GGRAsia – Macau to stay top single-market for gaming: Hornbuckle

Macau to stay top single-market for gaming: Hornbuckle

Jul 12, 2022 Newsdesk Latest News, Macau, Top of the deck

Macau would “forever be” the largest single-jurisdiction casino gaming market in the world, suggested the boss of United States-based MGM Resorts International, majority owner of Macau operator MGM China Holdings Ltd.

Bill Hornbuckle (pictured in a file photo), chief executive and president of MGM Resorts, as well as being board chairman of MGM China, made the comments in remarks during a round-table discussion with business news television channel CNBC. The round-table discussion – including also the CEOs of respectively Las Vegas Sands Corp and Wynn Resorts Ltd – will be aired on Wednesday (July 13).

Macau was, pre-pandemic, “seven, eight times Las Vegas in scale,” stated the MGM Resorts boss in an extract of the discussion released on social media. If it “comes back half to begin with, and then some… it’s the largest gaming market in the world, bar none; and it will forever be,” he added.

Macau has had a stop-start recovery pattern in the past two years, coinciding with periodic outbreaks of Covid-19 on the mainland and in Macau, as China applies a containment policy to the disease, rather than the ‘living-with-Covid’ policy adopted in other places.

Macau is currently undergoing its largest Covid-19 community outbreak since the beginning of the pandemic, and has paused its casinos for seven days, starting from Monday (July 11). It is the first hiatus for the local casino industry since a 15-day pause in February 2020.

A Monday note from brokerage Sanford C. Bernstein Ltd said that in the prior 10 days, Macau’s average daily rate of casino gross gaming revenue (GGR) had been under US$2.5 million, down 62 percent sequentially on the June 20 to 30 period.

In 2019, the most recent year of pre-pandemic trading, Macau’s GGR was nearly MOP292.46 billion (US$36.17 billion, at current exchange rates), according to official data. In the same year, casino GGR for the Las Vegas Strip in Las Vegas, Nevada, was nearly US$6.59 billion, according to data compiled by the University of Nevada, Las Vegas.

Also present at the round-table discussion with CNBC were Robert Goldstein, chairman and CEO of Las Vegas Sands, parent of Macau operator Sands China Ltd. Mr Goldstein is also chairman and CEO of the latter firm.

The third participant was Craig Billings, CEO of Wynn Resorts, and of the group’s Macau operations unit, Wynn Macau Ltd.

In the extract of the discussion, Mr Billings stated, referring to Wynn Macau Ltd: “The only thing that keeps me up at night about Macau, is the state of my team.”

He added: “They’ve been essentially trapped there for years. It’s very, very difficult, and I appreciate everything they do for us.”

Since shortly after the advent of the Covid-19 alert in early 2020, certain travel restrictions have applied in terms of entering and leaving Macau.

Las Vegas Sands’ Mr Goldstein, who recently spoke at a Sanford Bernstein investment conference regarding his confidence in Macau’s recovery, said in his comments to CNBC, that recovery might be this year or 2023.

“It’s a tough time. You’ve got to basically hunker down, and wait for it to turn,” he added. “The idea it doesn’t turn, is hard to imagine. It’s going to turn probably this year or next.”

Mr Goldstein said that “at peak” the Macau market had generated for the group annually “US$3.5-billion” in earnings before interest, taxation, depreciation and amortisation (EBITDA). “I think we will make a lot more than that in the future there. It’s got a bright future,” he stated.