Macau gambling revenue breaks 2-yr downward trend with 1 pct August rise

HONG KONG: Macau, the world’s biggest casino hub, posted a 1.1 per cent rise in gambling revenue in August, the first positive monthly year- over-year growth in more than two years, after the opening of Wynn Macau’s US$ 4 billion resort in the southern Chinese territory.

August marks the first upward tick for the former Portuguese colony since May 2014, after monthly revenues plummeted to five-year lows due to slowing economic growth in the world’s second largest economy.

A major anti- graft campaign also kept the very rich from openly flaunting their wealth.

Macau, the only place in China where casino gambling is legal, is set for another multibillion casino resort this month with US billionaire Sheldon Adelson’s Sands China US$ 3 billion Parisian resort.

Improving visitation over the summer helped bolster the mass market segment, which has become a key focus after a dearth of VIP gamblers on Macau’s plentiful baccarat tables.

Gambling revenue was 18.8 billion patacas ( US$ 2.4 billion), government data showed on Thursday, at the top end of analysts’ expectations that varied from a drop of 3 per cent to a 1 per cent growth.

A swift rebound is unlikely, say analysts, who caution the new properties, which include a scale version of the Eiffel tower and an aerial gondola ride, will be impacted by slow market growth and infrastructure bottle necks.

“We believe it is much more difficult to ramp up a new property in a low growth environment, based on Studio City’s and Galaxy Macau Phase 2’s performances,” said Praveen Choudhary, analyst at Morgan Stanley in Hong Kong, citing the examples of last year’s openings from Melco Crown and Galaxy Entertainment, both of which failed to boost the overall market. — Reuters