Average daily revenues in CNY lower than Jan results – Brokerage

Local gaming revenues during the Chinese New Year period have actually declined when compared to January, analysts from brokerage Sanford C. Bernstein indicated in a note.

According to the brokerage, local average daily gaming revenues in the past eight days have reached MOP188 million (US$23 million) a 23 per cent when compared to the rate of January 2021.

The brokerage attributed the break to the drop in travel volumes in Mainland China due to rising Covid-19 contagion in the country, as the country’s authorities implemented larger scale lockdowns and urging limited travel during the holiday period.

‘The daily average visitor arrivals during the first four days reached 11,943, which is -75.5% y/y, weak as expected due to the advisory travel restrictions posted by Mainland China. We expect visitation to increase only slowly over the next months, assuming travel restrictions due to COVID are not increased,’ the brokerage added.

Bernstein estimates local gross gaming revenue for February 1 to 15 to be approximately MOP3 billion with a month to date average daily rate of MOP200 million, a 78 per cent drop when compared to the same period in 2019, when CNY took place at about the same time.

While month to date VIP daily average volumes are estimated to be down 5-8 per cent month-to-month with a higher than normal win rate, mass-market play volume is estimated to be down 12-13 per cent month-to-month.

‘We estimate Feb GGR to be down in the low 70s per cent compared to Feb 2019 – but much will depend on what happens in the 2nd half of CNY and the rest of the month, which typically sees stronger results than prior to CNY and first few days of the holiday,’ the brokerage added in a note.

The brokerage also believes Macau will continue to experience headwinds during the first half of 2021, but with a strong improvement expected to begin in the second half as COVID-related travel constraints begin to fall away.