Macau casino gross gaming revenue (GGR) for the first seven days of July was circa 12 percent lower than for the final week of June, estimated Citigroup in a Monday note.
GGR for the opening seven days of this month was estimated by the institution at MOP3.85 billion (US$478.8 million) “implying a daily run rate of about MOP550 million,” stated Citigroup.
“This was about 12 percent lower than that of the final week of June, at approximately MOP628 million per day,” said the memo.
“We are conservatively keeping our July GGR forecast unchanged at MOP19.0 billion,” about 78 percent of the pre-pandemic July 2019 level, said the financial institution.
Macau’s June GGR had itself been down circa 12 percent on a very strong May, according to data from the city’s government.
“Macau is still in the seasonal trough – and we anticipate Macau’s daily run-rate to come out from the trough around mid-July – so this weekly data point is not entirely surprisingly to us,” added Citigroup.
The institution said that based on industry sources, it estimated VIP gambling volumes were about 3 percent to 4 percent lower month-on-month, but with VIP hold rate appearing to be within a “normal” range.
Mass-play volumes were put at about 4 percent to 5 percent lower month-on-month.
Citicorp’s George Choi and Ryan Cheung said in a note previewing the Macau gaming market’s second-quarter earnings season, referring to earnings before interest, taxation, depreciation and amortisation: “We expect Macau’s industry EBITDA to fall about 5 percent quarter-on-quarter,” to the equivalent of US$1.95 billion. That would still be up about 18 percent judged year-on-year, they added.
The analysts nonetheless also observed: “Our analysis suggests that EBITDA margin for the six casino operators in aggregate still holds up relatively well at around 28 percent, and this is already reflecting the significant disruption from The Londoner [Macao] Phase 2 renovations and the [market’s] weaker retail sales.”
(Updated 9.25am, July 10)
