1. Gaming Revenue
Projections for
South-Central Kansas
Presentation to Lottery Gaming Facility Review Board
by Will Cummings / Cummings Associates
December 1, 2010
1

2. Will E. Cummings
Cummings Associates
2

3. Questions, Please!
- at any time -
3

4. Overview
 Methodology (in brief)
. . . Distance Matters . . .
 Projections:
Global Gaming / WinSpirit
Peninsula / Kansas Star
4

5. Methodology
 “Gravity Models”
 Residents
 “Near” Neighbors
 Traffic Intercept
 14-15,000 vehicles / day
5

6. Gravity Models – Overview
 Location
 Location
 Size
 Everything Else
6

7. Gravity Models – Overview
 Location
 Location
 Size
 Everything Else
7

8. “Everything Else” 1
 Micro-Access
 Spaciousness
 Slot Mix
 Fit & Finish
 Management
 Marketing / Player Rewards
8

9. “Everything Else” 2
 Hotel
 Structured Parking
 Variety of Dining Choices
 Retail
 Entertainment
 “Brand”
9

10. “Everything Else”
=
“Power Ratings”
10

11. 11
Exhibit A-13: Gaming-Device Spending Ratios in Major US Markets
(Total Annual Spending on Slots and/or VLTs Per "Distance-Adjusted" Adult in FY2010)
Northeastern Medium to Large Rural Markets
US Markets Midwest (+/-) Markets West & Midwest
Deadwood, SD $909 e
S Dakota Indian avg. (8) $873 e
Upstate Michigan avg. $840 e
Kansas Natives avg. $818 e
Mississippi / Louisiana $809 e
(average of MANY facilities)
Diamond Jo N'wood, IA $793
Iowa Natives average $784 e
Terribles Lakeside. IA $773
Upstate Wisconsin avg. $770 e
Emmetsburg, IA $765
Colorado (2) $762
Horseshoe / Bluffs Run, IA $749 Dodge City, KS $747
Dubuque Mystique, IA $743
Dubuque Diamond Jo, IA $741
Riverside, IA $740
Harrahs NKCMO $734 IOC Boonville, MO $735 o
Niagara (NY) casino $729 e Albuquerque, NM avg. $729 e IOC Marquette, IA $730 o
Ameristar Council Bluffs, IA $727
Other New Mexico avg. $718 e
Atlantic City, NJ avg. $719 Mt. Pleasant, MI $718 e
IOC Waterloo, IA $715 Wisconsin Dells $715 e
Argosy Riverside, MO $707
Midwest Standard +10%

12. 12
Iowa Natives average $784 e
Terribles Lakeside. IA $773
Upstate Wisconsin avg. $770 e
Emmetsburg, IA $765
Colorado (2) $762
Horseshoe / Bluffs Run, IA $749 Dodge City, KS $747
Dubuque Mystique, IA $743
Dubuque Diamond Jo, IA $741
Riverside, IA $740
Harrahs NKCMO $734 IOC Boonville, MO $735 o
Niagara (NY) casino $729 e Albuquerque, NM avg. $729 e IOC Marquette, IA $730 o
Ameristar Council Bluffs, IA $727
Other New Mexico avg. $718 e
Atlantic City, NJ avg. $719 Mt. Pleasant, MI $718 e
IOC Waterloo, IA $715 Wisconsin Dells $715 e
Argosy Riverside, MO $707
Ameristar KCMO $698
Michigan City, IN $694
Harrahs W St Louis $690
Harrahs Council Bluffs, IA $689
Prairie Meadows, IA $685
Mohegan Sun, CT $670 o Ameristar St Chas, MO $668
Jumers Rock Island, IL $668
Clinton, IA $668
Harrahs Joliet, IL $665 o
Belterra, Florence, IN $665
Argosy Sioux City, IA $664 o
St Jo MO $662 o Metropolis, IL/KY $663 o
Catfish Bend Burlington, IA $660
Salamanca, NY casino $656 e Mark Twain, MO $655 o
Foxwoods, CT $649 o East St Louis, IL (2 boats) $651 o
Dover Downs, DE $640 IOC Bettendorf, IA $640 o
Charles Town, WV $638
Tioga Downs, NY $636 Ameristar, E Chicago IN $631 o
Midwest Standard +10%
"Midwest Standard"

