The recent openings of two major casino resorts in Macau’s Cotai district are providing support to tourist visitor arrival numbers to the city, says U.S.-based Buckingham Research Group Inc.
Visitor arrivals to Macau in September totalled 2.4 million, up 0.5 percent in year-on-year terms, show data disclosed on Monday by the city’s Statistics and Census Service. Tourist arrivals from mainland China rose by 0.3 percent year-on-year to almost 1.6 million in September.
“We would attribute the increase in visitation in September to increases in supply from Wynn Palace and Sands’ Parisian,” Buckingham Research analyst Christopher Jones wrote in a Monday note. He was referring respectively to the recently launched US$4.3-billion Cotai property of Wynn Macau Ltd, inaugurated on August 22; and the new US$2.7-billion Cotai offering from Sands China Ltd, opened on September 13.
In the January to September period, visitor arrivals to Macau totalled 22.9 million, up slightly – by 0.1 percent – year-on-year.
The majority of gamblers in Macau’s casinos are tourists. But several investment analysts have said that headline visitor numbers historically are not directly correlated to overall gaming demand, as gross gaming revenue (GGR) in the Macau market has been typically skewed to high-end play. In addition, according to a survey by the IFT Tourism Research Centre (ITRC), only about 26 percent of visitors to Macau admit to having gambled while there.
The recent increase in visitor arrivals nevertheless coincides with a rebound in GGR. Macau’s casino GGR rose 7.4 percent year-on-year in September, to MOP18.40 billion (US$2.30 billion), announced on October 1 the local regulator, the Gaming Inspection and Coordination Bureau.
The result marked only the second time in 28 months that monthly revenue had not contracted, judged year-on-year. The improvement began in August, when monthly casino GGR expanded by 1.1 percent after 26 straight months of decline.
Following the two consecutive months of GGR expansion judged year-on-year, there has been some optimism among operators and investors that the market decline might be over. MGM China Holdings Ltd co-chairperson Pansy Ho Chiu King said earlier this month that Macau’s casino sector was showing signs of stabilisation. She added at the time: “Not only gaming revenue; [but also] the number of visitor arrivals and consumption demand are stabilising.”
Commenting on the September official tourist arrival figures, brokerage Sanford C. Bernstein Ltd noted that Macau welcomed around 863,000 overnight visitors from mainland China in September, compared to fewer than 715,000 day trippers during the same period.
“The trend keeps positive for Macau as usually overnight visitors were considered more valuable to Macau compared with day trippers,” analysts analysts Vitaly Umansky, Zhen Gong and Yang Xie in a Monday note.
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Analyst at Roth Capital Partners