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Macau’s gaming revenue in July fell less than analysts estimated as the holiday season brought tourists and leisure gamblers to the local units of Las Vegas Sands Corp., Wynn Resorts Ltd. and other casinos.
Gross gaming revenue fell 4.5 percent to 17.8 billion patacas ($2.2 billion), marking 26 consecutive months of declines, according to data from Macau’s Gaming Inspection and Coordination Bureau. That followed a 8.5 percent decrease in June and compares with the median estimate of a 5.5 percent drop by nine analysts surveyed by Bloomberg.
Macau’s casinos have been shifting focus to attract more tourists and recreational gamblers as revenue from high-stakes VIP gamblers was stymied by the Chinese government’s crackdown on corruption. The opening of Wynn Macau Ltd.’s Wynn Palace and Sands China Ltd.’s Parisian casino resorts in August and September respectively are being closely watched for their impact on the industry.
“We think the industry is stabilizing” with the new openings by mid-September to attract mass market tourists, Macau legislator Jose Coutinho said in an interview with Bloomberg Television. Macau still has potential to attract Chinese visitors as it’s the closest place to mainland China where gambling is legal, he said.
Macau stocks were mixed in Hong Kong trading, with Sands China up 2.3 percent while Wynn Macau fell 2.2 percent. The benchmark Hang Seng Index rose 1.4 percent, and the Bloomberg Intelligence Macau gaming stocks index was little changed.
Visitor numbers to Macau is beginning to show signs of rebounding and “we’re starting to see gaming revenue declines easing,” said Bloomberg Intelligence analyst Margaret Huang. Monthly casino revenue has also been stabilizing at around the $2 billion a month level and will likely increase in the third quarter with new resorts opening, she said.
Casino billionaire Sheldon Adelson said last week he’s optimistic recreational gamblers and tourists are spurring a recovery in Macau’s hard-hit casinos industry, after Sands China reported mass-market gaming revenue rose in June for the first time in two years. The government is reviewing Sands’s application for gaming tables at the $2.7 billion Parisian that’s scheduled to open Sept. 13.
Macau’s economy is expected to reverse three years of contractions and return to growth in 2017, the city’s Chief Executive Fernando Chui said on July 27. The government wants the casino industry to grow the revenue contribution of their non-gaming facilities such as retail and entertainment, and has set a limit the growth of new gaming tables.
Gaming revenue growth will “finally turn positive by September,” as the new resorts attract players and tourists, said Grant Govertsen, an analyst at Union Gaming Group LLC. “We expect the growth rate to generally remain positive from that point forward after September.”
(Updates with Macau legislator comment in fourth paragraph.)
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