Casino operators focus on Macau as US economy remains stagnant

Cash-rich mainland gamblers, who contribute the bulk of earnings in Macau, have helped the tiny island maintain stellar gaming revenue since the start of the year. Macau's Gaming Inspection and Coordination Bureau reported last week that Gambling revenues in Macau continue to increase at an incredible rate, with year-over-year revenues up 57% in August of 2011. Gambling revenue totaled us$ 3.09 billion in August, despite losses in financial markets around the world.

Macau, a major market for casino operators including Sands China and Wynn Macau, is likely to post full-year revenue more than five times higher than that of rival Las Vegas. After months of positive revenue growth, RBS analyst Philip Tulk said he is raising his brokerage house's estimate for Macau's 2011 gambling revenue by 6 % to us$ 34.1 billion, which would imply year-to-year growth of approximately 45 %.

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MGM Resorts reported second quarter 2011 adjusted loss of 8 cents per share as net revenue surged 17% year over year to us$ 1.81 billion. MGM says the positive result was attributable to the expansion of the company's controlling stake from 50% to 51% in MGM China Holdings Limited when it went public on the Hong Kong stock exchange in June.

Melco Crown Gaming is one of the six companies licensed, through concessions or sub-concessions, to operate casinos in Macau. Net revenue for the second quarter of 2011 was us$ 960 million, representing an increase of approximately 67% from us$ 573.6 million for the comparable period in 2010.