Little sign of recovery as gaming revenue falls 90% in Sept

Billy H.C. Kwok/Bloomberg

Macau gaming revenue showed little sign of improvement, notching a sixth straight month of declines of at least 90%, as a gradual relaxation of travel and visa curbs by China has so far brought few visitors.

Gross gaming revenue fell 90% to 2.21 billion patacas ($277 million) in September from a year earlier, according to data from the Gaming Inspection & Coordination Bureau today (Thursday). That was worse than the median analyst estimate for an 86% decline.
Key insights

• Macau has seen only a trickle of arrivals even though visas have been made available to residents in China’s Guangdong province — which previously accounted for a third of Macau’s visitors — since late August.
• Casino floors have remained largely empty as inconvenient requirements still make it difficult to enter Macau from the mainland, such as obtaining a negative virus test. Other destinations such as Hainan are proving a draw for Chinese travelers with such perks as duty-free shopping.
• Macau also faces challenges as China is tightening controls on outbound capital flow. Liquidity continues to be tight in the enclave, with junkets seeing capital withdrawals.
• Macau trails other gambling hubs in bouncing back from Covid-19. The Las Vegas Strip, for example, saw gaming revenue recover to 60% of last year’s level in July after casinos gradually began reopening in early June.
• The industry expects gaming revenue during China’s Golden Week, which started Thursday, to be about 30%-50% of last year’s level, said Linda Chen, vice chairman of Wynn Macau Ltd.

Market performance

• The Bloomberg Intelligence index of Macau casino operators dropped 15% in September amid the slow pace of recovery and analyst downgrades. The benchmark Hang Seng Index fell 6.8% in the same period.