Macau casino gross gaming revenue (GGR) is likely to rise by 14 percent to 15 percent year-on-year for October, “despite a slower than expected start to Golden Week this year”, said a note from Japanese brokerage Nomura.
“October GGR typically lifts approximately 13 percent sequentially from September, which would translate into daily GGR of circa MOP800 million [US$99.5 million] for the month, implying year-on-year growth of approximately 12 percent,” said the institution in a Thursday memo.
But it added, citing as one source some conversation with a Macau operator: “Despite the slower-than-expected start to Golden Week this year, trends appear to have normalised, and we estimate October daily GGR will be circa MOP800 million to MOP810 million, or +14 percent to +15 percent year-on-year.”
The autumn Golden Week period included China’s National Day on October 1, which this year fell on a Sunday. China’s State Council declared the 2017 holiday period as running for eight days from October 1 to 8, as it included the lunar calendar-based Mid-Autumn Festival, which this year fell on October 4.
The aggregate number of visitor arrivals to Macau in the holiday period was up 10.3 percent year-on-year. Several brokerages – citing either industry unofficial returns or ground checks – suggested in respective October 9 memos, that year-on-year growth in Macau casino GGR for the first eight days of the month was about 10 percent, versus the calendar-year growth of 18.8 percent as of September 30. Industry commentators nonetheless have noted there need not be any correlation between aggregate Macau visitor numbers and Macau casino GGR.
Several institutions – again citing unofficial sources – suggested mass-market GGR growth had been sluggish in Golden Week and that VIP GGR had been assisted by higher than statistically average hold for the operators.
Banking group Morgan Stanley noted in a Tuesday note that there could be some structural challenges for the market in the fourth quarter.
“The recent slowdown in VIP, due to a high base [of comparison year-on-year], a macro/liquidity slowdown [in mainland China] and a potential premium mass slowdown (ATM [automated teller machine] cash withdrawal, customers going to junkets for liquidity) could be risks,” said the institution.
The latter reference to ATMs related to possible risk to the premium mass segment: players betting in high denominations via cash play on the main floor rather than the credit-based play of the VIP rooms.
Since July, holders of mainland China-issued China UnionPay Co Ltd bank cards using them for cash withdrawals at Macau ATMs have been subject in all instances to so-called ‘know-your-customer’ checks via newly-installed technology, including facial recognition systems. Commentators have said the move by the authorities was designed to monitor the amount of money flowing offshore from mainland China via Macau’s banking system, and to reconcile the identity of card users relative to the name of the account being accessed.
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