Thanks for sharing the data set drjack. Bain's update this morning suggested Oct will be challenged as to tough 2013 GGR/VIP comps and fat holds last year (no doubt given the HK pizza/pepsi riot and ongoing impairment of VIP based on the corruption crackdown).
But here is the fun part for MPEL:
"October 1 – 19 market share results. According to our checks, October 1 – October 19 table-only market share results are: SJM at 23.0% (vs. September share of ~20.8%), Galaxy at 23.0% (vs. ~22.8), LVS at 23.0% (vs. ~21.8%), MPEL at 15.0% (vs. ~12.6%), WYNN at 7.0% (vs. ~11.1%), and MGM at 9.0% (vs. ~9.0%)."
As drjack noted after his review of Bain's entire report, Bain expects GGR to be down ~22% in a range of 18-23% yoy in his forecast work... As noted in prior threads though, MPEL's business plan has been close to ideal positioning for what is going on with VIP as MPEL is less reliant on VIP than the other U.S. listed companies, including LVS. That mix differential is consistent with MPEL picking up more relative share again Oct 2014 MTD -- while WYNN's share fades and MGM flatlines.
See prior comments on share and mass/VIP implications for MPEL for the Sep Q. The math here is simple, but using Bain's framing with the street est for MPEL at -5% revenue growth for the Sep Q, if they merely continue to run at 60% mass 40% VIP (data for June ytd but likely closer to 65/35 for Sep Q) and Macau's mass is up/VIP is down 15%/-20%,respectively, MPEL should do call it flat GGR for 3Q YOY. Another aspect is that MPEL has consistently outpaced Macau mass numbers for the last two years... again, that would be consistent with MPEL grabbing additional share until VIP returns to a positively sloped trend.
MGM Cotai's "construction" status noted above was updated by Pansy Ho in today's article and underscore how well positioned MPEL is with COD and Studio City's premier entertainment themes "thought of/planned" long before the 4 month of VIP swoon.
Tough times make Macau casinos stronger: Pansy Ho
Pansy Ho Chiu King (pictured), co-chairperson of casino operator MGM China Holdings Ltd, on Friday indicated the downturn in Macau gross gaming revenue (GGR) would help Macau gaming operators become more efficient, more competitive and ultimately make them stronger...
... the focus of the local gaming industry is now changing to complementary offerings – such as entertainment. She said such offerings were likely to be of proportionally greater importance in the upcoming large-scale projects in Cotai than in the existing ones. At the Global Gaming Expo Asia 2014, Ms Ho had said Macau casino operators were “eager” to push for diversification.
On Friday, Ms Ho reiterated that every gaming concessionaire is now planning for more non-gaming investment in the new properties, due to open between 2015 and 2017.
“I’m sure each of us [casino operators] has the intention to follow that route, either alone or in partnership with other entities,” Radio Macau quoted Ms Ho as saying. She did not elaborate.
The Macau government has previously indicated the size of allocation of gaming tables for new projects would be linked to the amount of non-gaming facilities that were built.
Ms Ho also talked about the construction of MGM Cotai, the US$2.9 billion property that the firm is developing. She admitted that labour costs and a shortage of construction workers could put back the opening of the new casino resort, scheduled for 2016. She had already talked about the city’s labour pains in July.
In August, MGM Resorts International, the parent of MGM China, shifted ground on the MGM Cotai opening date, no longer telling investors it expected to open the property “in early 2016"
Some here think australia poses serious competitor to macau for Chinese whales, but as per our counterpoints, we sure do not and neither do the companies doing business there if you study the articles in this thread.
This entire thread is informative for those who want to understand why Chinese VIP play is weak in Australia, but MPEL's own co-chairman James Packer's comments at his separate Crown Resorts annual meeting last week were even more to the point.
Simply put, VIP is a rough go for Crown and everyone else trying to get Asian players to travel to Australia to play... it is just too far, explaining why Crown's numbers on that score continue to be very weak, despite throwing lots of promo money and now some new, longer range jets at the problem. Meanwhile, the rest of his Crown Resorts ebitda continues to be weak sauce and fully explain why he pushed for cash dividends out of MPEL... they need the coin to pursue their efforts at development independent of MPEL's future development plans in Macau, Manila and Japan.
