2020 Q1 gaming revenues could see 50pct y-on-y cut due to coronavirus casino shutdown – Brokerage

Analysts at Sanford C. Bernstein stated that the announced shutdown of local casino operations for a 15-day period could lead to ‘awful’ gross gaming revenue results in the first quarter of this year.

‘Assuming only a two-week shutdown followed by some soft business resuming in late February and March, Q1 could show GGR y/y decline of 50 per cent. If casinos were to remain closed for the rest of Q1, GGR would show a y/y decline of over 70 per cent,’ the brokerage said in a note today.

‘The continued contagion, especially the increase in Macau cases (to 10) has pushed the Macau government to act to close areas where people would congregate. This follows China already stopping IVS visa issuances and terminating all group travel and Macau putting limitations on entry. Visitation was down to a trickle out of China’

Macau gross gaming revenues have dropped by 11.3 per cent year-on-year in January 2020 to MOP22.12 billion (US$2.7 billion) with the number of Macau visitors during the Chinese New Year holiday period between January 24 and 30 – known as ‘Golden Week’ – falling 78.3 per cent year-on-year to 261,069.

Macau had previously only shut down casino operations during a 33 hours period in 2018 due to Super Typhoon Mangkhu.