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China – Macau revenues up to 30 per cent of 2019’s figures as easing of travel restrictions sees immediate influx

By - 11 January 2023

JP Morgan has detailed how Macau’s casino sector produced their best weekly revenue since February 2022 with GGR of US$261m for the first eight days of January, equating to to 30 per cent of 2019 levels.

The increase, due to the lifting of border restrictions between Macau, China and Hong Kong was more than double the US$14.9m average weekly revenue in the fourth quarter of 2022 and indeed the whole year. Visitation surpassed100,000 in the first three days since travel restrictions were lifted. Sunday’s total of 39,643 was the highest total for a single day since February 2022.

JP Morgan analyst DS Kim said: “The print implies a mass GGR recovery of 45 per cent to 50 per cent of pre-COVID-19, if we assume that VIP accounted for 10 per cent to 15 per cent of this MOP$260m print. The current trend is already above our modelled 35 per cent to 40 per cent mass recovery for LNY, clearly suggesting upside risk to near-term numbers.

“It seems that Macau hotels will likely be near-sold-out for the holiday (in fact, good/affordable rooms are already not easy to find even for the coming days and weekend, a typical lull period before the long holiday), and we wouldn’t be surprised to see mass demand hitting 50 per cent+ of 2019. If this happens, it should comfortably beat both sell-side and buy-side expectations, in our view.”

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