Macau gaming revenue drops in December by most since March 2016 as security lockdown deters visitors
- Revenue drops 13.7 per cent in December, the most since March 2016, as tighter border controls deter gamblers and visitors
- President Xi Jinping visited Macau in late December as city marked 20th anniversary of handover from Portuguese rule
Gambling revenue in Macau fell in December by the most in nearly four years, as the Chinese city came under a security lockdown ahead of President Xi Jinping’s visit to celebrate the 20th anniversary of its handover from Portuguese rule.
Gross gaming revenue in the world’s biggest gambling hub dropped 13.7 per cent to 22.84 billion patacas (US$2.85 billion) from a year earlier, the steepest since March 2016, according to data published by the Gaming Inspection and Coordination Bureau.
It was a third straight month of declines, though smaller than the median estimate for a 15 per cent drop based on a Bloomberg poll of analysts.
For the full year, revenue was 3.4 per cent lower at 292.5 billion patacas, following two years of gains, amid tepid demand from high rollers amid the US-China trade war and protests in neighbouring Hong Kong.
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Xi visited Macau for three days last month, during which a new government for the administrative region was sworn in. The tighter border security in the build-up was a key reason for December’s muted performance, with visa restrictions keeping many gamblers away.
Despite weaker industry revenues, shares of Macau gaming operators rose by 12 per cent on average in December, according a Bloomberg Intelligence index.
Wynn Macau shares climbed 11.5 per cent, while SJM Holdings advanced 11.2 per cent. The benchmark Hang Seng Index gained 7 per cent that month.
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The latest numbers show continuing pain for casino operators as they faced trade war uncertainty, a slowing Chinese economy, escalating protests in Hong Kong and a crackdown on cross-border gaming that squeezed junkets and the VIP sector. At the same time, rival gaming hubs such as Vietnam are threatening to chip away at Macau’s dominance.
This year may hold better prospects for the operators as new hotel supply and infrastructure improvements kick in. During his visit, Xi urged the city to diversify its economy and carve out a wider role in the Greater Bay Area, a business hub that includes Macau, Hong Kong and nine other cities in Guangdong province.
--With reporting by Reuters, Bloomberg
