Macau casinos surpass US$1bn EBITDA in Q1, analysts say

It’s the first time EBITDA has hit US$1bn since the Covid-19 pandemic began.

Macau.- Casinos in Macau are estimated to have surpassed US$1bn in collective earnings before interest, taxation, depreciation, and amortization (EBITDA) in the first quarter of 2023, according to analysts. It’s the highest figure since the pandemic began in early 2020. 

Citigroup Global Markets Inc analysts George Choi and Ryan Cheung said that Macau generated industry EBITDA of US$1.038bn in the first quarter of the year. Meanwhile, DS Kim and Mufan Shi of JP Morgan Securities (Asia Pacific) also estimated that the six operators will have generated US$1bn-plus in EBITDA.

Macau’s casino gross gaming revenue was over US$4.28bn for the three months to March 31, up by almost 95 per cent compared to the same period last year. 

JP Morgan says it expects MGM China Holdings to deliver the best performance in the first quarter, with an estimated mass/slot gross gaming revenue of almost 110 per cent of pre-pandemic levels. Citigroup also picked MGM China as the best performer in terms of recovery for the first three months and suggested that SJM Holdings would be the slowest to recover. 

Citigroup said that SJM would likely be the only operator remaining in negative EBITDA territory, albeit with a narrowed EBITDA loss. It forecast SJM Holdings’ EBITDA loss at US$35m for the first quarter, compared to US$123m in the fourth quarter of 2022.

Prior to the relaxation of Covid-19 countermeasures in Macau, mainland China, and Hong Kong in early January, the Macau industry experienced several quarters of negative EBITDA. However, operators managed to cut costs during this period and have kept costs below pre-pandemic levels.