Casino gross gaming revenue (GGR) in Macau fell by 94.5 percent year-on-year in July, to MOP1.34 billion (US$168.4 million), according to data from the city’s Gaming Inspection and Coordination Bureau, released on Saturday. But judged month-on-month, the July tally was up 87.7 percent from the MOP716 million achieved in June.
There has been recently some incremental easing of travel from Macau to the neighbouring Chinese mainland province of Guangdong, that some industry commentators said was part of small steps in the right direction for the early stages of Macau’s rebound from the disruption wrought by Covid-19.
Month-on-month changes in GGR this year have however previously shown some volatility. May GGR went up 134 percent, compared to April, despite May GGR being down 93.2 percent year-on-year.
June GGR had shrunk by about 97.0 percent from the prior-year period, according to government data. That slump – and those seen in earlier months – had coincided with a string of travel restrictions regionally since the advent of the pandemic.
Saturday’s data meant that the Macau market’s GGR tally for the first seven months of 2020 stood at MOP35.06 billion, down 79.8 percent from the prior-year period.
While most mainland residents face no restrictions on entry to Macau in relation to Covid-19, the mainland authorities have not yet restarted the exit visa systems most commonly used for mainlanders to visit Macau.
The Individual Visit Scheme (IVS), which allows mainlanders to travel independently to Macau and some other places, was reportedly suspended in late January, as part of Covid-19 containment measures, with tour group visas paused around the same time as the IVS ones. A return of IVS visas has been mentioned by industry insiders as a key element in Macau’s casino market recovery.
A Sunday note from analysts DS Kim, Derek Choi and Jeremy An, at JP Morgan Securities (Asia Pacific) Ltd, stated: “The Macau-Guangdong ‘travel bubble’ – which kicked off on 15 July – has been of little help to gaming demand, as the issuance of tourist visas (IVS or package-tour) is still suspended while business permits (which can be used by hardcore high-end players) take three to five weeks to be arranged/issued.”
Travel between Macau and Hong Kong is still subject ordinarily to a 14-day quarantine period in each direction. The Hong Kong government announced just over a week ago, that it had extended to September 7 its deadline for the end of a 14-day quarantine rule for arrivals from Macau, mainland China and Taiwan.
Brokerage Sanford C. Bernstein Ltd mentioned in Monday commentary on Macau’s GGR outlook, that a surge in the number of Covid-19 infections in Hong Kong – the daily tally of new cases had surpassed 100 for 12 consecutive days as of Sunday, according to the Hong Kong government – was “not positive” for Macau.
“Hong Kong is estimated to contribute up to 15 percent of [Macau] GGR, and the worsening situation in Hong Kong is not positive to Macau in the near term,” wrote analysts Vitaly Umansky, Tianjiao Yu, and Kelsey Zhu.
Macau’s Secretary for Economy and Finance, Lei Wai Nong, who oversees the city’s casino industry, urged the public last week to be “patient” about the return of large-scale tourism, adding that there needed to be sufficient “risk control” measures in relation to Covid-19.
(Updated Aug 3, 9.20am)
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”As the Macau gaming revenue structure is now leaning heavily towards the mass business … once the border fully reopens, the recovery from mass should drive the sector to bounce more swiftly”
Vitaly Umansky, Louis Li and Shirley Yang
Analysts at Sanford C. Bernstein