Big spending holiday punters deal Macau a new record in gaming revenues

Revenue soars 40pc last month, bolstered by influx of mainlanders over Lunar New Year

PUBLISHED : Tuesday, 04 March, 2014, 5:09am
UPDATED : Tuesday, 04 March, 2014, 5:19pm

Casino revenue in Macau jumped 40.3 per cent year on year to a record 38 billion patacas last month, bolstered by a week-long Lunar New Year holiday that showed demand from the mainland remains strong.

The city's Gaming Inspection and Co-ordination Bureau said gaming revenue beat the previous record of 36.5 billion patacas set in October - including the week-long National Day holiday - and also topped the 36 billion patacas median estimate of analysts polled by Bloomberg.

"This was the fastest rate of growth since October 2011 at 42.3 per cent," said Grant Govertsen, lead analyst at Macau-based Union Gaming Research.

More than 770,000 mainland visitors travelled to the world's biggest gaming hub during the Lunar New Year holiday from January 31 to February 6, up 23 per cent year on year, the Macau Government Tourist Office said.

In the first two months of this year, Macau has reported total gaming revenue of 66.7 billion patacas, more than last year's annual revenue in Las Vegas.

Gaming revenue growth averaged 23.7 per cent year on year over those two months.

"This is well in advance of our current 14 per cent growth forecast for the entire year," Govertsen wrote in a report.

Three casino operators' shares rose yesterday and three fell. SJM Holdings advanced 2 per cent, Wynn Macau was up 0.8 per cent and MGM China rose 0.5 per cent. Galaxy Entertainment dropped 2.2 per cent, Sands China was down 1.4 per cent and Melco Crown Entertainment fell 0.8 per cent. The benchmark Hang Seng Index dipped 1.5 per cent yesterday.

"Shares of the Cotai-centric operators are down, while those with peninsula-only exposure are up," Union Gaming said.

Govertsen said that was because of comments made by Francis Tam Pak-yuen, Macau's Secretary for Economics and Finance, even though he repeated views expressed before. Tam said the government would not grant all the tables each project had requested.

Govertsen said Tam's comments were likely weighing on shares of the Cotai-centric operators as they had a bigger share of Macau's gaming tables than the peninsula-only operators and could potentially be unlucky when it came to the allocation of new tables.

"However, we continue to believe that all operators will receive enough tables to generate adequate returns on investment."

The Macau government has been encouraging casino companies to offer more non-gaming facilities to help the economy diversify and reduce its reliance on gaming.