13. 13
Exhibit A-14: Gaming-Device "Power Ratings"
(Total Annual Spending versus benchmark of $700)
Northeastern Medium to Large Rural Markets
US Markets Midwest (+/-) Markets West & Midwest
Deadwood, SD 129.9
S Dakota Indian avg. (8) 124.7 e
Upstate Michigan avg. 120.0 e
Kansas Natives avg. 116.9 e
Mississippi / Louisiana 115.5
(average of MANY facilities) Diamond Jo Northwood, IA 113.3
Iowa Natives average 112.0 e
Terribles Lakeside. IA 110.4
Upstate Wisconsin avg. 110.0 e
Emmetsburg, IA 109.3
Colorado (2) 108.9
Horseshoe / Bluffs Run, IA 107.0 Dodge City, KS 106.7
Dubuque Mystique, IA 106.1
Dubuque Diamond Jo, IA 105.9
Riverside, IA 105.7
Harrahs NKCMO 104.9 IOC Boonville, MO 105.0 o
Niagara (NY) casino 104.1 e Albuquerque, NM avg. 104.2 e IOC Marquette, IA 104.3 o
Ameristar Council Bluffs, IA 103.9
Mt. Pleasant, MI 102.6 e
Atlantic City, NJ avg. 102.7 Other New Mexico avg. 102.5 e
IOC Waterloo, IA 102.1 Wisconsin Dells 102.1 e
Argosy Riverside, MO 101.0
Ameristar KCMO 99.7
Michigan City, IN 99.1
Harrahs W St Louis 98.6
Harrahs Council Bluffs, IA 98.4
Prairie Meadows, IA 97.9
Mohegan Sun, CT 95.7 o Ameristar St Chas, MO 95.4
Jumers Rock Island, IL 95.4
Clinton, IA 95.4
Midwest Standard +10%
"Midwest Standard"

14. 14
Exhibit 5: Projected Power Ratings, etc.
Peninsula / Kansas Star Global / WinSpirit
2012 2014 2016 Full Build 2012 2014 2016 Full Build
Slot Machines 1,310 1,500 2,000 2,000 1,300 1,550 1,800 2,000
Table Games (not inc. poker) 32 42 50 50 30 40 40 40
Total Gaming Positions ( " " ) 1,502 1,752 2,300 2,300 1,480 1,790 2,040 2,240
Baselines for Slots:
Midwest Standard 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
Distance from Major Population Center 1.00 1.00 1.00 1.00 9.00 9.00 9.00 9.00
Temporary Facility (if applicable) (5.00)
Bricks & Mortar $ / Gaming Position (in $100ks) 0.94 1.15 1.13 1.13 0.93 0.83 0.92 1.00
Casino Square Footage / Gaming Position (x .02) 0.59 0.54 0.55 0.55 0.99 0.86 0.89 0.92
Hotel Rooms / Gaming Position (x 2) 0.17 0.26 0.26 0.11 0.09 0.08 0.18
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Power Rating 97.52 102.86 102.94 102.94 111.02 110.78 110.89 111.10
"Reach" (miles before extra decline with distance) 120 200 200 200 200 200 200 200
Compare: Last year at this location 102.78 N/C
Note: 100 = "Midwest Standard" power rating. Latest major facilities in Iowa range from 102 to 107. Boot Hill today = 106.7.
Slot power ratings at the "Big Three" KCMO facilities currently range from 100 to 106; table ratings 100 to 105.
I have assumed 103 for tables at both facilities (the "3" reflects poker).

15. Gravity Models – Overview
 Location
 Location
 Size
 Everything Else
15

16. “Size” = Number of Slots
WinSpirit Kansas Star
2012 1,300 1,310
2014 1,550 1,500
2016 1,800 2,000
Full Build 2,000 2,000
16

