Operator News
China – Analysts lay out expectations of World Cup’s effect on Macau
By Phil - 4 June 2018
Macau’s 41 casinos delivered less than expected in May with revenue slowing to 12.1 per cent growth in May, compared to 27.6 per cent in April and 22.2 per cent in March.
Analysts are concerned that the 2018 FIFA World Cup in Russia, which kicks-off on June 14, will keep players away from baccarat tables as they look instead to bet on the World Cup.
Steven Wieczynski of Stifel Nicolaus Capital Markets said: “The tournament has historically accelerated the rate of month-to-month decline in Macau’s market-wide gross gaming revenue. We would not be surprised to see investors use the May comparison as a reason to take a breath and lock in profits ahead of what could be a tricky June period impacted by the forthcoming World Cup.”
May’s GGR hit $3.16bn, well short of analyst predictions of a 20 per cent increase but the month was the territory’s 22nd month of consecutive growth.
Deutsche Bank said it expected ‘some VIP softness’ during the tournament with some Macau junkets taking clients to games in Russia although it added any effect would be ‘nothing more than a transitory impact.’
Deutsche Bank gaming analyst Carlo Santarelli said: “We see limited historical evidence to support a material impact from the World Cup or Euro Cup events.”
Jefferies gaming analyst David Katz said: “We maintain a positive view on the underlying fundamental businesses and adjust our expectations for tough comparisons throughout the summer months.”
At the end of the first quarter of 2018, there were 41 casinos, of which 22 were run by Sociedade de Jogos de Macau, six by Galaxy Casino, five by Venetian Macau, four by Melco Crown, two by Wynn Resorts and two by MGM Grand Paradise, with 6,586 gaming tables and 17,205 slot machines.
