino returns are likely to continue into the near future.
