May 31, 2018 Newsdesk Latest News, Macau, Top of the deck
Macau’s casino market continues to rebound, and U.S.-based casino operator Las Vegas Sands Corp aims to expand its business faster than its competitors, particularly in the VIP segment, stated Robert Goldstein (pictured), the firm’s president and chief operating officer.
Las Vegas Sands is the parent company of Macau gaming operator Sands China Ltd. Mr Goldstein is a non-executive director of the Macau unit.
“The rolling [VIP] business [in Macau] has recovered… We are very interested in getting a bigger slice of the [VIP] market. We’ve done well, but not well enough from our expectations,” said Mr Goldstein.
The executive was speaking on Wednesday at an investor event called the 34th Annual Bernstein Strategic Decisions Conference, held in New York City, in the United States.
Macau casino gross gaming revenue (GGR) in the VIP segment rose 21.0 percent year-on-year in the first quarter 2018. The rate of VIP growth was slightly faster than the 19.9 percent recorded for GGR in the mass segment, according to official data.
Las Vegas Sands is adding additional amenities across its entire property portfolio in Macau, aiming to “grow faster than the Macau market in this [VIP] segment”.
The company said last year it would be investing US$1.1 billion in Macau in the three years to 2020. The bulk of that investment – approximately US$700 million – would be used for rebranding the Sands Cotai Central property as “The Londoner Macao”.
The firm will also be converting the Four Seasons Residence tower into a 295-suite hotel, and adding 350 suites at the St. Regis Tower Suites, both projects to be completed in late 2019.
The company is currently revamping the VIP gaming areas at the Venetian Macao and Plaza Macao.
“We are redoing our VIP rooms in the Plaza and the Venetian, to be even more competitive,” said Mr Goldstein. “Our success has been tied to mass, premium-mass and slots, more than VIP. But we are very dedicated to improving our share of the high-end rolling direct market, as well,” he added, referring to VIP players managed by the house, rather than by junkets.
According to the executive, the current growth in the Macau market “is fuelled by more players, and less bankroll”.
“It [such growth] also has a residual effect on the premium-mass market; the more money there is in the market, is good for the premium-mass as well,” stated Mr Goldstein.
According to the COO, “the affluent customer out of China, beyond Guangdong” is driving the growth in Macau’s premium-mass segment.
“They are not as junket-oriented as their predecessors, they tend to gravitate more to direct play, and that’s also a benefit to the [company’s] margin,” said Mr Goldstein.
He added: “Today, the diversification and segmentation in the Macau market is much different, compared to 2013 and 2014, where we [operators in the Macau market] were tied to a very small amount of junket customers that were betting a huge amount of money, which, in my opinion, was not sustainable.”
Mr Goldstein said additionally that no market in Asia “competes or compares to the strength of Macau”, given the access to mainland China consumers and the diversity of its product offering.
“I believe Macau, today, is probably too far ahead for any other place to replicate,” he stated.
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Head of Asia gaming and leisure research at JP Morgan Securities (Asia Pacific)