Macau’s recovery is set to continue amid discussions on broader macroeconomic issues in China, according to Hubert Wang, president and chief operating officer of MGM China.
In an earnings call with analysts, the executive pointed to the government’s gross gaming revenue (GGR) of MOP216 billion in 2024, which is “is quite consistent with our belief, our own expectation and the market consensus as well.”
China is currently experiencing a softening in its overall macroeconomic situation.
The GDP growth is around 4% to 5%, a trough when considered in a long-term context.
“But I believe that Macau is not merely a reflection of the average GDP growth or spending patterns in China. As a town, we cater to about 30 million visitations a year. The unique visitation figures are probably less than half of that,” said Wang.
“It’s still a very small number in the grand scheme of population in China. I would say we cater to the middle and upper middle classes in China,” he added.
For Wang, Macau is positioned to cater to groups with high spending habits. He added that the government and concessions are aligned in their efforts to attract this market share through incentives.
During the third quarter, MGM’s net revenue grew by 10% to HKD6.4 billion compared to 2019, with an adjusted EBITDA of HKD1.9 billion (equivalent to 122% of 2019), consistently outperforming the market.
In the same earnings call, Bill Hornbuckle, chief executive officer and president of MGM Resorts, expressed confidence in the Macau market as the third quarter net revenue adjusted property EBITDA surpassed that of 2019 figures and adjusted property EBITDAR mass GGR and visitation.
“In the Macau market, it is evident that business is booming,” said Hornbuckle.
“To kick off the fourth quarter, we had an amazing Golden Week that led to a market share for October of over 15% and an all-time record adjusted property EBITDAR for the month,” he added.
The group is currently laser-focused on three key priorities, being, “making opportunistic changes to our casino floor and existing room products to maximize yield, taking care of our mass and premium mass customers, and driving international tourism.”
At MGM Cotai, the group will also start remodeling its platinum area for completion early next year. At the MGM Macau, the gaming operator has begun planning a villa upgrade and the addition of six new villas.
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