Deutsche Bank estimates Macau November GGR to drop 27.5 percent

Wednesday 4th of November 2015

Deutsche Bank estimates November gross gaming revenue to decline 27.5 percent year-on-year, underpinned by a 35.1 percent decline in VIP revenue and a 16.2 percent decline in the mass market segment, inclusive of slots.

DB said in a note that its expectation for a 35.1 percent VIP revenue decline is predicated on a 50.0 percent drop in VIP rolling chip volume and hold of 4.17 percent.

For the mass segment, a 16.2 percent decline in the mass market assumes a 17 percent decline in mass table revenue and an 8.5 percent decline in slot revenue.

Mass table revenue per day in November, on a sequential basis, is estimated to be down 5.4 percent relative to October.

Following October’s gaming revenue drop of 28.4 percent in October to MOP20 billion ($2.5 billion), DB said “October results represented limited change in our view.”

“While headline results were modestly better, two year compares were broadly worse across the board in almost every segment.”

The note adds that Studio City, which opened on October 27, generated $6 million in gross gaming revenue at its mass tables in the period.

“If we were to extrapolate the daily results, and assume the contribution is purely incremental, the $440 mm run rate would add 1.6% to annual revenue at the current market run rate pace.”

“To put this in perspective, we note that the 200 table allocation adds 3% to market table capacity and the 1,600 hotel rooms adds 5% to hotel capacity.”