Macau sees softening of decline

Macau sees softening of decline

Tuesday, May 3, 2016 Totally Gaming
The Chinese province recorded its most promising figures since 2014

Casino operators have seen their share prices rise after Macau posted its most promising gambling figures for almost two years.

The Chinese province posted a year-on-year drop of 9.5 per cent in gambling revenue for April, to about $2.2bn (€1.9bn), according to data from Macau’s Gaming Inspection and Coordination Bureau (DICJ).

While the figures marked a 23rd consecutive monthly decline since China began its anti-corruption campaign, they were better than expected, with analysts having predicted a fall in the region of up to 16 per cent. The single-digit decline also offers a glimmer of hope, considering that Macau’s gambling industry declined by 34.3 per cent over the course of 2015. 

Last month, the DICJ revealed that overall casino gaming revenue for the first quarter of 2016 was at $7bn, down 13.3 per cent from the same period last year. April was the first month - other than February 2016, which included Chinese New Year - since August 2014 in which year-on-year decline was less than 10 per cent.

On the back of the figures, Wynn Resorts saw its share price rise by 6.7 per cent on Monday, with Las Vegas Sands, Melco Crown and MGM Resorts up by 3.9, 3.6 and 1.8 per cent respectively.

CLSA analysts Aaron Fischer and Marcus Liu said they expect Macau’s numbers to “remain lacklustre in the coming months to account for greater cannibalisation of existing properties,” a trend that may gain strength as Macau prepares to welcome two new major properties – Wynn Resorts’ Wynn Palace and Las Vegas Sands’ Parisian Macao – later this year.

TotallyGaming.com says: “Macau’s gaming industry and the global operators who operate in the province will welcome even the merest hint of good news, following two years of big losses. With suggestions that casinos have made a strong start to May, this could signal a plateauing of Macau’s decline.”

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