17. Gravity Models – Overview
 Location I
 Location II
 Size
 Everything Else
17

18. Location II:
Competition
18

19. Location II:
Reilly’s Law
19

20. Reilly’s Law:
ms ~ S/d2
Where
ms : market share
S : outlet size (capacity)
d : distance
20

21. Newton’s Law:
F = m/d2
Where
F : gravitational force
m : mass (of each body)
d : distance
21

22. Reilly’s Law:
ms ~ S/d2
Where
ms : market share
S : casino size (capacity)
d : distance
22

23. 23
Midwest Market Projections
Average Distances:
State County ZIP Spdway KStar WinSpirPark C DodgeCKC7thS Wh Cl Horton Mayetta Powhat Argosy IOC Harrahs
KS ALLEN 66732 99 128 138 117 266 106 155 142 122 147 110 109
KS ALLEN 66748 109 114 124 102 251 117 154 134 113 139 120 120
KS ALLEN 66749 100 121 131 106 255 108 146 127 106 132 112 111
KS ALLEN 66751 98 125 136 111 260 105 145 130 110 135 109 108
KS ALLEN 66755 90 135 145 120 269 97 146 134 114 139 101 100
KS ALLEN 66772 103 126 135 118 265 110 159 146 126 151 114 113
KS ANDERSON 66014 67 156 167 140 287 73 132 121 102 127 77 76
KS ANDERSON 66015 89 130 141 114 262 97 135 118 97 123 101 101
KS ANDERSON 66032 71 147 158 129 276 79 121 107 88 113 82 82
KS ANDERSON 66033 61 157 169 139 285 69 117 106 87 111 72 72
KS ANDERSON 66039 79 143 154 127 275 86 136 123 104 129 89 89
KS ANDERSON 66091 80 138 150 121 269 88 128 113 93 118 92 91
KS ANDERSON 66093 87 129 141 112 260 96 131 110 89 114 99 99
KS ATCHISON 66002 42 226 240 205 341 50 35 31 44 37 47 52
KS ATCHISON 66016 44 214 227 193 329 53 36 27 32 33 51 56
KS ATCHISON 66023 52 207 221 186 321 61 39 20 24 26 59 64
: : : : : : : : : : : : : :
: : : : : : : : : : : : : :
: : : : : : : : : : : : : :
KS WYANDOTTE 66106 9 216 228 196 337 7 84 79 65 85 10 11
KS WYANDOTTE 66109 7 216 229 196 337 10 76 70 57 76 10 13
KS WYANDOTTE 66111 7 216 228 196 337 7 82 76 63 82 10 11
KS WYANDOTTE 66112 7 216 229 196 337 7 79 73 60 79 10 11
KS WYANDOTTE 66118 13 223 235 203 344 7 86 81 69 87 7 7
Total KS

24. 24

25. Projected Market Shares
(Share of Sedgwick County Spending)
Kansas Star 2016 91%
Global Gaming 2016 80%
25

26. Gravity Models – Overview
 Location I
 Location II
 Size
 Everything Else
26

27. Location I:
The Closer, the Better
27

28. Location I:
The Closer, the Better
=“Friction”
28

29. Las Vegas Visitation/Distance
0.0
5.0
10.0
15.0
20.0
25.0
0 500 1,000 1,500 2,000 2,500
LasVegasVisitors/000adults
Distance (miles)

30. Mississippi Visitors/Day/000
0.0
4.0
8.0
12.0
16.0
20.0
0 100 200 300 400 500 600 700
MississippiVisitors/Day/000adults
Distance (miles)

31. Casino X / players’ club data
$0
$200
$400
$600
$800
$1,000
0 50 100 150 200 250 300 350 400
AverageAnnualSpending/Adult
Distance from Casino X (miles)

32. Casino Y: players’ club data
$0
$100
$200
$300
$400
$500
0 20 40 60 80 100 120
AverageAnnualSpending/Adult
Distance from Casino Y (miles)

33. 0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
5.0 5.5 6.0 6.5 7.0 7.5 8.0 8.5
ln(distance)
ln(LasVegasvisitors/0000)
33
Las Vegas Visitation [ log-log ]

34. Las Vegas: slope of the curve
y = -1.0082x + 10.75
R2
= 0.9631
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
5.0 5.5 6.0 6.5 7.0 7.5 8.0 8.5
ln(distance)
ln(LasVegasvisitors/0000)
34

35. Mississippi: steeper slope
y = -1.4088x + 11.25
R2
= 0.9353
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
3.5 4.0 4.5 5.0 5.5 6.0 6.5 7.0
ln(distance)
ln(Mississippivisitors/day/0000)
35

36. Laughlin: much steeper slope
y = -1.9121x + 16.299
R² = 0.9552
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
5.0 5.5 6.0 6.5 7.0 7.5 8.0 8.5
ln(Laughlinvisitors/0000)
ln(distance)
36

37. Casino X: isolated market
y = -0.8982x + 7.8944
R² = 0.6804
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5 6.0 6.5
ln(adjustedannualspending/adult)
ln(distance from Casino X)
37

38. Casino Y: competitors afar
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5
ln(annualspending/adult)
ln(distance from Casino Y)
38

39. Casino Y: less competition close
y = -0.886x + 8.0919
R² = 0.8505
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5
ln(annualspending/adult)
ln(distance from Casino Y)
39

40. 40
(1.00)
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00 5.50
ln(spendingperadult)
ln(distance)
Exhibit A-9: Slot Spending Declines With Distance at Casino Z
per model
per club
per W-2s

41. 41
(1.00)
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00 5.50
ln(spendingperadult)
ln(drive time)
Exhibit A-10: Slot Spending Declines With Travel Time at Casino Z
per model
per club
per W-2s

42. 42
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
0
5
10
15
20
25
30
0-10 miles 10-20
miles
20-30
miles
30-40
miles
40-50
miles
50-70
miles
70-100
miles
100-150
miles
150-
300(±)
miles
> 300(±)
miles
AnnualVisits(and$Win)PerPlayer
Exhibit A-11: Rates of Visitation (and Win) vs. Distance at Casino Z
Trips / Play
$ Win / Pla

