nion Gaming thinks margins on earnings before interest, taxation, depreciation and amortisation (EBITDA) for so-called stadium electronic table games are higher than for traditional mass-market live dealer games.
“We believe that most traditional live mass-market table games have an associated EBITDA margin of about 40 % on GGR [gross gaming revenue], while we think stadium-style ETGs have a slightly higher EBITDA margin (approximately 45 %),” says Union Gaming.
“With this in mind, we believe that EBITDA per day on traditional live mass market table games was us$ 3,353 in 2012, but was 58 % higher for stadium-style ETGs at us$ 5,194,” states the research house.
Stadium electronic games are those with tens of player positions served by one or a handful of live dealers, but where betting and bet settlement is done electronically. That allows both for a higher volume of bet money staked per hand – even at minimum bet levels lower than traditional tables – and more hands per hour.
“With an increased focus on table game yields, and the likelihood of any new tables under the table cap scheme being exclusively allocated to new properties, we think all Macau operators will continue to look at ETGs as a valid option,” adds Union Gaming’s report.
Local casino operators especially like stadium installations of ETGs. The local regulator the Gaming Coordination and Inspection Bureau allows them to count 50 player stations – or in some cases 60 player stations – as equivalent to one traditional live dealer baccarat table of eight or nine seats for the purposes of the table cap. The cap is for 5,500 live tables up to December 31, 2012, and then 3% annual compound growth for ten years thereafter.
In addition, the bureau is regulating ETG games as table games rather than as slots, for the purposes of player payouts. “Any electronic gaming machine [that] plays a game that is recognisable to be a simulation of a live casino game … must have an identical RTP [return to player rate],” says the latest version of the Macau EGM [Electronic Gaming Machine] Technical Standards updated in September.
The bureau is also counting ETG revenue as table revenue, the regulator has confirmed to Business Daily via e-mail. Union Gaming says that regionally the market for ETGs is “dominated by six companies, who collectively have a market share in excess of 90 %”.
It lists them as: Aruze Gaming America, a privately held company owned entirely by Kazuo Okada; Alfastreet, a privately held Slovenian gaming equipment manufacturer; Elektroncek, under the Interblock brand name, a 50 %t-owned subsidiary of Australian Securities Exchange-listed slot machine specialist Aristocrat Leisure; Novomatic, under the Austrian Gaming Industries brand, a privately held Austrian gaming manufacturer; Paradise Entertainment under the LT Game brand (which Union Gaming says has 50 % plus of the Macau stadium ETG market) and NASDAQ-listed SHFL entertainment.