Posted on: August 21, 2023, 01:32h.
Last updated on: August 21, 2023, 03:49h.
Prior to the coronavirus pandemic, Macau was the world's top casino center in revenue terms, flourishing due to its proximity to China and those citizens' love of wagering. That status was ceded due to the global health crisis.
In a move that proved comparably false and eerily reminiscent of the “two weeks to flatten the curve,” conjecture spewed so frequently in the US during the early days of COVID-19, Macau gaming venues shuttered for 15 days in 2020 with hopes that a return to normalcy would soon follow. Anything but normal was the result, as it wasn't until January 2023 that the Chinese Communist Party (CCP) lifted the country's coronavirus protocols, which included a host of restrictions that made travel to Macau difficult.
Along the way, the special administrative region (SAR) lost the title of “world's top casino center” to Las Vegas. Led by Sin City, Nevada's gross gaming revenue (GGR) topped Macau's for much of the pandemic. However, the Chinese gaming enclave is getting its groove back.
In the first half of this year, Macau's six concessionaires generated a combined GGR of $10 billion, well ahead of the $7.5 billion notched by Nevada casino operators, according to the Wall Street Journal.
Macau Could Bolster Lead Over Las Vegas
Macau's 2023 resurgence could prove to be more floor than a ceiling. Analysts are forecasting the SAR's GGR for 2023 won't reach 100% of 2019 levels, implying room for growth.
A return to pre-pandemic revenue levels is widely expected to arrive next year, indicating Macau's GGR may lead over Las Vegas will increase. Notably, Macau's GGR out-performance of Sin City is being accrued without significant contributions from VIPs.
The SAR's junket industry, which delivered high rollers to casinos, is a shell of itself and barely reminiscent of the go-go days seen in the prior decade. This time around, mass and premium-mass players are doing the heavy lifting.
“While high rollers are fewer in number than during Macau's heyday a decade ago, even low-end gamblers typically bet more than $1,500 at the tables per hour, and higher-end, mass-market players lose on average more than $2,500 a day,” the Journal reported, citing industry analysts.
Citi's most recent Macau table survey suggests premium mass players' average table game wagers increased by 5% this month.
Whales Returning to Macau in Incremental Fashion
Las Vegas isn't short of high rollers, but on that front, the numbers game favors China, and that's good news for Macau operators. The better news is that there are some signs that whales are starting to return to the SAR.
The Citi survey indicates VIPs, or those bettors whose average wagers are close to $13K per hand, showed a modest uptick in terms of Macau visits this month.
“The data that we gathered before COVID showed similar month-on-month declines in wager per player in 2018 and 2019,” noted the bank. “We believe this seasonal trend is attributable to the fact that the visitation-strong month of August is also a month when the more casual, less keen players show up.”
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