Macau casino gross gaming revenue (GGR) for the first nine days of January was down more than 9 percent compared to the final third of December, with the average daily rate at MOP266 million (US$33.1 million) versus MOP293 million in the last 12 days of December, said a Monday note from brokerage Sanford C. Bernstein Ltd, citing its own “channel checks”. The figure for the first nine days of January was still an improvement on the MOP257-million average daily rate for the full month of December.
Macau’s month-to-date GGR of MOP2.4 billion was down – in terms of average daily rate – by 67 percent compared to January 2019’s average daily rate of MOP805 million, but up 3 percent year-on-year versus January 2021’s average daily rate of MOP259 million, said analyst Vitaly Umansky.
“During January 2022 month-to-date, VIP average daily rolling volume was down 50 percent month-on-month as junket activity continues to wind down – December 2021 VIP volume was already down 40 percent to 45 percent month-on-month, and the majority of VIP GGR was generated by direct VIP,” wrote Mr Umansky.
He added: “Daily mass GGR was strong and up by 10 percent to 15 percent from December 2021.”
The memo stated: “VIP is – and will most likely remain – weak as the junket business is being retrenched.” The mass segment had been “performing well” as visitor volume to Macau “further increased during the New-Year holiday weekend”.
The institution said – citing official data and its own research – that the average daily volume of arrivals and departures by visitors to Macau for December 30 to January 5 inclusive, was 63,000, i.e., up 5 percent on the prior week. Sanford Bernstein also stated that daily visitor volume for January 1 to 5 inclusive, had been up 17 percent on the monthly average in December.
But the brokerage voiced some caution regarding mainland China’s Covid-19 outlook. According to media reports, a number of local Covid-19 cases has been detected in Shenzhen, Guangdong, near that mainland province’s border with Hong Kong. Macau also shares a border with Guangdong.
All ferry services between Macau and Shenzhen have been halted since Sunday (January 9), until further notice. The suspension was confirmed by the Macau government in a Saturday written announcement.
On Monday, the Global Times, a mainland newspaper, reported that the Chinese mainland had reported a total of 157 new Covid-19 cases, of which 97 were locally transmitted infections. The majority of cases were in central China’s Henan province, with 60 cases, stated the newspaper.
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"The six Macau casino operators should not be penalised for upping expenditure on player incentives, so long as their EBITDA margins are not materially diluted”
George Choi and Ryan Cheung
Analysts at Citigroup