World Cup took a bite of casino revenue
Gaming analysts looking at Macau’s casino industry expect gross gaming revenues for June to rebound after a sluggish May. According to GGRAsia, Sanford C. Bernstein Ltd. analysts Vitaly Umansky, Zhen Gong and Kelsey Zhu predict “an estimated year-on-year increase in June of +20 percent to +21 percent.” JP Morgan Securities (Asia Pacific) Ltd. concurred that June GGR would grow 20 percent or more over 2017.
That’s welcome news after May, in which the acceleration of growth sputtered, with GGR topping out at 12.1 percent. That pinch was extra hard coming after April’s 27.6 percent expansion. In March GGR was up 22.2 percent year-on-year, according to data released by the city’s Gaming Inspection and Coordination Bureau.
Sanford Bernstein noted that GGR was slow during the FIFA World Cup with a lower VIP hold rate. “Month-to-date, the VIP hold rate was at the lower end of the range,” the team wrote. “Both mass GGR and VIP volume were flat month-on-month compared with the May average daily rate number.”
JP Morgan’s DS Kim and Sean Zhuang said in a memo that GGR during the sporting event was likely to have been circa MOP715 million per day, “which is quite decent/resilient in our view, especially considering the slow seasonality post the (Golden Week) holiday and negative impact from the World Cup.”
Meanwhile, according to CDC Gaming Reports, gaming stocks in the market felt the impact of an escalating trade dispute between the United States and other countries including China. The brewing trade war sent the share values of nearly all the major casino operators and gaming equipment manufacturers sliding.
“The risks for Sheldon Adelson’s Sands casinos are quite high,” China Market Research Managing Director Shaun Rein told Forbes.