Here's the Australian (newspaper) coverage of these issues from Packer's meeting where he blasted critics and Aussie govt policy shifts undermining his company's new development ideas and rollouts.
goog this title for article:
"James Packer hits out at Crown’s gambling critics, governments"
Good to see him tout the highlights of the MPEL story though... Crown Resorts best asset allocation to be sure, even though 67% earnings growth for 2013 YOY will be subdued when 2014 is done... those with a little forward vision will soon be focused on the easier comps for 2015, especially since Manila and Studio city will both be up and cranking shortly.
This bullmarket f head trying to dis me with his special little girl passive aggressive bs? LOL Read his clueless post above (or anywhere else he posted for that matter) and then read my very civil reply to his bs about LVS on the MPEL board below... seems he doesn't like being confronted with civil, objective information, and cheers the morons trying to ruin this board?
We are pleased that matrix has his new friend, mytek/blacknite/idiotpumer/taho s head who is one of the longtime "bashers" here, making an #$%$ of themselves every post. They both make the guy posting 50 times a day look like a mental giant...
MPEL relative valuation is ridiculous now, and over the near term, what with the Manila rollout coming up within days and before long thereafter first phase of Studio city followed by Tower 5 at COD and boubling ebitda and the company generating best in class adj ebitda relative to footprint, it is likely to resume leadership of the group in terms of relative performance.
MPEL still has $400m of buyback authroization once the blackout (pending manila and 3Q results) is done. Meanwhile, those who can think and actually understand the business learned much from the LVS report last week, as the grind along the bottom winds toward the logical end.
btw, there was nothing on the call to inspire any confidence about Vegas for the "analysts" (e.g., Karen, Robin, McKnight and others who have faded from touting Vegas' "resurgence" until last month when tables games dropped off 12% YOY and slots went to negative YOY. Those reading here (educated guess until Steve's confirmation of fly-ins to Vegas for May and June) with a brain should not be surprised as we've pointed out this dynamic since early last summer.
otp, we are surprised to see WYNN and MGM respond so favorably this morning, since on the face of it, both of those companies but especially MGM does not have the advantaged business mix that MPEL and LVS have positioned on Macau. Perhaps Steve is giving some winks as to their being considerably better than LVS at servicing the quality/big tours and that they are ok on 2Q and fwd, but MGM is not. Oh well... we pulled the MGM (paired) short anyway (no current position other than MPEL now).
Extending that, perhaps it is simple short covering on the part of pm with directional (downside) bets that the smart money realizes are now over and done on the sector, but small cap domestic co BYD's strong rally today is surprising. Perhaps those short BYD don't understand that China's whale play in Vegas from May through July (before vanishing from the scene) was only at WYNN, LVS and Bellagio? BYD doesn't have any Gulfstream jets or pilots on staff, and the Chinese guys don't play in BYD's off strip or Reno casinos last time we checked. LOL
As noted here and on the other post last night, the LVS update, while less than thrilling for LVS longs, was very solid considering all of the bs noise and very real Xi campaign to eradicate corruption from throughout the party ranks (none of which is directed at Macau or gaming per se).
Also great news to hear Bob confirm reports that Xi intends to visit Macau in December, reassuring residents, IR companies, players the street that corrupt govt officials -- not gaming -- is the target. All that is very reassuring for MPEL longs, as the strength of LVS' quarter clearly illustrates no company is better positioned for the current environment in Macau than MPEL.
We are back to 100% long the trading slug again.
LOL at the idiots still wetting themselves here like little girls on AOL this morning. We love having butt wipe bosses paying the s heads for their lame posts as if anyone reading here is going to sell out based on what the cork soakers write here. Too funny...
As you know, we are on the same page goos. See my other thread from the LVS CC and this morning's post above...
yhoo boards chopping today...
GS analyst just got them into a nice conversation on the 19% shopping malls bz noted above. They emphasized the 19% growth is great -- but far from gone feeding that golden goose and more progress to come.
