Holiday gamblers boost Macau casinos
Record number of visitors from the mainland during the Lunar New Year sees February gaming revenue rise 11.5pc to 27 billion patacas
Macau casinos took in 27.08 billion patacas in gross gaming revenue last month, up 11.5 per cent year on year as the week-long Lunar New Year holiday on the mainland saw the arrival of large numbers of Chinese gamblers.
The Lunar New Year fell in February this year, while it occurred in January last year.
The accumulated gross gaming revenue for the first two months of this year reached 53.9 billion patacas, an increase of 9.4 per cent over the same period last year, according to statistics from the Gaming Inspection and Coordination Bureau.
Last month's figures beat the estimates of some analysts.
After the holiday season, an initial report from HSBC Global Research said gaming revenues failed to reach its projections. A CLSA research note issued on February 19 said it expected the month to end up flat.
"During the month it looked like February would be quite soft but there was a strong rebound in the VIP segment at the end of the month," said Aaron Fischer, the head of consumer and gaming research at CLSA.
Grant Govertsen, the lead analyst at Macau-based Union Gaming Research, said very strong mainland visitor growth was reflected in strong mass-market gross gaming revenue for the month.
Govertsen said the record levels of mass-market visits had prompted some VIP and premium players to defer their trip to Macau until the week after the Lunar New Year.
Over the 10-day period, from February 7 to 16, total mainland visitors to Macau increased 22.6 per cent to nearly 900,000, a record for a Lunar New Year period, according to a report by Union Gaming.
Fischer said CLSA continued to forecast a growth of 9 per cent for the full year. "We do not expect a fantastic year because of the capacity constraints and also potential concerns over the corruption crackdown that may discourage some marginal VIP customers visiting Macau," he said.
Macau, the world's largest gaming hub, raked in gross gaming revenue of 304.1 billion patacas last year, up 13.5 per cent from 2011.
However, the growth in the most lucrative high-rollers business is slowing down amid the cooling of the mainland economy, Beijing's anti-graft activities and a major central government reshuffle scheduled to begin next week.
Casino shares yesterday outperformed Hong Kong's benchmark Hang Seng Index, which fell 0.61 per cent. MGM China, which has just expanded into the Cotai Strip with a groundbreaking ceremony for a project with 500 gaming tables, rose 2.1 per cent. Melco Crown Entertainment and Wynn Macau edged up slightly. Galaxy Entertainment remained flat, while Sands China lost 0.41 per cent.
Macau's largest casino operator, SJM, which this week reported a rise of 27 per cent in net profit for last year to a record HK$6.75 billion, dropped 0.83 per cent to close at HK$19.22.
A report issued by Haitong International Research set a target price for SJM at HK$24.08. SJM is also working on the development of a Cotai resort, where it wants to operate 700 gaming tables and 1,000 slot machines.