Gaming | VIP Q1 GGR outperforms brokerages’ projections

The VIP segment raked in approximately MOP9.13 billion in the first quarter (Q1) of 2021, up 19.7% quarter-to-quarter, the Gaming Inspection and Coordination Bureau revealed. The actual VIP performance surpassed projections by banking groups.
During the first three months of 2021, the VIP sector accounted for 38.6% of the aggregate casino gross gaming revenue (GGR), up 3.7 percentage points from the previous quarter, yet down 10.0 percentage points year-on-year.
The VIP GGR in this quarter is equivalent to 24.5% of 2019, totaling to MOP37.2 billion — which fares slightly better than the forecast by the international investment banking group JP Morgan, of around 19% of pre-Covid level.
The 19.7% quarterly increase in VIP GGR in Q1 2021 also bucked the projection of another separate banking enterprise, Morgan Stanley, which stated earlier that the VIP revenue would decline by “3% quarter-on-quarter to USD0.6 billion.”
Prior to the release of VIP gaming statistics, JP Morgan issued a statement on April 14, in which it regarded Macau’s VIP casino sector as “bad,” since it “showed little sign of improvement despite border opening last year.”
The growth of VIP GGR has been suppressed by “supply-side issues”, including a series of reforms and clampdowns imposed by the Chinese government that have been hamstringing “junkets’ ability to engage with players and provide liquidity,” JP Morgan explained.
Whilst the VIP segment has been sluggish since the Covid-19 outbreak, the mass GGR has gained much momentum.
According to the official data, the mass market generated MOP14.5 billion during Q1 2021, climbing modestly by 2.15% from the last quarter.
In terms of proportion, the mass share segment accounted for 61.4% of total casino GGR, which showed a 10 percentage points increase year-over-year, yet down 3.7 percentage points from the previous quarter.
The mass GGR stood at 37.3% of the barometer in Q1 2019 — approximating pre-pandemic levels.
JP Morgan has been sanguine about the mass market. It is anticipating a greater momentum in rebounding into the second quarter and beyond, driven by several favorable factors such as a rapid revival of China’s outbound tourism market during the Ching Ming Festival, and a “stabilizing Covid-19 situation in Hong Kong.”
Overall, Macau registered MOP23.6 billion in total GGR in the first quarter, up 8.3% quarter-over-quarter, yet down 22.5% compared to the same period last year.