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July second week revenues soft

Average daily revenues for the past week were around MOP500 million to MOP600 million compared with 630MM MOP the week before, according to Wells Fargo channel checks. 

“We expect additional color in the next few days, and continue forecasting July revenues down 30% to 32% yr/yr,” analyst Cameron McKnight said in a note.

A July decline in revenues at around 30 percent YoY assumes July ADR will trend in line with historical seasonality and takes into account the ramp of Galaxy Phase II, McKnight says.

“In terms of seasonality, July has been approximately 8% higher than June looking at recent averages. June was down 15% sequentially versus May, versus a recent average of around 11%.”

Wells Fargo remains neutral as the market adjusts to a ''new normal'' of tighter government oversight, more muted medium-term industry revenue growth, and a recovery that is likely to be flatter than prior rebounds, the note says.

The note adds that if additional, internal smoking lounges are allowed, they could partially mitigate the effect of the ban on VIP revenues.

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