Melco bets on higher payout ratio to lift slot machine take

Melco International Development will boost its slot machines business through a loyalty programme and higher than average payout ratio to strengthen its leadership in the Macau market.

Melco, whose core business is gambling and leisure, operated 700 slot machines in Macau and achieved 40 per cent market share by revenue, and 25 per cent market share in terms of the number of machines, managing director Lawrence Ho said yesterday.

The slot machines business generated $63 million revenue in the first six months of this year and earnings before interest, tax, amortisation and depreciation was $32 million, the company revealed in its interim results announcement.

'We will add three to four slot machine halls annually in the next few years,' said Mr Ho. The company will add 250 slot machines in two new venues by the end of this year.

The company will introduce about 4,500 new slot machines in its latest projects, the City of Dreams and Crown Macau, scheduled to open in the next two to three years.

Melco said its average daily net win, measuring the average revenue generated by each machine, increased to about $2,000 last month. For the first six months, the average was $1,800 per machine - about $400 more than the market average. Mr Ho expects the net win per machine will continue to grow.