Macau’s casino gross gaming revenue (GGR) continues to languish despite the opening of the Sands China Ltd.’s new Cotai casino resort, the Parisian Macau and the Mid-Autumn Festival holiday, according to the latest note released by brokerage Sanford C. Bernstein Ltd.
“Weaker than expected” was how Bernstein analysts Vitaly Umansky and Yang Xie described Macau’s GGR, posting an average daily rate of MOP571 million (US$71.5 million).
“The weaker than expected GGR during the week ended September 18th is in light of the opening of The Parisian and the Mid-Autumn Festival holiday. However, the week’s results are still over 15 percent above the similar week last year,” the analysts said.
Assuming an average daily rate of MOP540 million (US$67.59 million) to MOP590 million (US$73.85 million) for the remainder of the month, Bernstein has forecasted that the former Portuguese enclave’s GGR would be “in the range” of MOP18 billion (US$2.25 billion), which would represent a year-on-year increase of 4 percent to 7 percent.
“While we still do not have market share breakdowns, we understand from channel checks that the Parisian has started fairly strongly in mass, taking share largely from the [Macau] peninsula properties (in particular SJM),” the brokerage noted.
“Further, Wynn Palace, which had strong VIP results in the weeks following its opening, may now be beginning to decelerate which may be pointing to a longer than expected ramp up at this stage. We will need to wait until Golden Week performance and then third quarter earnings results to get a better sense of how strong the (mass) recovery may actually be and how market share is beginning to shift,” it said.
Meanwhile, the Buckingham Research Group Inc. is predicting a flat September GGR for Macau compared to the same period last year.
Buckingham analyst Christopher Jones also noted that Macau will see a 3.3 percent third-quarter contraction year-on-year, which he said would be “the best quarterly performance the market has seen since the second quarter, 2014.”
He added: “there could be upside to these expectations as the Parisian and Wynn Palace continue to ramp up, offsetting what is traditionally a slowdown in volume in late September; as customers hold off visiting Macau, in anticipation of the all-important Golden Week, the first week of October.”