Macau posts record gambling revenue for October
A record gambling take during the holiday month is attributed to growth in the mass market middle-class sector and table efficiency
Gambling revenue in Macau rose 3.2 per cent last month year on year to a record high, buoyed by an eight-day National Day holiday during which mainland gamblers flocked to bet in the world's largest casino hub.
October's revenue of 27.7 billion patacas was the strongest monthly figure in Macau's history, though the pace of growth was actually the second lowest for the year and slightly higher than the 1.5 per cent growth in July. The former record of 26.85 billion patacas was set in October last year.
"The opening of new projects this year, strong mass-market revenue growth, casinos' improvement in table efficiency all speak to the record gaming revenue," said Chelsey Tam, an analyst at financial services firm Emperor Securities.
Aaron Fischer, head of consumer and gaming research with CLSA, said the monthly growth is slightly above his expectations. "We expected 2 per cent growth."
"The fact that October was an all-time record should dispel any panic," Fischer said.
Macau has been plagued by concerns this year that a slowing in the mainland economy will drag down the island's revenues.
The imminent power transition in Beijing has cast uncertainty over the future policy towards the gaming destination and has kept away many cash-rich Chinese from the gaming tables. However, while wealthy high-rollers have cut down their expenses, the mass-market that caters for middle-class tourists has witnessed impressive growth.
Tam said a rebound in VIP revenue growth is likely in the final quarter of the year, adding that she expects "the announcements of more accommodative monetary policies and expansionary fiscal policies after the 18th Party Congress", which should bode well for consumer confidence.
Not everybody is as optimistic. Deutsche Bank recently revised down its 2013 forecasts for Macau's casino revenue growth to 7 per cent from 11 per cent.
Over 1.05 million travellers visited Macau during the holiday in the first week of October, up 7 per cent from the same period last year, according to official data.
In October, the Macau government approved land concession contracts for the Chinese arm of MGM Resorts, MGM China, and local player SJM, opening the door for them to expand to the Cotai Strip against rivals Sands China and Galaxy Entertainment.
Macau gaming shares rose in Hong Kong trading yesterday on the better-than-expected monthly results. Sands China was up 2.9 per cent and Wynn Macau up 2.7 while the Hang Seng Index rose 0.8 per cent.