Macau’s casino gross gaming revenue (GGR) during the recent five-day break encompassing the Labour Day holiday on May 1, was approximately MOP600 million (US$75 million) a day, suggested brokerage Sanford C. Bernstein, and JP Morgan Securities (Asia Pacific) Ltd in respective Monday notes.
The period, referred to by some analysts as ‘May Golden Week’, although that term is not used by the Macau authorities, was “surprisingly golden” in GGR terms, said JP Morgan.
The city’s estimated GGR for the early-May break has been “well above” market expectation, the institution’s analysts DS Kim, Derek Choi, and Livy Lyu remarked in their Monday memo.
“According to our checks, gross gaming revenue for the first nine days of May,” including “Golden Week and four-day seasonal lull,” was MOP4.5 billion, or an average of MOP500 million a day.
“Breaking down further, GGR during the holiday (May 1 to May 5) was a very strong MOP630 million a day,” the JP Morgan analysts suggested.
The institution estimated Macau’s mass GGR recovered to “over 70 percent” and VIP gaming volumes reached “approximately 25 percent” of the early-May break in 2019, when officially the holiday was four days, not five.
This year, the early-May break saw Macau tourist arrivals below one-quarter the level achieved during the 2019 holiday, according to the latest information released by Macao Government Tourism Office (MGTO).
“This reflects a strong rebound in the premium-mass segment and extended length-of-stay, which in turn should alleviate market concerns on potential spillover from VIP on premium mass. Low-end base-mass demand remained subdued given a ban on group tours,” out of mainland China, and restrictions related to Macau-Hong Kong travel, the JP Morgan analysts noted.
They expected Macau’s May GGR to “exceed MOP10 billion”, and expand to “MOP11 billion to MOP12 billion” in July and August – a tally that would be more than 50 percent of 2019 levels.
Sanford Bernstein said in its Monday memo it estimated that on Cotai (pictured) the casino resorts had generated a “much stronger performance” than the gaming properties on Macau peninsula.
“…without IVS”, China’s individual visit scheme exit visa system, “or group visa issuance changes, the opening of Hong Kong, and loosening of Covid[-19] testing requirements for entry [into Macau], GGR and visitation will remain below normal levels and GGR recovery will face headwinds,” Bernstein’s analysts Vitaly Umansky, Louis Li and Kelsey Zhu wrote in the Monday memo.
The Sanford Bernstein analysts said they expected a “more robust GGR uplift” to begin this summer as the city was likely to see further easing of travel rules and a rising number of visitor arrivals.
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