• About Us
  • The Team
  • Advertise with Us

The latest news on the gaming industry in Asia

() () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () ()
  • Home
  • Macau
  • Philippines
  • Singapore
  • Japan
  • Rest of Asia
  • World
  • Features
  • Industry Talk
  • Trends & Tech
  • follow
    • Facebook
    • Twitter
    • RSS Feed
    • LinkedIn

Mass-led GGR recovery starting in Macau: DB’s Tang

Sep 09, 2016 Newsdesk Latest News, Macau, Top of the deck  


Mass-led GGR recovery starting in Macau: DB’s Tang

Gaming spend per visitor in Macau has started to rise, says a note from Karen Tang of Deutsche Bank AG, citing “extensive interviews” over the past two weeks with casino service staff and hosts at premium mass gambling areas in the city’s casinos.

“We conclude that Macau is now at the start of a mass-led GGR [gross gaming revenue] recovery,” she wrote in a Thursday note.

In August, Macau’s aggregate monthly gaming revenue tally – meaning VIP and mass combined – rose 1.1 percent year-on-year. The monthly result marked the first time in 27 months that such revenue had not contracted, judged year-on-year. August was buoyed – said some investment analysts, citing unofficial figures – by the mass segment. The local regulator only gives the split between VIP and mass revenue on a quarterly basis.

On September 3, Macau’s Secretary for Economy and Finance, Lionel Leong Vai Tac, issued some words of caution regarding whether the August result marked the start of a trend of improvement in monthly aggregate GGR, observing that in the month of September, Macau GGR was often seasonally weaker than that of the month of August.

Nonetheless, Deutsche Bank’s Ms Tang estimates that mass-market GGR growth will accelerate to “low teens” of percent year-on-year in 2017, because of some positive structural changes in the local gambling consumer market, that the bank thinks will help push up spend per mass player.

“We forecast that mass GGR growth will accelerate from 4 percent year-on-year in second quarter 2016, to 10 percent year-on-year in the second half 2016 and to 12 percent year-on-year in 2017,” stated Ms Tang.

“As mass has higher margins, we lift our sector EBITDA [earnings before interest, taxation, depreciation and amortisation] by 10 percent to US$6.6 billion for 2017,” she added.

Overnight stays

Ms Tang said that in the second quarter, Macau’s mass-market GGR was up 4 percent year-on-year, even though visitor numbers for the period were down 0.5 percent.

The local regulator, the Gaming Inspection and Coordination Bureau, had reported mass-market table baccarat GGR as only having grown by 0.2 percent in the second quarter. Baccarat is the main game in Macau’s casino sector.

Brokerage Union Gaming Securities Asia Ltd said in a note in late August that mass-market table GGR would have expanded by 4.4 percent year-on-year in the second quarter, were it not for the effects of so-called “table reclassification”. This is where some Macau operators label the upper end of some of their mass-market operations as “VIP” in order that patrons can smoke at the table.

Ms Tang said in her latest note, referring to second-quarter data on the structure of the visitor market: “Importantly, Chinese visitors are converting from day-trippers (-8 percent year-on-year) to overnighters (+11 percent year-on-year). In June, for the first time, overnighters outnumbered day-trippers. Longer stay means more play.”

Deutsche Bank said its proprietary research on Macau table count indicated the proportion of the city’s baccarat tables with minimum bets of more than HKD2,000 [US$258], rose from 29 percent of the mass floor in December to 36 percent by July, “with the minimum bet rising prominently since July”.

Ms Tang added: “We believe this player conversion can sustain premium mass growth for the next one to two years.”

Proprietary research by brokerage CIMB Securities Ltd, published last week, indicated the proportion of Macau mass-market gaming tables offering minimum bets of HKD2,000 and above during August was the highest in the market for 11 months.

Analyst Christopher Jones of the Buckingham Research Group, said in a note last week following the August GGR data, that average per capita gaming spend per day probably increased by 1.1 percent year-on-year in August. He added that would mark the first such increase since May 2014, excluding Chinese New Year 2015.


  • tweet
Related articles
  • Plenty of likely suitors for Wynn Macau Ltd: Telsey
    Plenty of likely suitors for Wynn Macau...

    Apr 20, 2018  

  • Macau VIP GGR growth shade faster than mass in 1Q18
    Macau VIP GGR growth shade faster than...

    Apr 16, 2018  

More news
  • Belle Corp again pitches CoD Manila ‘expansion’
    Belle Corp again pitches CoD Manila...

    Apr 24, 2018  

  • Macau April GGR to expand by at least 18pct: analysts
    Macau April GGR to expand by at least...

    Apr 24, 2018  


Latest News

Belle Corp again pitches CoD Manila ‘expansion’

Belle Corp again pitches CoD Manila ‘expansion’

Apr 24, 2018  

Belle Corp, the landlord of the City of Dreams Manila casino resort (pictured) in the Philippines, has made a proposal for its expansion and has submitted the idea to the venue’s operator, Melco...
Read More
Macau April GGR to expand by at least 18pct: analysts

Macau April GGR to expand by at least 18pct: analysts

Apr 24, 2018  

Macau Legend plans min US$300-mln further Laos input

Macau Legend plans min US$300-mln further Laos input

Apr 24, 2018  

Slideshow

Macau casinos celebrate Chinese New Year

Interviews

  • BMM prepped for Macau EGM regulation update: White
    BMM prepped for Macau EGM regulation update: White

    Jan 04, 2018  

    BMM Testlabs “ticks all the boxes” with regard to its...
  • Japan, Cambodia, Vietnam casino biz to watch: Klebanow
    Japan, Cambodia, Vietnam casino biz to watch: Klebanow

    Dec 08, 2017  

    The regulated casino industry is well versed in dealing...
  • Cloud services, e-Sports highlights of MGS 2017: Chun
    Cloud services, e-Sports highlights of MGS 2017: Chun

    Oct 23, 2017  

    The presence of some of the leading cloud computing...
  • Crunch time for Tokyo casino option: Caesars exec
    Crunch time for Tokyo casino option: Caesars exec

    Jul 11, 2017  

    The Tokyo local election setback for Japan’s governing...
  • Suncity bets on Vietnam, resurgent Macau VIP: Andrew Lo
    Suncity bets on Vietnam, resurgent Macau VIP: Andrew Lo

    Jul 06, 2017  

    A multibillion U.S. dollar casino project on Vietnam’s...

Pick of the Day

"Aristocrat’s diversified mobile game portfolio approach has the potential to manage risk and monetise better"

Donald Carducci, Shaun Cousins and Shalin Doshi

Analysts at banking group JP Morgan



Most Popular

  • NagaCorp starts pile cap work for Russia casino: regulatorNagaCorp starts pile cap work for Russia casino: regulator April 23, 2018
  • Plenty of likely suitors for Wynn Macau Ltd: TelseyPlenty of likely suitors for Wynn Macau Ltd: Telsey April 20, 2018
  • March helps 1Q Macau visitor tally expand by 9pctMarch helps 1Q Macau visitor tally expand by 9pct April 23, 2018

Copyright 2017 TEAM Publishing and Consultancy Ltd / All rights reserved
  • Code of Ethics
  • Privacy Policy
  • Useful Links
  • Contact Us