Gross gaming revenue for the month of August is up 4.9 per cent year-on-year month-to-date according to ratings agency Telsey Advisory Group. This is based on an assumed electronic game estimate placing monthly gross gaming revenue at HK$18.96 billion (MOP19.53 billion/US$2.45 billion). The agency notes that there ‘is an expectation that numbers for the remainder of the month could rise further’ due to the opening of the Wynn Palace property on the Cotai strip. ‘With signs continuing to suggest that the Macau market is improving, we believe the context for the opening of new properties in the coming weeks is therefore more positive than expected,’ notes the industry update filed by the company. Flipside Analysts at Bernstein hold a very different viewpoint, indicating their estimates on gross gaming revenue month-to-date have only reached MOP12.25 billion, implying an average daily rate (ADR) of about MOP571 million, ‘2 per cent below the similar period last year and below last week and prior month,’ note their analysts led by Vitaly Umansky. ‘Assuming an ADR of MOP580-620 [million] for the remainder of this month (we expect some pick up in the 10 days for the month following Wynn Palace opening), August gross gaming revenue would be MOP18.1-18.5 billion, representing a year-on-year decline of 3 per cent to 1 per cent (and a month-on-month increase of 14 per cent to 16 per cent,’ comment the analysts. The report notes that this ‘figure would be disappointing’ given that they were expecting a flat year-on-year increase in gross gaming revenue. New and fresh ‘We remain keenly focused on the upcoming Macau openings, with Wynn’s Palace opening today and LVS’ Parisian in two weeks,’ note analysts at Telsey, ‘we expect Wynn to be a taker of share upon its opening (irrespective of table game allocation) while other operators’ existing properties could experience market share pressure in the near term’. Bernstein analysts also note that with regard to the ‘Thriller Live’ show, set to run at The Parisian from September 30th to November 13th, ‘if the show has a successful run it may signal that the market may be ready for more ‘Las Vegas style’ show entertainment,’ while a visa-freeze on visitors to the Mainland through Macau or Hong Kong should not ‘have any ramifications on the Macau market’. With regard to the overall gaming environment analysts at Bernstein note that ‘China’s GDP growth will continue in the mid-single digits, the economy will continue to shift towards greater consumer spend and the numbers of individuals achieving income levels sufficient to visit Macau will continue to grow,’ while threats to MSAR revenue would include a deterioration in China’s economic situation or a number of factors including a change in consumer attitudes towards casino gaming.
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