Casinos gain as gambling hub Macau stays strong

The rate of growth did ease some — revenue shot up 42 % in 2011 — as China's economy slowed and the country's wealthy gamblers held back amid fears about a crackdown on corruption.

However, analysts noted that the decline in Chinese high rollers, who account for two-thirds of Macau casino revenue, has been offset by growing numbers of middle-class Chinese.

Gambling revenue in Macau has now swept far past Las Vegas, where growth has been flat in recent years. As a result, a number of U.S.-based casino operators are pushing ahead with expansion plans there.

Shares Las Vegas Sand Corp., which earns most of its money in Macau, jumped 5.6 % to us$48.74. The company is currently setting up its fourth hotel casino in Macau. While costs for that project drove down its overall net income by 1 percent in its third quarter, its profit in Macau still rose 17 % to us$326.7 million for the period.
 
Shares of Wynn Resorts, which also earns the bulk of its profits in Macau and has plans for a us$4 billion resort there, jumped more than 5 % to us$118.62 by early afternoon. The company's revenue from the region slipped slightly to us$910.5 million in the third quarter but made up the bulk of its us$1.3 billion company-wide revenue for the period.

And MGM Resorts International recently received approval to build a us$2.5 billion casino resort in Macau, its second for the region. The company reported a larger loss in its most recent quarter due to lower traffic and hotel room rates in Las Vegas. But it has gotten a boost from business in Macau, where revenue increased 7 % in the most recent period. The company's shares gained nearly 5 percent to us$12.22 Wednesday.

The casino companies gained faster than broader markets. The Standard & Poor's 500 index rose 1.8 % Wednesday afternoon.