Gross gaming revenue in Macau increased for a fourth consecutive month in November, figures posted by the city’s Gaming Inspection and Coordination Bureau showed. Casinos in the Chinese special administrative region generated a total of MOP18.8 billion ($2.4 billion) last month, up 14.4% year-on-year.
November’s results represented the strongest year-over-year growth since February 2014. Gaming revenue in Macau started recovering in August 2016 after more than two years of substantial decreases. The city’s gambling industry and overall economy were severely hit by Chinese President Xi Jinping’s campaign against corruption and display of excessive wealth by top country officials.
As a result from the initiative, VIP casino players, revenue from whom had accounted for more than 70% of all proceeds generated at local casinos, withdrew from Macau to keep a low profile. Revenue from high rollers currently represents around 50% of the total.
With VIP customers steering away from China’s only territory where casino gambling is legal, Macau officials have called for the city’s redevelopment into a more mass market-friendly destination. Two integrated resorts – Wynn Palace and The Parisian Macao – opened doors this summer, offering family-oriented entertainment options and attractions, apart from lavish casino floors. It is believed that the refocus efforts have boosted significantly Macau’s casino revenue over the past several months, bringing mass market players to the administrative region.
According to Sophie Lin, credit analyst at market intelligence firm S&P Global Ratings, gross gaming revenue in Macau will drop 3-6% this year and will remain flat or rise up to 10% in 2017. In comparison, full-year casino revenue plunged around 34% in 2015.
Ms. Lin pointed out that new gambling venues openings, ramping up of existing casinos, improved infrastructure to and from Macau, and stabilized casino regulations will encourage a rebound in the city’s gambling industry.
Hotel and casino operator MGM Resorts International is set to open its second Macau property – MGM Cotai – in the second quarter of 2017. Similarly to Wynn Palace and The Venetian Macao, MGM Resorts’ complex will be more oriented towards mass market players and will feature a multitude of non-gambling options.
Ms. Lin noted that there may be cannibalization between new and existing gambling venues but according to her, the worst is behind Macau’s casino industry.
Gross gaming revenue for the eleven months ended November 30, 2016 amounted to MOP203.4 billion, down 4.3% from the same period of 2015.
