Macau: Gaming revenue to grow almost 40%

A well-informed source told the Macau Daily Times that by last week gaming revenue for last month had almost crossed us$ 1.85 billion. “The numbers were already very close to the us$ 1.85 billion-mark by September 29,” he said. “Casinos might pocket something between us$ 1.85 billion to us$ 1.91 billion. in September,” the source added.

Adding to the us$ 14.5 billion registered by August, casino revenues for the  first nine months will be between us$ 164.1 to us$ 16.4 billion, according to the numbers provided to MDT.

In comparison with the same month of last year (us$ 1,351), revenues will likely grow around 37 %, which will be the lowest monthly increase so far in 2010. If the figures do follow the source’s expectations, annual growth will drop from 63.2 % in August to 59.72 %. Either way, it will always be a new annual record. However, this week JP Morgan came out with some fairly cautious comments on Macau gaming revenue growth rates.

Total gaming revenue for Macau up to September 26 comes in at approximately us$ 1.61 billion, according to JP Morgan, cited by iStockAnalyst.com. Given that there was no weekend till the end of the month, JP Morgan expects September gaming revenue to end at around us$ 1.79 billion, which would be below market expectation of us$ 1.85 billion us$ 1.91 billion.

JP Morgan recalls that the run-rate for the first two weeks of September was us$ 1.95 billion, but the revenue momentum actually saw some slowdown over the second half of the month.

Analysts believe a slower September is natural, especially in the last two weeks, due to the pre-national holiday slowdown that we might expect to see in a normal year. Up to September 26, Stanley Ho Hung Sun’s Sociedade de Jogos de Macau saw its market share increase from 29.8 % in August to 31.1 %, JP Morgan assumed. Sands China registered a slight increase to 19.8 % from 19.3 %, while Melco Crown strengthen the third position, climbing from 16.2 % to 16.8 %.

As expected, Wynn Macau kept losing market share and it was overthrown from the fourth position of the ranking by Galaxy Entertainment, a company that is also on the down curve. Up to last Sunday, Galaxy had 12.7 % of market share (down from 13.1 %), whereas Wynn Macau dropped from 13.9 % in August to 10.4 %.

MGM Macau, a joint venture between Pansy Ho and MGM Resorts International, continues in the last position, but it kept the growing trend from the previous month, jumping from 7.6 % to 9.2 %.

According to JP Morgan, several operators have been more aggressively building up their VIP franchises and this may have possibly led to some market share loss at Wynn Macau. Other analysts believe junket operators are now taking some business away from Wynn Macau to its competitors. Earlier this month, Deutsche Bank’s Karen Tang said that if two influential junkets moved half of their monthly roll, Wynn Macau would lose three percentage points of market share.