Gaming revenues may drop 16.5pct in January

It’s still a huge drop but at least it is the best performance turned in by the gaming industry in the last three months. Gaming revenues in Macau will likely decline 16.5 per cent this month, according to a poll of four investment houses conducted by Business Daily.
With investor checks only going as far as January 11, the estimations for the full month still have a considerable margin of error – and in previous months, final figures have fallen on the lower side of interval expectations. If market predictions are correct and casino revenues drop by 16.5 per cent in January on a year-on-year basis, Macau casinos will have its best month since September. Gaming revenues went down at an average 25 per cent in the last quarter of 2014.
Of all four investment houses, the size of the decrease in revenues this month ranges from 13 per cent from HSBC to 20 per cent from Daiwa. The most pessimistic is Wells Fargo, with a midpoint 18 per cent decline (see table).
Wells Fargo said in a note to clients yesterday that daily revenues coming from revenues during the second week of January was MOP743 million, 22 per cent behind January’s first week (MOP950 million) and 1 per cent down from December’s daily average. December was the worst month for the industry here with revenues plunging 30.4 per cent. The US-based daily revenues need to stay in a MOP715-755 million band for the rest of the month. Sterne Agee says revenues from casinos here totalled MOP8.7 billion in the first 11 days of January, a drop of 13 per cent from a year ago.
Macau gaming operators recovered some ground yesterday in the stock market, with shares improving around 1.5 per cent (except Melco Crown, which lost 1.2 per cent). This, in a week that saw the arrest of more than 100 people in Macau related to a prostitution ring, including Alan Ho, nephew of casino tycoon Stanley, and other executives. In addition, Studio City, one of the ten big mega casinos set to open up to 2017, presented itself, changing even more the gaming landscape of Macau.