March estimates go down for Macau casino industry

According to Bernstein, March GGR projections for the Macau casino industry have been lowered due to recently lowered mass and VIP volume.

Macau.- Forecasts for the Macau casino industry are not very encouraging and have turned even worse. Bernstein analysts have lowered their GGR growth estimates for March due to lowered mass and VIP volume over the last week.

The brokerage showed Macau GGR MTD was €16.9 billion with MTD ADR of €700 million. The figure is 12% lower than from February’s and was down 5% from 2018’s same period, caused by several large-scale junket events that elevated VIP GGR in March 2018.

Bernstein explained it lowered its estimated GGR growth for the Macau casino industry in March from -6% to -5% year-on-year. The negative change includes lowered mass volume at mid-single digits and lower VIP volume at high teens.

“One area of potential high-end GGR stabilization and renewed strength may come from a recovering credit cycle in China which may support VIP recovery in 19H2,” added the brokerage.

Nomura’s forecast

As many brokerages have already forecasted before, the gaming industry is struggling so far in Macau. According to Instinet, a division of the Japanese company Nomura, Macau casino gross gaming revenue (GGR) may be flat or worse by the end of March, with a -5% projection in the worst case scenario.

“Factoring in the somewhat lower-than-expected weekly GGR numbers month-to-date, we now expect the sequential lift in March (from February) to be slightly lower than its historical average of up low-single-digit sequentially,” Nomura’s analysts Harry Curtis, Daniel Adam and Brian Dobson wrote in a Monday note.