Macau GGR Growth Looks To Accelerate In November: Bernstein

The monthly year-on-year growth rate of casino gross gaming revenue (GGR) in Macau is likely to continue accelerating in November, says Sanford C. Bernstein Ltd in Hong Kong. It bases the projection on unofficial industry data.

Macau's November GGR could expand to between 13.9% and 15% year-on-year, according to estimates released Monday by the brokerage.

This marks the fourth consecutive month of growth acceleration since August, when the GGR rose 1.1% year-on-year. It was the first time in 27 months in August that such sales did not decline year-on-year.

Macau's GGR growth rate for the same period last year was 7.4% in September and 8.8% in October.

It was in February 2014 that Macau recorded GGR growth of more than 15% year-on-year. At that time, casino gross income jumped 40.3%.

"According to channel checks and estimates, Macau's GGR is about 17 billion [US$2.13 billion]," Sanford Bernstein said.

"Assuming a daily average of 580 million to 640 million MOPs for the rest of the month, November's GGR will be in the range of 18.7 billion MOPs and 18.9 billion MOPs," analyst Vitaly Umansky, Jen Gong and Yang Si-yi said in a note.

Sanford Bernstein's memo also provided some color to the management performance of individual Macau casino operators so far in November. "Our channel checks suggest that Wynn [Macao Inc] gained share this month, while Melco Crown Entertainment Ltd, MGM [China Holdings Ltd] and Galaxy [Entertainment Group Ltd] all saw some declines in share," it said

Mr. Umanski and his colleagues added. "But we continue to argue that there is a demon in the details between VIP and the bulk and overall market share. So the proportion of the overall GGR figure needs to be taken with some skepticism."

Increase in momentum

Brokerage Telsey Advisory Group LLC's latest GGR earnings estimate for Macau was not as upbeat as Sanford Bernstein.

"Our industry sources estimate that Macau's GGR will track +8% year-on-year for the month, based on gameplay in the first 27 days of November," analysts David Katz and Brian Davis said.

They said: "After strong October, including solid results during the Golden Week (the seven-day holiday period in mainland China surrounding Chinese National Day), and a month of high single-digit growth, our sources expected to ease in November. We are encouraged by the acceleration of the results of the past week, which is increasingly positive for operators in the region following a strong month," it added 릴게임

"The momentum continues to recover in Macau," Christopher Jones of Buckingham Research Group said in a note on Monday

"Increased room capacity, increased average spending per customer, and somewhat better demand are all driving the region's performance," he added

Two new casino resorts have recently opened in Macau's Kotai area: Win Macau's 1,700-room Win Palace and Sands China's 3,000-room Paris Macau, which opened on August 22 and September 13, respectively.

According to data from the Macau Government Tourism Bureau, Macau had 36,200 hotel rooms in all categories, including guest houses, as of Sept. 30, up 20.7% from a year earlier.