According to the latest financial reports, the revenue of Macau-based casinos continues to fall. November was the sixth consecutive month in a row in which a significant decrease in revenue was announced.
The numbers were even worse than experts’ predictions. One of the main reasons for the decline was the fact that authorities took some actions that made high roller players reconsider visiting Macau casinos and opting for a closer location.
During the previous month, the revenue fell by almost 20%. In other words, the turnover generated in November was equal to $3 billion. That was the official information released by the Gaming Inspection and Coordination Bureau in Macau. According to a number of experts, the revenue was expected to fall by approximately 19.3%, so despite the further decrease, their estimates left no room for shock and surprises.
The situation with the revenue has not been so bad since 2008 when a decrease was reported for seven months in a row.
A prominent market analyst commented that the high roller players are not likely to come back to Macau venues at least before the visit of the Chinese President Xi Jinping, who is supposed to visit Macau in December.
Although the results for November were not too optimistic, October was the worst month up to now. A decrease of 23% was reported, which made analysts remind about the numbers announced in October 2013. They were much better and made them draw the conclusion that the campaign of the President, concerning the corruption affairs, has severely affected the revenues of Wynn Macau and Melco Crown Entertainment.
However, the worst numbers were reported by SJM Holdings Ltd. The company used to be a competitive one five years ago but now, it announced a significant downfall of 41% YOY.
Last week, Macau gaming regulators declared that 2014 is going to be the first year that they will have to report such disappointing results. Apart from the absence of high roller players in Macau casino venues, the policy of the President towards dealing with corruption did more harm than good to casino revenues.
According to Ambrose So, the CEO of SJM, the revenues generated from high roller players are not likely to get improved within the first half of 2015. As a matter of fact, he predicted that the increase during 2015 will be insufficient.
Gaming regulators have been keeping a record of annual revenues for more than a decade and according to the data, 2014 will be the worst year.
Having said that, Macau authorities are trying their best to find an alternative for improvement. They have announced that three casino venues, located at Hengqin Island and Zhuhai are going to have extended working hours and the changes are believed to be favorable to the revenues as they would allow one-day visitors to take part in gambling activities.
