Macau casino operators MGM China Holdings Ltd. and Sands China are expecting growth in their business for the Chinese New Year (CNY) period.
Macau welcomed the Year of the Monkey this week and during the celebration, MGM CEO and executive director Grant Bowie told reporters that the company’s performance during the CNY would remain stable year-on-year.
“Traditionally, the first two or three days are always quieter but business is looking very strong for the rest of the Chinese New Year period,” Bowie said, quoted by public broadcaster TDM.
Bowie expressed his opinion that the local mass market had rebounded and that the city is recovering from its long gaming slump. He also revealed the company’s plan to study the prospect of salary hikes for employees during MGM’s annual meeting in March.
Bowie was expressing his optimism on Macau gaming even before the CNY holidays, saying that he’s starting to see some early signs of consolidation and opportunities for growth in the region.
“It is not nearly as bad as people say it is and we can obviously build our business from this base and continue to be successful,” Bowie said, adding that the company would look positively for improvement in gaming revenue in 2016 as operators focus on non-gaming initiatives to bring more customers.
Meanwhile Sands China president Wilfred Wong is even more optimistic after he estimated slight growth in business for the CNY from the same period a year ago. He also revealed that the company’s hotel room reservations had posted a better performance this year.
Preliminary figures from the Public Security Police showed that visitors to Macau during the holiday period’s first four days reached 548,536, up 5.2% from the previous CNY.
Analysts are also cautiously suggesting that February could be the first month of GGR growth since May 2014, supported by the typical holiday GGR boost. The CNY holiday period, which typically sees a spike in gambling in Macau, started on February 19 last year. This year the week-long holiday period started on February 7.
“Put together, we think that February’s results could look something like October’s MOP20 billion, which would result in 2 percent year-on-year growth,” said Union Gaming analyst Grant Govertsen. “We don’t think this is a stretch as GGR has exceeded MOP18 billion in each of the last two months despite not having a traditional holiday benefit.”
However, Govertsen expects Macau’s GGR to immediately return to negative year-on-year trends in March and April before finally catching some positive tailwinds heading into summer.