Macau’s casino industry suffered its largest gaming revenue decline in almost three years during April, falling 8.3 percent from a year ago.
Macau’s Gaming Inspection and Coordination Bureau said the market produced $2.92 billion in gaming revenue in April, its weakest month this year and the third decline in the last four months. The percentage decrease was the sharpest since June 2016.
Lack of high-end gambling was thought to be the primary reason for the dip.
“Clearly VIP continues to decelerate even as mass catches a tailwind,” said Union Gaming Group analyst Grant Govertsen, who is based in Macau.
Govertsen and other analysts were expecting a weak month for the market, based on calendar concerns – the month had one fewer Sunday and the timing of a Chinese holiday – and the challenging comparison to a year ago.
April 2018 revenues grew almost 28 percent.
“Comparisons get significantly easier,” said Jefferies gaming analyst David Katz. “Looking forward, May should produce more positive trends given the dynamics of the easier comparisons, improving China macro-economy, holiday shift and bullish management commentary.”
Las Vegas Sands Corp., Wynn Resorts Ltd., and MGM Resorts International all have significant operations in Macau, a former Portuguese colony that is nearing its 20th anniversary as a special administrative region of Mainland China.
For the first four months of the year, Macau gaming revenues are down 2.4 percent.
Stifel gaming analyst Steven Wieczynski said he expects the Macau market to grow revenues between 1 percent and 4 percent for the rest of 2019.
“By and large, we expect the VIP market to deliver a modestly negative year-over-year comparison, with the mass market pacing growth for the market as a whole,” Wieczynski said.
He cautioned, however, that construction disruption from two projects – Las Vegas Sands’ $2 billion transformation of Sands Cotai Central into the Londoner and Wynn Resorts’ plans to add a non-gaming hotel to Wynn Palace – could impact business volumes.
“Whereas 2018 benefited from the opening of MGM Cotai in February,” Wieczynski said.
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