The last question is Shel talking about the corruption investigation involving the narrow portion of govt officials involved in corruption amongst communist party/govt officials and why he said over in december. He clarified that he was basing his remarks on info the govt had disclosed at the time but they are seeking additional clarity and don't know much more than lots of govt officials are being reviewed (Xi's tigers and flies). Shel is throwing around a number -- 7k gov't. officials? -- that are being investigated by the time the review is done in a few more months? Don't know the source of those comments or how objective they are, but fun to listen to, and it seems pretty clear that govt officials won;t be doing much high limit play in Macau anytime soon. LOL Shel concluded that roundabout answer by saying that gaming growth will be back over the next few months, adding; it isn't going away ever.
edited from mbabablitz thread on other board
Relentless bs noise, the HK pizza and coke "riot" and the very real corruption crackdown have hammered the US and HK listed companies, and taken out well over 35% of sector market cap of late... now the big caps are being taken out behind the barn and shot in the head, especially the high fliers NFLX tonight).
As the talking heads and so-called "analysts" have continually issued downcast reports, it is all too familiar to those who have followed the sector over the last several years. We don't currently own LVS, but good to see the results as solid as they are given all the noise from all corners and Xi's witchhunt (see Zhou story from late July through last week)... the entire sellside group was suggesting the stocks were all going down a lot more back in 2009 and then again in 2012 -- right at the bottom then too with MPEL at $13 and LVS at $38.
Bob is currently yawning over the smoking areas... surprise surprise (not)... and he just confirmed Xi is coming to macau in December to express his ongoing commitment and support. Shel just called ot a red herring" with no impact as [respectful, disciplined] chinese visitors to the properties follow rules and do what their govt tells them to do.
If you skimmed past it, check out the Asian malls sales numbers... like Shel said, the massive drop in china's GDP from 7.5% to 7.4% says a lot about the "Sky is Falling" criers on China... not any time soon it seems, a point underscored by the recent jump in Rio's ore shipments/pricing and last month's import/export data and china's big benefit coming from the oil drop. The buyback crank and re-up of $2B and new properties next yr [SC, Parisian, Galaxy] were also highlighted as big factors for new bz/excitement next year.
As typical, LVS had a couple somewhat soft properties vs others and don't expect a big RC turnaround in Macau anytime soon, but overall a solid update for those long the sector. Yawn on the U.S. properties..
A few putzes here without any knowledge of common street terms I have used over time have tried to dis me out of their ridiculous ignorance, but F them. Those who may be concerned about recent and today's volatility and going into LVS conference call tonight might give a quick call to their broker to consider offsetting some or all downside risk on a relatively inexpensive basis (only minimal capital maintenance cost if one has any margin debit) by "boxing" your position. Just be sure to pull the box hedge off once things get going to the upside here
grftt posted an article suggesting some unidentified sources (incl one from mpel? I doubt that attribution is legit and people need to be fired if so) told a reporter for the MDTimes that revenues may be down 10-13% this month YOY and that "profit" might even go flat YOY (presumably meant regarding the 4Q). GW data is done and clean despite the ongoing mess in HK, but it will be no surprise no surprise to see some softness in both mass and VIP on just that alone, i.e., before considering the ongoing Xi campaign to quash out serious corruption (having nothing to do with Macau per se, rather, directed at the individuals involved in bribes and kickbacks stealing China's wealth in such fraudulent transactions and business dealings).
Meanwhile, looking at 3Q, the quant ("math" if one is a putz) for MPEL is a bit different than awful. Last year MPEL was still running about 1/2 of GGR as VIP RCV. YTD June 30, that number was just below 40% -- more "mass" centered than LVS, the big tblower of its own horn on mass emphasis, at ~45%. Now, say VIP this Q is 35% for MPEL, and that chunk of the overall is down 25% for the Q. On the mass chunk, say that is only 65% of the total revenue stream (it may be better), and let's use 12% vs Ho's 15% for overall mass. That would imply GR growth of 0% (not down 10-13% yoy for mpel). And "profit" would be decidedly positive on those components as mass margins smoke VIP metrics...
