Market analysts kept predicting that January would be the eighth consecutive month when a rapid decline in revenues will be reported by casino venues on the territory of Macau.
It seems like their prognosis came true as the latest report issued by Macau gambling officials confirms their pessimistic forecast.
According to the statistics, the revenue declined by 17.4% to reach MOP32,7 billion or $3 billion. The local Gaming Inspection and Coordination Bureau representatives said that this has been the longest losing streak since a record about the revenues is kept.
People familiar with the matter are convinced that the anti-corruption campaign, started by the Chinese President Xi Jinping, is among the main reasons for the decline and the lack of high-roller players in particular.
Actually, the revenues would have increased if the President had made the rules less strict. However, Chinese authorities announced that the campaign will be intensified, which left Macau-based casinos with no chance of turning a profit before the second half of the year.
The opening of new venues towards the middle of the year is believed to compensate for the losses and attract new players but the revenues that are to be generated will probably not be sufficient for making up for the previous months.
The economy diversification, recommended by President Jinping, is believed to attract tourists and mass market players to Macau-based casinos, though.
Analysts are not too optimistic about the turnover that will be generated during the Lunar New Year celebrations as well.
An analyst from Union Gaming shared that compared to previous years, the turnover during the upcoming holidays will be much weaker.
As a matter of fact, the analyst said that the decline in February might reach 40%, which is even more disappointing than what has been reported so far.
Nevertheless, compared to December 2014, January was a relatively better month as an increase of 2% was posted.
As for the casino shares, they remained unstable. As much as 1.2% increase was reported by Wynn Macau Ltd., while SJM Holdings Ltd. announced a loss equal to 1.8%.
The shares of Sands China Ltd. and MGM China Holdings Ltd. declined by 0.5%.
Melco Crown and Galaxy Entertainment reported the same numbers as the previous month.
Although the slight increase can be regarded as a positive sign, the truth is that Macau revenues are not going to increase anytime soon as the smoking ban that is to come into force will make the situation even worse.
