Macau daily GGR to rise over Labour Day holiday, analysts say
Credit Suisse forecasts that Macau’s casinos could generate MOP750m (US$92.8m) daily during the holiday period.
Macau.- Analysts at Credit Suisse predict daily gross gaming revenue (GGR) of up to MOP750m (US$92.8m) for the first three days of the upcoming Labour Day holiday period, from April 29 to May 3 inclusive.
The memo from analysts Kenneth Fong and Sardonna Fong suggests makes the forecasts based on channel checks. It also mentions that first-quarter market share gains for MGM China Holdings Ltd were “sustainable” but that some Macau operators believe the industry requires a mass-market GGR recovery of 120 to 130 per cent compared to pre-pandemic year 2019, to recover to 2019 levels of EBITDA.
The bank cited several factors likely to affect EBITDA margin over the next few years, including higher mass-market reinvestment rates in players due to industry competition for customers and lower-than-expected benefits from cost-saving. The latter is partly due to a mismatch in labour supply and demand, with casinos lacking non-gaming labour while having excess gaming workers.
Macau GGR improved by about 10 per cent from MOP370m in January and February to around MOP411m in March. Analysts added that April mass GGR continues to be sequentially stronger than that of March, forecasting a 4 to 5 per cent increase.
Despite the improvement in GGR, they said the underlying EBITDA benefit will be lower than the GGR suggested. While Macau’s casino GGR was up 246.9 per cent year-on-year in March to just under MOP12.74bn, the bank warned that the improvement was mainly driven by VIP and higher luck factors.
The Macau Gaming Inspection and Coordination Bureau (DICJ) has reported that casino GGR in Macau reached MOP8.4bn (US$1.05bn) in the first 15 days of April, indicating a daily run-rate of approximately MOP560m (US$70m), which is lower than Credit Suisse’s prediction.
See also: Analysts expect strong Labour Day break for Macau casinos
