China’s autumn holiday period encompassing National Day on October 1 was for Macau casinos a “not-so-golden Golden Week – as expected”.
So said a Tuesday note from JP Morgan Securities (Asia Pacific) Ltd, referring to the name given to the week-long holiday that this year ran from October 1 to October 7. The period typically seeks a spike in casino gross gaming revenue in the city, but trading conditions have – according to commentators – been facing headwinds from the mainland and Macau authorities’ greater scrutiny of VIP junkets, and the United States-China trade war.
“Golden week demand was unexciting, as well as expected,” said the JP Morgan memo from analysts DS Kim, Jeremy An and Derek Choi.
“According to our checks, the seven-day Golden Week generated average daily revenue of about MOP1.15 billion [US$142.3 million] per day (October 1-7), implying a 12 percent decline from last year’s approximately MOP1.3 billion per day.”
They added: “But recall that last October [2018] had a (very) uneven base with a strong start from Golden Week versus a weak finish, partly due to President Xi’s visit to [Guangdong Province, neighbouring Macau] towards the end of the month.”
Brokerage Nomura estimated in a Tuesday memo by Harry Curtis, Daniel Adam and Brian Dobson, that Golden Week performance by segment produced average daily mass revenues that were up approximatelyy 8 percent to 10 percent year-on-year, but with VIP volume growth tracking “approximately 22 percent to 24 percent lower than the same period last year”.
Another brokerage, Sanford C. Bernstein Ltd, stated: “As we have expected, based on conversations with industry participants, higher-end play was tepid during Golden week, and will likely remain so for the rest of October (although the year-on-year decline should improve).”
The institution’s analysts Vitaly Umansky, Eunice Lee and Kelsey Zhu added: “While hotel bookings were solid, the quality of the customers has been lower (i.e., lower spend per head) this year.”
