The influx of mainland Chinese tourists boosted casino revenue in Macau to MOP 15.6 billion ($1.93 billion) in May, up 366% from a year ago. The latest earnings were also 6% higher than the MOP 14.7 billion ($1.81 billion) generated in April. Since the start of the year, casino revenue has amounted to about MOP 65 billion ($8.06 billion), nearly three times the MOP 23.8 billion ($2.9 billion) registered in the same period last year.
The monthly take was bolstered by a five-day national holiday that saw hundreds of thousands of visitors flock to the special Chinese administrative region, which is the only place in China where citizens can legally gamble in casinos. Around 500,000 people visited the gaming hub during the Labour Day holiday at the start of the month.
The latest May earnings represent the highest monthly total since 2020, when the COVID-19 pandemic had still to fully grip China. However, revenue since the start of the year is still just about half of the MOP 125.7 billion ($15.5 billion) that Macau’s casino industry earned in the same period in 2019, the last full year before the coronavirus pandemic struck.
“The comparison with last year will be amazing because of the low base. In the medium term, the city and casino operators have to widen their business as encouraged by the central government,” said Louis Tse Ming-Kwong, Managing Director of Hong Kong-based broker Wealthy Securities, as reported by the South China Morning Post.
“It will take time [for a full recovery of the gaming segment] and will require a stronger recovery by the Chinese economy. Besides Chinese tourists, inflows of tourists from other countries should also be increased, so casinos must do more promotion work,” he added.
Authorities are keen to diversify sources of income in Macau, which depends on casinos for more than 80% of its government revenues and has imposed strict new regulations on its six casino operators. The rush of visitors comes as the densely populated territory grapples with an acute labor shortage, a key concern for casino operators.
However, the latest revenue figures bolster a market consensus that casinos’ earnings are likely to beat expectations this year. Casino operators have reported improved revenues so far this year.
Sands China reported that its net revenue in the first quarter rose by 132% from a year ago to more than half of its pre-Covid-19 levels. Meanwhile, Galaxy Entertainment Group said revenue increased 72% to $900 million in the same three-month period. Galaxy Entertainment has four properties in Macau – Starworld Hotel, Galaxy Macau, Broadway Macau, and City Club.
Additionally, MGM China reported a 131% year-on-year gain in net revenue to $617.9 million in the first quarter. Melco International Development recorded a 51% year-on-year increase in total operating revenue to $716.5 million. Wynn Macau’s total operating revenue doubled to $600 million in the first quarter, while SJM Holdings saw its net revenue increase by 57.6% to $510.7 million.
In a sign that the casino hub is back to business, Sands last week officially opened The Londoner Macao resort, which includes a 6,000-seat arena and attractions like a replica of London’s Big Ben clock tower. It was the first big casino opening since the COVID pandemic and was attended by former England football captain David Beckham, who drew scores of fans to the property.
The casino segment’s apparent recovery is good news for the city’s six operators, which will invest a combined amount of more than MOP 100 billion ($12.4 billion) in Macau over the next decade. Most of the amount pledged will be used for non-casino businesses, in line with the aforementioned effort to diversify Macau’s economy away from gaming.
Original article: https://www.yogonet.com/international/news/2023/06/01/67369-macau-casino-revenue-reaches-193b-in-may-driven-by-the-return-of-mainland-chinese-tourists
