Macau casino EBITDA to decline in Q2, analysts say

Morgan Stanley cited an expected decrease in mass revenue and rising costs.

Macau.- Analysts at Morgan Stanley expect the six gaming operators in Macau to report lower earnings before interest, taxes, depreciation, and amortisation (EBITDA) figures for the second quarter of 2024 compared to the market consensus due to an expected decrease in mass revenue and rising costs.

Analysts Praveen Choudhary, Gareth Leung, and Stephen Grambling noted that the city’s gross gaming revenue (GGR) for the second quarter of the year is likely to be down between 1 to 2 per cent when compared to the previous quarter, while mass GGR could decline by 2 to 3 per cent.

They forecast that June’s GGR will reach MOP18bn (US$2.2bn), marking an 11 per cent month-on-month decrease. Morgan Stanley expects Sands China’s EBITDA to be below consensus estimates due to the company losing mass GGR market share because of construction disruptions. SJM is predicted to achieve the market consensus of an 8 per cent increase in EBITDA linked to the ramp-up of Grand Lisboa Palace.

Macau’s GGR for May was MOP20.19bn (US$2.51bn). That’s an increase of 8.9 per cent month-on-month and 29.7 per cent when compared to May 2023. Cumulatively, Macau’s GGR for the first three months of 2024 was MOP$57.3bn (US$7.11bn), up 65.5 per cent year-on-year and implying a full-year run rate of around MOP$229.2bn (US$28.4bn)