Macau’s casino gross gaming revenue growth for May could have been nearly three percentage points higher than the 12.1 percent achieved, had it not been for weak hold in VIP gambling by the city’s gaming venues, said a note from Japanese brokerage Nomura.
“On a hold-adjusted basis, we estimate VIP and overall GGR growth would have been closer to 18 percent and 15 percent, respectively, or approximately 300 basis points higher than reported and roughly in line with consensus,” stated the memo from Harry Curtis, Daniel Adam and Brian Dobson.
The brokerage said it had spoken with several casino property managers in Macau, with them having “confirmed that hold was weak, either early or later in the month; in some cases it was nearly 50 percent below normal (2.85 percent)”.
The institution estimated that June GGR growth judged year-on-year would be 10 percent to 15 percent, i.e., again below the average 20.1 percent achieved in the five months to May 31.
“Assuming June GGR slows sequentially in line with the trailing six-year median, or roughly 10 percent lower versus May, our GGR estimate for the month would be around MOP25 billion [US$3.09 billion] to MOP26 billion,” added the Nomura team.
Brokerage Sanford C. Bernstein and investment bank Credit Suisse AG mentioned in Friday notes that the FIFA World Cup 2018 – an international soccer tournament to be held in Russia from June 14 to mid-July – might create a headwind for Macau casino GGR in those months.
Deutsche Bank Securities Inc indicated in a Monday memo that some Macau junkets take their VIP players to the World Cup – an event held every four years – as part of their customer management, and thus away from the Macau gambling market.
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"We made that decision… to move away at this point in time from a permanent resident show, to a… variety of shows"
Chief executive of Macau casino operator MGM China