International edition
October 18, 2021

Thanks to a positive period in the city’s gaming industry

Melco Crown expects revenue jump in Macau

(Macau).- Sustained growth in gambling revenue in Macau in the second half of the year will likely fuel a "big jump" in revenue for Melco Crown Entertainment Ltd, chief executive Lawrence Ho said.


We do expect a big jump in terms of some of our revenues," said Ho in an interview with Reuters Insider.

"I think we'll be able to demonstrate three straight quarters of very stable and consistent earnings," Ho said, referring to a positive stretch since the final quarter last year when the firm made a net loss of us$95.63 million.

Melco Crown is a joint venture between Hong Kong-listed Melco International Development Ltd and Australia's Crown Ltd, but has had patchy quarterly results since opening its flagship us$ 2.1 billion City of Dreams resort last June.

Since July, its shares have outperformed those of Macau peers by around 10 per cent, according to JP Morgan, though analysts have expressed reservations at its hefty debt obligations, its focus on mass market rather than highly lucrative VIP rooms and strategic moves away from non-core gaming into costly mega-shows.

"Downside risk relates to sustainability of market share gains and the relative profitability associated with these share gains," J.P. Morgan analyst Joseph Greff wrote in a report.

Mr Ho declined to give specific figures for the third and fourth quarters as the company is US-listed, although he said its mass and slot market businesses would be ramped up aggressively even as new rivals like Galaxy Entertainment and Las Vegas Sands build major new casino-resorts in the coming year or two.

Declining to give specific visitor projections, Mr Ho said, however, a membership scheme for its casinos would likely expand from 380,000 to 500,000 members by the end of this year.

Melco Crown's bullish outlook comes amid a surge in Macau gambling revenues, that grew 67 per cent in the first half year to us$ US10.7 billion from the same period a year earlier.

While Ho said he expected Macau's gaming revenues to grow over 50 per cent for the entire year, growth next year was expected to slow somewhat from this high base.

"Next year will become more reasonable growth so probably around 15 to 20 per cent," Mr Ho said, who is the son of Macau gambling tycoon Stanley Ho. "You can't really expect this extraordinary type of growth to be persistent always."

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