The former Portuguese colony of Macau generates about six times the gambling revenue of Las Vegas and now a Macau-based company is going after a piece of the action. U.S.-based casino operators are reaping some benefits, too.
The privately held Macau company, SJM Holdings Ltd., has announced a new partnership with Italy’s Gianni Versace SpA for a new hotel on Macau to be called the Palazzo Versace and to be designed by Versace fashion house. It is part of a $3.22 billion project that will ultimately include 700 gaming tables and 2,000 hotel rooms, and is scheduled to open in 2017.
U.S.-based casino operators Las Vegas Sands Inc. (LVS), Wynn Resorts Ltd. (WYNN), and MGM Resorts International (MGM) already operate resorts and casinos in Macau and these companies would be much smaller without them.
At Las Vegas Sands, for instance, Las Vegas properties generated $346 million in second quarter revenues compared with $895 million at just one of its Macau properties. The story is similar at Wynn Resorts, where the company’s second quarter revenues in Macau topped $930 million compared with $401 million in Las Vegas.
At MGM, the company’s MGM China subsidiary reported revenues of $835 million and 51% of net income in the second quarter.
A new casino and resort on Macau are not depressing U.S.-traded casino stocks. Quite the reverse, in fact -- all three have posted new 52-week highs today.
MGM International’s shares are up about 2.2% at $18.80 after posting a new 52-week high of $18.89. The 52-week low is $9.15.
Wynn Resorts has also posted a new 52-week high of $146.35 and is now trading up 2% at $146.28. The 52-week low is $102.29.
Las Vegas Sands posted a new 52-week high of $61.35 and is now trading up nearly 3.5% at $61.28. The 52-week low is $40.28.
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