Analysts: Mass strengthens in Q2

202

Gross gaming revenue from the MSAR’s mass tables grew 14.8 per cent year-on-year in the second quarter, according to analyst Grant Govertsen of Union Gaming. The report by the group notes that while being in line with its estimates it was 780 basis points higher than the 7 per cent official increase stated by the local Gaming Inspection and
Co-ordination Bureau (DICJ).
The group’s analysis of VIP gross gaming revenue during the quarter pointed to a 30.8 per cent year-on-year increase, as opposed to the 34.8 per cent increase stated by the DICJ, and a 15.8 per cent increase in slots as opposed to DICJ’s 17.2 per cent. The 20 per cent increase in overall gross gaming revenue was in line with DICJ data, the group notes.
The onslaught of Typhoon Hato, followed by Typhoon Pakhar ‘took a large bite out of what would have been a spectacular gross gaming revenue growth rate for the month of August,’ said Govertsen. The group notes that after the 29 per cent year-on-year increase in July ‘it had appeared that August could have approached or even eclipsed that rate’ – the group’s expectations now, however, are for the results to be ‘in the low 20 per cent range’.
Following the devastation of the super typhoon last week, the group perceives that the city as such lost the chance to obtain ‘a spectacular GGR [gross gaming revenue] growth rate for the month of August’.
Furthermore, Union Gaming expects September’s performance ‘to be in the high teens’.
In broad terms, the growth rate for the third quarter would be similar to the rate in the second quarter, in the low 20 per cent range, the analyst points out.
‘We would expect the VIP and mass splits to be fairly similar, too, with mass growth in the mid-teens and VIP approaching 30 per cent,’ writes the analyst.
Without taking into account the new properties of Wynn Palace and The Parisian, the analyst notes that the prospects of same-store gross gaming revenue growth ‘was in excess of 9 per cent during the quarter’.
Growth rates by segment are estimated at 16.8 per cent for VIP, 3.3 per cent for mass, and negative growth of 1.8 per cent for slots.
With yesterday’s interim result announcement of Galaxy Entertainment Group posting stronger mass market growth compared to the other five gaming operators in the city, Union Gaming continue to identify Galaxy as ‘a top pick’ in playing the ongoing recovery of Macau.