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Atlantic City’s Borgata sees record online gambling growth amid pandemic

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Yahoo Finance’s Alexis Christoforous and Melonie Johnson, President of Borgata Hotel Casino & Spa, discuss the slate of the casino industry amid the coronavirus pandemic.

Video Transcript

ALEXIS CHRISTOFOROUS: The coronavirus pandemic has ravaged the leisure and hospitality industry, which lost about four million jobs last year alone. Atlantic City's Borgata Hotel and Casino is picking up the pieces. It reopened in July after a four month shutdown because of the pandemic. Joining me now is Borgata's president and COO, Melonie Johnson. And we should mention that Borgata by the way owned by MGM Resorts.

Melonie, so good to see you. And welcome to the show. I am curious what kinds of trends you're seeing in terms of hotel bookings and foot traffic at the Casino since you reopened months ago.

MELONIE JOHNSON: Well, actually things are tempered by the restrictions or the limitations that have been imposed by the state of New Jersey. So we're running at 25% occupancy. So we're adhering to all of the safety protocols. Business is not what it was pre pandemic. But the one thing we'd like to say is that with BetMGM, Borgata Online, and Poker Party, year over year, year to date, we've seen a 174% increase in the gross gaming revenues in those three ventures.

ALEXIS CHRISTOFOROUS: So what you're saying is what you may be losing in foot traffic, you're seeing those people move over to your online offerings. Is this the best year ever? Or was 2020 the best year ever for Borgata's online gambling ventures?

MELONIE JOHNSON: Yes, it is. It's proven to be very profitable for us. Of course, individuals we're born to be entertained. The option for a brick and mortar casino was taken away mid-March due to COVID-19. And our customers did have the option and the luxury of going online in the comfort of their own homes and playing.

ALEXIS CHRISTOFOROUS: What about the actual games happening there at the casino itself? I'm wondering if all the games are taking place? Because I would imagine with the social distancing restrictions, things like craps or poker games have become more challenging.

MELONIE JOHNSON: Everything is challenging right now under the restrictions that we've got, but we've become very creative. We have a seven point health and safety protocol that we created with scientists and medical experts. And that's utilized throughout the entire MGM Resorts International Enterprise.

On table games for instance, we've got polycarbonate barriers, we limited the number of gaming positions to ensure that our guests and our employees are safe, at craps we've got polycarbonate barriers, and I'm happy to say effective on October 21, 2020, we opened live poker with 30 live games, seven positions with polycarbonate barriers as well. And we've also increased our capacity. So at any point in time if we've got the demand, we can open up to 50 tables.

ALEXIS CHRISTOFOROUS: What do you think when you look ahead to post pandemic and you're strategizing? What do you think that the hotel and casino industry is going to look like, Melonie?

MELONIE JOHNSON: It's going to look very different because we've learned how to operate very differently throughout these tough times. We're going through a process right now where we're rolling out a program where there will be keyless entry to hotel rooms. So we won't have all of those touch points. We've got our safety protocols where our employees, the housekeepers, when they go into the rooms they have to wear their face mask, they've got to have gloves.

And also in between guests, we allow the rooms to have a cooling off period to let everything settle for at least 24 hours before we allow our employees to go in. So right now we're looking at this like we've never looked at it before. And with the industry, with safety, with health, protecting our employees, protecting our guests, we've got to make sure that we've done everything humanly possible to ensure that when a human being walks across our gaming floor, whether it be an employee or a guest, they feel safe.

ALEXIS CHRISTOFOROUS: What about the physical chips? I'm just curious. I mean is anything going to be different about that? Because we're going to be trying to limit how many things were all physically touching I would imagine for years to come when we're done with this pandemic.

MELONIE JOHNSON: At present, we've got a cleaning process. Every so often, the chips are being sanitized on the table games. And in particular, poker, we've got chips being removed from tables. And we have dedicated personnel that sits there and just literally sanitizes those chips before they go back into play.

ALEXIS CHRISTOFOROUS: What about international visitors to Borgata? I don't know what business was like pre pandemic. But have you seen that business pretty much dry up right now?

MELONIE JOHNSON: That business has dried up because of airfare. Not necessarily the pricing, but just the limitations on having people enter the state of New Jersey and having to self quarantine for 14 days. It's just not feasible to have that air traffic business coming in.

We're fortunate that we're located in an area of the country where we've got two large metropolitan areas, New York and Philadelphia. So when a customer wants that form of entertainment, they have the luxury of driving in versus booking a flight and trying to fly in. So that's advantageous for us.

ALEXIS CHRISTOFOROUS: I want to ask about your restaurants there. You've got lots of great restaurants. Wolfgang Puck has his restaurant there, Bobby Flay, among others. Are people coming in and dining indoors? What's that been like for you?

MELONIE JOHNSON: We initially opened on July 23 with outdoor dining, which was very challenging. But the team at Borgata, food and beverage, entertainment, audiovisual facilities, we had an extraordinarily, I think phenomenal outdoor experience, where we chose to open later than our competitors in Atlantic City because we wanted to make sure whatever offerings we provided to our guests on the exterior of the business represented our brand.

We had Amphora Gardens, we had an outdoor dining experience at The Water Club we had a food truck, and we also had Borgata Street Eats on the first floor of our self parking garage. But now that we're allowed to have a dining experience indoor, we're at 25% occupancy. And of course, there's 6 feet of social distancing. So it limits the number of reservations we can take on a nightly basis. But we've seen this be very profitable and good for the property as well as our guests. And we're providing a great Borgata experience indoor right now with limited capacity.

ALEXIS CHRISTOFOROUS: When do you expect things to get back to pre pandemic levels, your hotel bookings, and your foot traffic in the casinos?

MELONIE JOHNSON: Oh, God. I wish I had the crystal ball to give you an exact answer on that. But right now, we're hopeful, very hopeful, that once we can get individuals vaccinated and we get to a point when we have herd immunity, hopefully sometimes towards the latter part of this year, we can see things move to more of a normal experience at the property and within the community.

ALEXIS CHRISTOFOROUS: We are all hopeful for that. Melonie Johnson, president and COO of Borgata Hotel and Casino. Good luck to you.

MELONIE JOHNSON: Thank you so much.