Gaming | Bernstein: ‘disappointing’ GGR over holidays

A croupier arranges cards on a baccarat table inside the Broadway Macau casino, developed by Galaxy Entertainment Group Ltd., in Macau, China, on Tuesday, May 26, 2015. Galaxy’s new properties, Galaxy Macau Phase 2 and Broadway Macau, are scheduled to start running on May 27. Photographer: Billy H.C. Kwok/Bloomberg

The total gross gaming revenue (GGR) for traditionally one of the busiest periods in the gaming calendar has plunged 76% year-on-year, which analysts have dubbed as disappointing.
“At this stage, we estimate [that] October [will] see a [GGR] decline of maybe 70 percent” from the prior-year period, according to a note from Sanford C. Bernstein Ltd., as cited by GGRAsia.
“This is largely tied to visa processing and visitation and the severity of any liquidity constraints which remain largely uncertain.”
The company added that things could improve over the next couple of months, citing measures that simplify the process of incoming tourists.
“The key will be the simplification of the visa process (which is currently taking up to two weeks to process), and perhaps the elimination of the Covid-19 test requirement.”
According to the group’s channel checks, the city’s GGR recorded a total of 1.95 billion patacas, implying that it saw a daily average rate of 279 million patacas during the national holiday.
However, the figure was already up by 279% when compared to the previous month, according to analysts Vitaly Umansky, Tianjiao Yu and Kelsey Zhu.
Golden Week visitors to the SAR only totaled to over 156,000 visitors, a drop of 86.0% compared to the 985,000 visitors during the week spanning October 1 to 7. This marked the 2019 peak for gross gaming revenue with some 26.4 billion patacas wagered in Macau’s casinos.
The lack of recovery for Macau during the seven-day national holiday – particularly the slow movement of gambling activity, has led to other analysts predicting that it may be as far into the future as 2022 before GGR figures return to pre-coronavirus highs.
This means that Macau has to weather the economic downturn for another year.
“We were overly hopeful about the prospect of pent-
up demand, which we thought would outweigh the nuisances related to travel arrangement to Macau and stricter capital control,” said JP Morgan analysts.
“A broadening clampdown on illegal/overseas gambling in China is creating jitters among agents/players at unprecedented levels, in turn throttling any VIP/high-end demand recovery (which, by the way, was touted and supposed to lead the initial rebound),” the group added.
With no upcoming major holiday in the next few weeks, the gaming sector as well as businesses still remain uncertain about recovery.
As previously reported by the Times, the health of the economy now depends entirely on mainland visitors and their willingness to visit. However, the figures revealed over the holidays as well as since the resumption of the Individual Visit Scheme is somewhat still below the expectations of analysts.