Posted: 2/20/2013 3:12:11 PM Excellent! Very Good Good Fair Poor Rating: 100% (3 votes) Share on facebookShare on twitterMore Sharing Services
Macau casinos recorded a 3.9-percent drop in gross gaming revenue during the Lunar New Year holidays in comparison with the same festive period one year before, Lusa news agency reports.
Quoting unidentified sources in the gaming industry, Lusa reports that during the first seven days of the Year of the Snake (February 10 to February 16), Macau casinos recorded gross gaming revenue of MOP7.2 billion (US$900 million), down from the MOP7.5 billion recorded in the first seven days of the Year of the Dragon.
Some analysts say that the lower figure was due to softer VIP play, with some high rollers likely to be avoiding the New Year mass market crowds.
Analysts also mentioned poor hold for a few gaming operators on VIP tables throughout the holiday period.
According to Lusa, in the first 17 days of February, the city’s casinos raked in around MOP14.0 billion.
Gross gaming revenue dropped despite the city having recorded 937,000 visitor arrivals from February 9 to February 15 (including non-resident workers and students), marking a growth of 15.4 percent compared with last year’s holiday period, according to the Macau Government Tourist Office.
Among those, close to 630,000 visitors came from the mainland, marking an increase of 25.5 percent.
Based on these trends, several investment banks and brokerage houses have revised downward their February forecasts for Macau’s casino industry. Note that in 2012, the Lunar New Year holiday period fell in January.
Wells Fargo now estimates casino gross gaming revenue growth for February of two to six percent year-on-year, versus a prior estimate of up to 10 percent.
In February last year, Macau’s casino industry reported gross gaming revenue of MOP24.3 billion.
Union Gaming Research noted that lower gross gaming revenue during the Lunar New Year period did not necessarily mean lower profits for gaming operators.
“Given the continued positive mass market inflection, it is important to keep in mind the significantly higher profitability associated with this segment,” Macau-based analysts Grant Govertsen and Felicity Chiang wrote yesterday in a note.
“Throughout the Chinese New Year period, we witnessed table minimums on general mass market floors were generally in a range of 100 percent to 300 percent higher than normal levels,” they added.
U.S.-based brokerage firm Sterne Agee forecasts that casino gross gaming revenue will go up by just 1 percent year-on-year in February.
Hong Kong-based brokerage firm CLSA Asia-Pacific Markets now forecasts February to end up flat, against previous estimates of 11 percent growth, while Citigroup is slightly more bullish – it estimates a 2-percent year-on-year growth rate.
I smell a snake......maybe wrong, but me, being part of the masses has seen time after time where we are led one direction, in this being told the expectations are 10% lower now. Our share price drops, we dump driving price down, the big snakes get a bargain, and then the surprise good news, or better than expected results come, and then the snake sells and starts driving it down again with new bad news.