GGRAsia – Macau VIP revenue down 45 pct in March: DB

Macau VIP revenue down 45 pct in March: DB

Apr 07, 2015 Newsdesk Latest News, Macau, Top of the deck

Deutsche Bank AG in New York said in a note seen by GGRAsia on Tuesday that it estimated Macau VIP gambling revenue fell by 45.4 percent year-on-year in March.

The note from investment analyst Carlo Santarelli also said the bank thinks mass table revenue was down 29.4 percent market wide, while slot revenue decreased 24.4 percent.

Deutsche Bank gave no commentary on its estimates, which are understood to be based on unofficial industry returns.

Although Macau reported on April 1 that aggregate revenue for March fell 39.4 percent year-on-year, some official information on the trends of the different gaming segments won’t be available until later this month.

According to the website of Macau’s casino regulator, the Gaming Inspection and Coordination Bureau, the first-quarter numbers for Macau’s casino industry are likely to be published in the third week of April. The quarterly data is the only format officially employed to show the split between VIP table play, mass market tables and slots.

Deutsche Bank nonetheless said it believed that VIP chip roll volume for March – excluding roll by players directly managed by the casinos rather than by the junkets – was down 54.2 percent Macau-wide and judged year-on-year.

According to Deutsche Bank, Sands China Ltd was roughly at par with the market in its mass-market table revenues for March, with a 30.4 percent year-on-year decline. The institution said it estimated Wynn Macau Ltd had heavily outperformed the market in mitigating its mass table revenue decline in March, with only a 4.7 percent retreat from the prior year period. MGM China Holdings Ltd was also said to have slightly outperformed the market, with a 24.3 percent slip in mass table revenue.

MGM China was the only one of the three operators mentioned by Deutsche Bank to beat the market on VIP revenue decline, with a 38.9 percent slip in March. Sands China, which according to analysts has the largest proportion of directly managed VIPs in the Macau market, saw a 51.8 percent fall in March VIP table revenue, while Wynn Macau was said to be down 53.3 percent.

Slot revenues for the month were said to be down 32.5 percent for Sands China, 23.8 percent for Wynn Macau and 20.9 percent for MGM China, versus the 24.4 percent decline estimated by the bank for the whole market.

On aggregate across all segments, the best of the three in revenue performance was said to be MGM China, with a March revenue decline of 33.8 percent – versus the whole market’s fall for the month of 39.4 percent. Sands China and Wynn Macau were said by Deutsche Bank to have performed slightly worse than the market, at 41.0 percent and 42.8 percent slippage year-on-year respectively in aggregate March gross revenue.

The Macau government had reported on April 1 that total gross gaming revenue (GGR) in Macau fell 39.4 percent year-on-year in March to approximately MOP21.49 billion (US$2.69 billion) from approximately MOP35.45 billion in March 2014.

It was the 10th straight month of year-on-year decline, weighed down – a range of analysts has said – by factors including China’s anti-corruption drive and reduced liquidity in the mainland property market. Selling real estate is said to be a common way for high rollers to pay off their credit-acquired Macau gambling debts.

Brokerage CIMB Securities Ltd in Hong Kong had said in a note on March 30 that – based on unofficial industry returns for March up to March 29 – it estimated VIP revenue fell 51 percent year-on-year during the month, and that the mass segment declined by 19 percent.