The respective bosses of Macau casino operators SJM Holdings Ltd and Melco Crown Entertainment Ltd expect the city’s gaming sector to see positive growth in casino gross gaming revenue (GGR) in calendar year 2017.
SJM Holdings’ chief executive, Ambrose So Shu Fai, said overall casino GGR in Macau for full 2017 should increase by about 10 percent year-on-year. Mr So told reporters that the VIP and mass market gaming segments were each likely to contribute to such expansion.
He cautioned, however, that what he referred to as recovery in Macau’s gaming sector would take time.
The chairman and chief executive of Melco Crown, Lawrence Ho Yau Lung, said he expected year-on-year GGR growth in 2017 to range between 5 percent and 9 percent, Chinese-language newspaper Macao Daily News reported. The Nasdaq-listed gaming operator is also known by its stock ticker name MPEL.
The respective comments by Mr So and Mr Ho were made in Beijing over the weekend. The two casino executives are in the Chinese capital attending the annual meeting of the Chinese People’s Political Consultative Conference. Mr So and Mr Ho are Macau delegates to China’s top political advisory body.
Macau’s accumulated casino GGR for full-year 2016 fell 3.3 percent compared to the tally for 2015, according to data released on January 1 by the city’s regulator, the Gaming Inspection and Coordination Bureau. It meant Macau has experienced three consecutive years of annual GGR decline: in 2015, GGR had fallen 34.3 percent; in 2014, it slipped 2.6 percent year-on-year.
Despite 2016’s annual year-on-year GGR contraction – against a significantly diminished base of Macau GGR over the previous two years – the final five months of 2016 registered consecutive year-on-year improvements in the monthly tally of GGR.
In a February report, Japanese brokerage Nomura said it expected the compound annual growth rate of the city’s mass-market table games GGR to be 7 percentage points higher than that for VIP table games in the 2017 to 2019 period, at 9 percent compared to 2 percent for the high roller business.
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"VIP growth [in Macau] is roaring back on the heels of last year’s economic stimulus – but we think this could stall once the effect of the stimulus and the Chinese housing bubble wears off – as it did in 2013-14"
Cameron McKnight and Robert Shore
Analysts at Wells Fargo Securities