43. Model vs. Real World
43

44. 44
Projection / Source Actual / Source
Facility / Market:
Zia Park / Hobbs, NM $53.7 (1) $68.9 (2)
Emmetsburg / Iowa $23.4 (3) $26.4 (4)
Northwood / Iowa $34.2 (3) $67.5 (4)
Riverside / Iowa $82.0 (3) $85.8 (4)
IOC Waterloo / Iowa $96.8 (3) $76.9 (4)
$30.2
$49.9
Hoosier Park / Indiana $275 (7) $201 (8)
Indiana Live / Shelbyville $261 (7) $228 (8)
Wild Rose Clinton / Iowa $48.2 (9) $39.2 (10)
DBQ Diamond Jo / Iowa $61.9 (9) $68.4 (10)
Jumers Rock Island / Illinois $89.7 (9) $75.2 (11)
Dodge City / Kansas $40.7 (12) $37.7 (13)
Tioga Downs / NY (5) (6)$42.2

45. Global Gaming /
WinSpirit Casino
45

46. 46

47. 47
Exhibit A: Summary of Projections
(all in then-year $)
Global / WinSpirit
2012 2014 2016 Full Build
Slot Machines 1,300 1,550 1,800 2,000
Table Games (not inc. poker) 30 40 40 40
Total Gaming Positions ( " " ) 1,480 1,790 2,040 2,240
Slot Power Rating 111.0 110.8 110.9 111.1
Total Gaming Revenues ($million): (6 mos)
With no Local Competition $62.1 $141.2 $155.8 $160.5
With Competitor in Park City $46.8 $111.7 $127.3 $109.1
Total Annual Visitation (000): (6 mos)
With no Local Competition 716 1,583 1,684 1,760
With Competitor in Park City 578 1,316 1,434 1,278
Annual "Tourist" Visitation (000): (6 mos)
With no Local Competition 67 173 187 198
With Competitor in Park City * 68 175 189 197

48. 48
$50
$100
$150
$200
$250
2011 2012 2013 2014 2015 2016 Full Build
TotalGamingWin($mn)
Note: Cummings projections are for "stabilized operations"
Exhibit B: Cummings Projections Compared to Global Gaming's
Global
Cummings

49. Peninsula Gaming /
Kansas Star Casino
49

50. 50

51. 51
Exhibit A: Summary of Projections
(all in then-year $)
Peninsula / Kansas Star
2012 2014 2016 Full Build
Slot Machines 1,310 1,500 2,000 2,000
Table Games (not inc. poker) 32 42 50 50
Total Gaming Positions ( " " ) 1,502 1,752 2,300 2,300
Slot Power Rating 97.5 102.9 102.9 102.9
Total Gaming Revenues ($million):
With no Local Competition $159.1 $192.1 $213.4 $213.4
With Competitor in Park City $109.3 $143.7 $169.4 $141.0
Total Annual Visitation (000):
With no Local Competition 1,741 1,997 2,248 2,248
With Competitor in Park City 1,329 1,620 1,886 1,634
Annual "Tourist" Visitation (000):
With no Local Competition 70 121 144 144
With Competitor in Park City * 70 122 145 142

52. 52
$50
$100
$150
$200
$250
2011 2012 2013 2014 2015 2016 = Full Build
TotalGamingWin($mn)
Note: Cummings projections are for "stabilized operations"
Exhibit C: Cummings Projections Compared to Peninsula's
Peninsula
Cummings

53. The Difference
Between the Two:
53

54. 54
$50
$100
$150
$200
$250
2011 2012 2013 2014 2015 2016 Full Build
TotalGamingWin($mn)
Note: Cummings projections are for "stabilized operations"
Exhibit B: Cummings Projections Compared to Global Gaming's
Global
Cummings

55. 55
$50
$100
$150
$200
$250
2011 2012 2013 2014 2015 2016 = Full Build
TotalGamingWin($mn)
Note: Cummings projections are for "stabilized operations"
Exhibit C: Cummings Projections Compared to Peninsula's
Peninsula
Cummings

56. 56

57. 57

58. 58
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
0
5
10
15
20
25
30
0-10 miles 10-20
miles
20-30
miles
30-40
miles
40-50
miles
50-70
miles
70-100
miles
100-150
miles
150-
300(±)
miles
> 300(±)
miles
AnnualVisits(and$Win)PerPlayer
Distance Matters
Trips / Play
$ Win / Pla

59. Will E. Cummings
Cummings Associates
135 Jason Street
Arlington, MA 02476
(781) 641-1215
cummingsw@aol.com
59

60. Gaming Revenue
Projections for
South-Central Kansas
Presentation to Lottery Gaming Facility Review Board
by Will Cummings / Cummings Associates
December 1, 2010
60