Visitor numbers key to GGR health in Macau, analyst says

The number of visitors arriving in Macau is becoming an increasingly important indicator of the state of health of the territory’s gambling industry as the mass market grows, Sterne Agee said in a note.

April visitation was up 10 percent year-on-year, partially driven by a 9 percent increase in tourists from Hong Kong. It was the first year-on-year increase in HK visitors to Macau since last September and was probably influenced by the timing of the Easter holiday. Mainland visitation was up 14 percent and represented 66 percent of the total. HK represented 20 percent of the total.

“We believe visitation is emerging as an increasingly important indicator to the health/growth of Macau as the Island becomes more reliant on mass gaming revenue (and less reliant on VIP), as well as ahead of significant supply increases,” the note said.

The share of VIP baccarat to the market as a whole has dropped to about 63.6 percent, according to Bloomberg Research.

The firm also estimated that monthly table-only gross gaming revenue was about MOP26.3 billion ($3.3) through to May 25th. The run rate is an increase of about 15 percent year-over-year, Sterne Agee said, adding that it reconfirms its May year-on-year outlook for growth of between 12 percent and 17 percent. Last week’s average daily table GGR was up 12 percent from the previous week and flat with the May daily average.

SJM Holdings retained its lead in terms of market share at 23.3 percent on a table only basis, down from 25.3 percent the prior month. Las Vegas Sands was second with its share gaining to 23.2 percent from 21.8 percent. Galaxy Entertainment’s share was up to 21.6 percent from 19.1 percent, while Melco Crown fell to 12.2 percent from 14 percent, Wynn Resorts was little changed at 10.9 percent and MGM Macau slipped to 8.8 percent from 9.2 percent.

 

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