Gaming | June GGR lowest in H1, still better than expected: JP Morgan

Macau recorded the lowest gross gaming revenue (GGR) monthly figure in the first half (H1) of this year for June, reaching only MOP6.54 billion, down 37.4% from the period’s peak of MOP10.45 billion in the preceding month, according to the Gaming Inspection and Coordination Bureau.
In a statement published yesterday, JP Morgan reflected that despite the sharp fall in June the number is still “better than feared,” and reaffirmed its confidence in Macau.
The daily GGR run-rate for June dropped month-over-month for the first time in seven months, down 37% to MOP218 million per day, the lowest number since October 2020, according to the brokerage firm.
The “poor revenue” in GGR for June was deemed unsurprising, given the resurgence of the Covid-19 pandemic in Guangdong province and ensuing cross-
border travel restrictions that hindered Macau’s gaming business to some extent last month.
Guangdong province plays a pivotal role in driving the city’s GGR as it is “the single largest feeder market,” contributing on average 55% of the city’s arrivals this year. In addition, the region is considered a “main gateway” to Macau, with over 90% of mainland arrivals entering via Zhuhai.
JP Morgan noted that, notwithstanding this’s month drop, the second quarter (Q2) of this year “still managed to print the highest GGR since the pandemic,” — with a significant boost by “solid recovery in mass [market],” and “robust” May GGR of MOP10.45 billion which is by far the highest tally in H1.
Overall, the GGR for Q2 increased 7% from the first quarter to MOP25.4 billion, equivalent to MOP279 million/day or 35% of 2019 levels.
Broken down into segments, the mass market GGR is expected to have grown 13% quarter-to-quarter in Q2, which translates to around 45% of the level in the same period in 2019, and “a further recovery from around 40% in Q1,” JP Morgan said.
Meanwhile, the GGR for the VIP segment shows no advancement in Q2, standing at “only approximately 20% recovery levels,” the same as that in the first quarter.
The government yesterday announced more particulars about the upcoming reinstatement of the Hong Kong-Macau border and confirmed that Hong Kong travelers will be barred from engaging in some mask-off activities upon arrival, such as using swimming pools, karaoke parlors, and so on.
Despite the proposed new scheme, JP Morgan confirmed that its GGR forecast was “unchanged given the unpredictability of these policy measures.”
GGR is forecast to stand at MOP8.5-9.0 billion in July, representing 35% of pre-pandemic levels, and MOP 10.5-11.5 billion in August, or 45% of pre-pandemic levels, even higher than numbers in May.