UBS says no clear signs of recovery in May

The drop in Macau’s gross gambling revenue is expected to moderate slightly in May, but there are still no clear signs of recovery, UBS analyst Anthony Wong wrote in a note.

He said May GGR has been around MOP730 million ($91.4 million), up from MOP690 million and MOP640 million in March and April respectively. However, the increase is mainly due to the Chinese holidays at the beginning of the month and that pace is likely to moderate going forward.

Wong expects the May total to show a drop of between 34 percent and 38 percent, slightly better than the 39 percent decline seen in April.

Mass revenue is likely to be down 20 percent to 25 percent year-on-year, with a VIP plunge of between 42 percent and 47 percent. However, on a sequential basis, Wong said both mass and VIP revenue may have slowed from the first quarter.

“We believe there have been no clear signs of sequential demand recovery, which is assumed in current consensus forecasts,” he said.

 

Commenting on the table allocations for Galaxy Entertainment’s new Macau Phase 2 and Broadway Macau, which are scheduled to open before the end of the month, he says the market is expecting them to receive 150. An allocation below that level will be negative to the market, he says.

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