Casino revenue in Macau increased in December, extending the industry’s recovery to a fifth month as the Chinese gambling hub’s efforts to reinvent itself drew more tourists from beyond China.
Gross gaming revenue rose 8 percent from a year earlier to MOP19.8 billion (USD2.48 billion), according to data from Macau’s Gaming Inspection and Coordination Bureau, following a 14.4 percent increase in November.
For the full year, casino revenue fell 3.3 percent to MOP223.2 billion, easing from the 34.3 percent drop recorded in 2015. Analysts surveyed by Bloomberg expect a 7 percent increase in gambling revenue in 2017, in a recovery led by mass-market players.
“We continue to believe that while the market is stabilizing, we won’t see a v-shaped recovery like we did in 2010 and 2013,” Wells Fargo Securities’ Cameron McKnight wrote in a note before the release. The analyst cited macroeconomic and policy as among the risks facing Macau in the near term, along with new supply of casinos being planned by operators.
Macau is increasing its oversight of gambling after China’s anti-corruption campaign scared off high-stakes VIP bettors, causing a steep casino downturn since mid-2014. Operators such as Las Vegas Sands Corp. and Wynn Resorts Ltd. have since opened resorts with more tourist-friendly features, sparking a rise in visitors from countries such as South Korea, Japan and the U.S. even as arrivals from China slipped.
Property tightening measures by China’s government to cool the overheated market may also be affecting gambling in Macau, according to Vitaly Umansky, an analyst at Sanford C. Bernstein & Co. “We expected the cooling real estate market may bring some headwinds on the Macau VIP sector,” he wrote.
Macau had snapped a two-year economic contraction in the third quarter, with gross domestic product growing 4 percent from a year earlier, amid the recovery in gaming revenue. Lisa Pham, Daniela Wei, Bloomberg
No Comments