Premium mass “player quality” in Macau for October’s Golden Week holiday period is likely to be only slightly below that of last year, said Credit Suisse AG, citing sources among the city’s gaming player hosts.
“On player quality, we did some checks with the premium mass hosts. They generally mention that the player quality (measured by the spend per player to quality of hotel room) is only marginally lower than last year,” said analysts Kenneth Fong and Isis Wong in a note on Friday.
Macau’s casino industry – battered for 18 months by a combination of policy developments including China’s anti-graft crackdown and a weakening of the underlying Chinese economy – is looking to October’s Golden Week, one of the most important times in the Chinese holiday calendar, for signs of either gambling market stabilisation or improvement.
Mr Fong and Miss Wong said the festive season would be an important indicator for the health of the VIP gambling segment, which has been hit harder than mass-market play by the downturn. Macau junket investor Neptune Group Ltd said in a filing on Friday it might have to reconsider participation in the Macau VIP market if the sector did not improve within a few years.
Lui Che Woo, chairman and founder of Macau casino operator Galaxy Entertainment Group Ltd, one of the local gaming firms most active in the VIP segment, said in an interview broadcast on Friday that he thought Macau gaming had “stabilised”.
Credit Suisse said, referring to Macau junket operator Dore Entertainment Co Ltd, which operates VIP facilities at Wynn Macau casino hotel, and recently announced it had been a victim of internal fraud by a former employee: “The junket business (VIP) remains to be the wild card, especially after the junket Dore incident in which the junket liquidity has been tightened since then. The junkets are preserving more cash at cage for potential redemption and regulators’ intention to step up junket regulation could have hurt depositors’ risk appetite in junket business. While the full impact of the incident can hardly be assessed at the moment, we see Golden Week a key health check to the junket system.”
The Credit Suisse team added in its note, and drawing comparison with another holiday at the beginning of May: “Overall, we are more optimistic on the performance of [the] mass segment in Golden Week. On player count, the strong hotel bookings (better than the Labour Day holiday) should be a good leading indicator.”
According to a recent survey of 21 Macau hotels, advance bookings for the Golden Week holiday period – running from October 1 to 7 – indicated four hotels had been fully booked for the entire period while 10 hotels were fully booked for more than five days of the week. The survey was conducted by the Hong Kong Economic Journal and reported on September 21.
The research indicated the average pricing of rooms was slightly lower than the equivalent period last year.
The average cost of a Macau hotel room was MOP1,512 (US$189) per night in the eight months to August, show data from the Macau Hotel Association. That was a fall of 5.4 percent from the prior-year period.
Macau hotels’ average occupancy rate during the first eight months of 2015 was 83.6 percent, a 7.5-percentage point fall from the 91.1 percent occupancy in the prior-year period.
Another hospitality industry body – the Macau Hoteliers and Innkeepers Association, which mainly represents hotels that don’t have casinos – said it thought an occupancy rate of up to 90 percent was achievable for the city’s hotels during October’s Golden Week, but at a lower average room rate than a year earlier.
“We believe that the city’s 3- to 5-star hotels can see an occupancy rate of 80 to 90 percent for October 1 to 6, when the average room rate offered for the period has gone down by an annual 10 percent,” Chan Chi Kit, president of the association, told Business Daily, a Macau newspaper.
Jul 20, 2018Macau casino operator Galaxy Entertainment Group Ltd (GEG) has started a training programme for about 7,000 of its employees. The firm said it was the biggest occupational qualification programme in...
Jul 20, 2018
Jul 20, 2018
"The [Macau] government has a lead in this subject in regards to what should be done after the [gaming] concessions expire. We will be first listening to what the government will say”
Ambrose So Shu Fai
Vice-chairman and chief executive at Macau casino operator SJM Holdings