Macau Gaming Revenue Growth Beats Estimates as New Resorts Open
(Bloomberg) -- Macau’s gaming revenue swelled more than estimated in September, with new casino projects from the local units of Las Vegas Sands Corp. and Wynn Resorts Ltd. helping draw recreational gamblers.
Gross gaming revenue rose 7.4 percent to 18.4 billion patacas ($2.3,billion), according to Macau’s Gaming Inspection and Coordination Bureau. That followed a 1.1 percent increase in August, after a 26-month slump, and compares with the median estimate for a 4 percent advance in a Bloomberg survey of nine analysts.
Macau, the only place in China where casinos are legal, is in the process of transforming itself into a tourist destination after Chinese President Xi Jinping ordered the city to diversify its economy from gambling in late 2014. In response, casino operators have been building resorts with more non-gambling features in Macau’s Cotai Strip. These include Wynn Palace, which opened in August, and Sands’s Parisian which debuted last month.
“In September we had the benefit of recent openings such as Wynn Palace and the Parisian,” Aaron Fischer, an analyst at CLSA Ltd., said before the data was released. “There’s been a shortage of hotel rooms and the new properties are adding to capacity.”
The casino industry is bracing for a possible visit in October by Premier Li Keqiang, with analysts warning that the nascent recovery may be threatened by his appearance in the former Portuguese colony to attend a conference of ministers from China and Portuguese-speaking countries.
A visit by Li “could potentially result” in gaming revenue returning to negative growth in October, said Grant Govertsen, a Macau-based analyst at Union Gaming. The impact is expected to be felt “exclusively at the high-end of the market,” he said.
Accumulated gross revenue from January to September fell 7.5 percent from a year ago period, Macau’s Gaming Inspection Bureau said.
With assistance from Lisa Pham