Lee, who recently opened his own shop (Fundstrat) after years of being JPM's highly ranked ii strategist, is on cnbc discussing how global events over the last 30 days have hammered stocks and have shaken up pm clients, but retains his bullishness and sees a strong run into EOY, maintaining his 2100 broad market target.
Notable is his mow broadcast view that since most funds were already hurting on performance this year (noted a few times here) and given that underlying fundamentals are still supportive of solid growth and rates are not going anywhere fast and gifting entry levels are now available on many sectors and names, he thinks the market is now ready to begin a solid lift into EOY.
Lee has not commented yet, but JPM, WFC and C have all reported solid Q performances and outlooks this morning... JPM and WFC have excellent loan growth -- wow, people putting money to work? -- great tone setting for the broader market as earnings season gets going.
From this one might think the sky is not falling on China's economy, and, derivatively, China's elite wealthy playing VIP tours and direct credit with the Macau complex companies...
Following this news Friday, yesterday China reported surprisingly strong import and export data for Sep -- despite the sharp drop in oil pricing t40d.
On the global growth topic, Germany just now hitting the tape with a drop from 1.8% to 1.2%. Given their heavy trade with Russia, that seems entirely logical... meanwhile MBZ flagship model S class sales led that company's sales to mash expectations. German car makers are doing really well of late as they are the aspirational cars of choice for China's increasingly affluent upper/middle class.
As one of the world's last global footprint banks, also good to see JPM's loan growth up 7% for the Q, with the miss driven by a $1B legal reserve as they start down the Libor fixing and currency litigation problems they created for themselves. WFC, GS and BACto come and hopefully good for tone on U.S equity market.
Following Xi's big splash on going after corrupt officials and executives in late july, one week prior to Ho's reset on mass play expectations for everyone to process, the former head of China's communist party security, Zhou's, subsequent employer were also foamlly charged with fraud over the weekend.
As these "tigers" targeted in the graft campaign hit the headlines, no wonder anyone with any shady background/dealings has shied away from the glare of private clubs, and no mystery now why VIP is down 25% in Macau post the former thoughts of the group CEOs, buyside and sellside analysts as even innocent folks remain in low profile until Xi telegraphs they are done. Who are the 2/3s of players still playing? They must all be "Snow White's" friends and asscoiates with nothing to fear from Xi's "graft crackdown." See full article on Bloomberg.
Agile Tumbles in Hong Kong as Chairman Placed Under Custody
By Bloomberg News Oct 13, 2014 5:18 AM ET
Agile on Oct. 7 said an article on a Chinese website, which linked it to former Chinese security chief Zhou Yongkang who is under investigation for corruption, was groundless and untrue. It said then the report damaged the reputation of the company and it reserved the right to take legal action...
...The article claimed Zhou is the controlling shareholder of Agile, that Agile assisted in money laundering and Zhou had a close relationship with Chan Cheuk-yin, allegations the company said “are totally fabricated.”
President Xi Jinping’s anti-graft campaign reached new heights in late July after the government announced a probe of Zhou, the highest-level corruption investigation since the ruling Communist Party came to power more than 60 years ago.
yeah grftt... agree it will help to have the entire cluster up and running, and the new airport access way done. Solaire's phased opening has been poorly received and clunky for them; COD should be ready to open in a few more weeks which will help them and especially MPEL's story in this fog.
Busy hedging to protect ytd returns and now down to just 40% net long -- our most conservative level since 2009. Given most have awful performance to show, feeling good about with low double digits ytd and will play safe unless things get to ripping into EOY as seen last year with pm playing chase. Now highly focused on just a few names two financials the largest net (and unhedged) longs.
JPM and WFC to the rescue tomorrow for the broader market story? Enough to offset the braodscale negative headlines stuffing FUD everywhere? We'll soon see!
LVS is Wed night... hopefully Shel, Bob stay on the "Macau VIP turaround starting in December" and "mass is the place to be" montras... and then that is followed with Xi's visit and solid outlooks from Steve and Lawrence -- it is going to take more than dividend and buybacks news to get the stocks going hard again.
