Macau casinos likely to post EBITDA losses for Q2, analysts say

Macau GGR fell 62.1 per cent year-on-year in June.
Macau GGR fell 62.1 per cent year-on-year in June.

Analysts at JP Morgan Securities predict that Macau casino operators will report negative EBITDA for the quarter due to poor GGR performance in June.

Macau.- The new outbreak of Covid-19 cases in Macau has deeply affected the gaming industry, causing June to see one of the worst GGR performances since September 2020. As a result, analysts at JP Morgan Securities have warned that Macau casino operators are likely to post negative earnings before interest, taxation, depreciation and amortisation (EBITDA) for the second quarter.

Macau’s gross gaming revenue for Q2 was down 67 per cent year-on-year and 52 per cent quarter-on-quarter at MOP8.5bn (US$1.050m). The figure was just 12 per cent of pre-pandemic levels. 

Analysts said that at this level, none of the operators would be able to generate positive EBITDA, not even Galaxy Entertainment Group.

Brokerage Sanford C. Bernstein Ltd added that Macau’s average daily volume of travel in and out of the city between June 17 (when the first new Covid-19 cases were reported) and June 29 was down 77 per cent week-on-week to only 9,400.

Deutsche Bank Securities Inc has updated its third-quarter predictions for Macau casino revenue and forecasts that third-quarter GGR will be down 31 per cent year-on-year from US$2.34bn to US$1.62bn.

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Covid-19 Macau casinos