Another "tiger" snared on Xi's "graft crackdown" causing the VIP low profile in m Some unfamiliar with Xi's graft campaign might read about the "private clubs" Xi has mentioned a few times in recent weeks. Xi's has been critical of private clubs (expensive f&b and women escorts many other articles expand upon) and his "tigers and flies" graft campaign targets govt officials the party knows should not be able to afford being involved in these clubs.
google this for older article re clubs: "BEIJING NOW HAS “MORE THAN 4,000″ PRIVATE CLUBS"
"The former Chinese Communist Party boss of the southern city of Guangzhou has been expelled from the party after being accused of extortion, bribery and "visiting private clubs", state media said on Thursday, the latest official to fall in an anti-graft campaign.
Wan Qingliang was placed under investigation in June on suspicion of "serious disciplinary violations", the usual euphemism for graft.
"Wan Qingliang used his position to seek benefits for others, extorted, received and gave a large amount of bribes ... and many times visited private clubs," the official Xinhua news agency said in a brief report.
Private clubs have been a particular target of President Xi Jinping's sweeping battle against deep-seated corruption due to their reputation in China as places where shady dealings are carried out.
"His aforementioned acts constitute a serious violation of discipline and the law," Xinhua added.
Apart from being expelled from the party, his case has now also been handed over to judicial bodies for prosecution, it said, without elaborating.
It was not possible to reach Wan for comment. He will almost certainly be found guilty as the courts are controlled by the party and generally do not challenge its accusations.
Guangzhou, as capital of the booming and populous southern province of Guangdong, is one of China's most important cities. Provincial party chief Hu Chunhua is a rising star tipped for future national leadership
Li stepping up the public relations effort on reshaping and stabilizing China's economy as they unfold more demand and service based growth. Xi's scheduled Dec visit to Macau will be good PR too.
Chinese Premier Li Keqiang and German Chancellor Angela Merkel attend a China-Germany economic and technological cooperation forum in Berlin, Germany, Oct. 10, 2014.
BERLIN, Oct. 10 (Xinhua) -- Chinese Premier Li Keqiang said here Friday that his country has the conditions and capability to achieve an economic growth of around 7.5 percent this year.
China can keep its economic growth rate within a "reasonable range," he told over 600 officials and business leaders at a China-Germany economic and technological cooperation forum.
A pace around the 7.5 percent target -- whether slightly higher or lower -- will be acceptable as long as employment is guaranteed, household income raised and quality and efficiency improved, added the premier.
Meanwhile, he reaffirmed Beijing's commitment to the opening-up policy, stressing that opening-up is a basic national policy related to China's development and destiny.
China's opening-up policy, he said, is aimed at mutual benefit and all-win results and brings benefits not only to China but also to the whole world.
The premier added that China will open up to the outside world in a more active manner and on even deeper and higher levels and that besides manufacturing the service sector will also be opened at a faster pace.
China, he said, will ensure a normative, fair and transparent business environment and treat Chinese and foreign enterprises equally in terms of market access, policy support and protection of legitimate rights.
Li also told the audience that China and Germany have become a community of intertwined interests with mature bilateral relations and deeply integrated economies.
China and Germany, he added, will keep enhancing their cooperation on innovation in the future, which will create better conditions to boost
Good to see this "noise" suffer a slam ending. UnionPay "fraud" and scaring of China's citizens and unwary US investors was the shouting source of at least 7-8 Shuli Renn and james Detar articles, and even Reuters and Bloomberg went in for a couple of repeats of what the dumbest of the weak analyst group had to say on this topic.
Where is Shuli's "real time market moving news" on this killed topic this morning, coming clean on how lame her reporting was on this? Same for all of the weak analysts calling this a major problem for GGR despite the yawning of Ho, Adelson, Wynn, and Murren?
Speaking of this illustrious analyst group, again, Bain excluded, a few of the little girls here seem to want to hold them out as real seers. LOL All year, despite all their noise on the peanut impact realities of WC, UnionPay fraud, manners graft, Visa pseudo limits, Dragon parades, smoking ban hype, table limits, new constuction/casino floor redos, typhoons, pay hikes, 2 smaller VIP operator frauds, amorphous liquidity concerns for small VIP tours, paid strike demonstrations, and the other 7 noise elements I can't recall offhand, the number of analysts w/IBES BUY or Strong BUY ratings remained unchanged at 20. Great seers alright.
As I squared the facts prior, the consensus remained above $50 until Ho reset expectations on mass gaming heded for a halving growth rate (to mid teens) for the foreseeable future. Prior to that, the street had trouble figuring out that fat holds let LVS and Wynn and MGM skate the weak 2Q and the analysts were slow to learn any of the reality that only a month after that did the private jet flights to Vegas, a couple hundred million worth of tours to Australia, Cambodia and Vietnam (LOL) and then the serious ticket -- "tigers and bears" witchhunt and 33+ suicides following indictments for material fraud commissions -- come into the spotlight as the REAL reason that VIP tours ran at about 3/4s their prior year run rate up through last week.
correction: $20 above is a typo -- we wish we owned the current trading allocation down there... that is presently just thru $29 (excluding hedging offsets).
and no, we have not "laughed" at anyone here other than others joking in civil manner, multialias and other idiots trying to dis quality commentary over time, goofballs attempting to shake out retail shares like it matters to a 7m/day tape here, and the weak and otherwise errant media and analyst coverage over time.
goog the headline for article, but a total of 12 people who were doing the "unauthorized" swipe transactions were involved in the total of 34 cases being prosecuted...
Several media outlets and a few of the analysts following the sector published numerous articles all from March-July -- expanding the FUD on various noise items this year -- on how many billions this would sap out of macau gaming revenue, but while all the FUD they created likely had many would be customers keeping their heads down, it is obvious that on some $22.5B of UnionPay card transactions on macau last year, a "whopping" total of less than .17% of all credit/debit transactions done on UnionPay cards were "unauthorized" as they tried to bypass the govt's required fees per $ spent on the cards.
As noted prior and in the article, a cynic might suggest the reason for the attempts to limit more authorized swipe machines within the casinos is to encourage Integrated Resort customers to patronize Macau's numerous pawnshops and jewelry shops located away from the casino properties.
"Authorities in the city are cracking down on the use of unregistered, hand held card swipe devices. According to the police, the illegal transactions using these devices took place not only at casinos, but also “in restaurants and other establishments” close to gaming venues...
Jewelry and watch shops inside the precincts of the city’s casinos have been banned from applying for new UnionPay swipe terminals since July 1. The existing swipe card devices operated by such shops have not been removed but the Macau government has not excluded that possibility.
Concerns over disruption to the UnionPay system in Macau have been pointed out by investment analysts as headwinds for the mass-market segment of casino gambling."
About that last sentence, scratch this topic from the "noise" pile; and just maybe Xi's scheduled Dec visit will help assuage VIP nerves on the real FUD (vs noise FUD)caused by the "tigers and flies" hunt.
You've had dozens of posts making barebuttbob and mytek.idiotpumper/darknite/tahoejck look like smart guys compared to you. Sad to see you reveal such poor character, really. Your call for $75 last Feb? Your call now for $21?
The record here is clear going back to our original position sold out at $16 on the first run above $15 (it went back to $9 or so), the reload at $13 in late 2012 once Manila funding was arranged without a secondary, the trade sleeves in and out up to $26 in mid summer 2013, our call as a screaming buy risk/reward at $21 in July 2013 where we added to the core (increasing our basis from $13 to $17), the many times we said why we sold out trading positions, hedged our longtime core at $43 (basis $17) back to the 50d ema, covered and rode that back to the top where we sold out the 50d ema reload trading chunk, and then began putting on our present trade sleeve on the way back down... yes, the trading sleeve we now hold below $20 w ave. Latest trades were last week -- shared that here too: added close to $24; wrote some puts (another fun trade for us over time when premium is ridiculously rich) several days ago... we'll comfortably add any shares assigned from those as they will be below $24 cost net).