Growth in casino gross gaming revenue has eased slightly, with the likelihood of further easing The runaway growth in gaming revenue taken by the city’s casinos slowed last month. It is a trend which is unsurprising, since the sector grew at a gallop towards the end of last year. The take by Macau’s casinos stood at a healthy MOP23.06 billion (US$2.88 billion) last month, according to data from the Gaming Inspection and Coordination Bureau. The increase was 32.9 percent year-on-year, the slowest rate of growth registered so far this year. Even so, last month’s result exceeded MOP22.2 billion – the average monthly result from the first 11 months of this year. Total casino gross gaming revenue to the end of November was up 44.1 percent year-on-year to MOP244.26 billion. Looking ahead to next year, growth is likely to cool further. The consensus among the city’s casino concessionaires is for decline to between 15 percent and 20 percent in gross gaming revenue growth, says JP Morgan, which sent a team of analysts to Macau last month. The estimates are in-line with the investment bank’s forecast. JP Morgan says the majority of management teams in Macau it contacted forecast growth in the first half would be “relatively muted given the staunch comparisons from 2011 but should accelerate throughout the year” given the opening of Sands Cotai Central in late March. Liquidity bump There may be some surprises in store early this month after the People’s Bank of China unexpectedly cut the reserve requirement ratio for commercial banks by 50-basis points. Union Gaming Research Macau says the loosening of monetary policy by the central bank will benefit casinos. The first cut in nearly three years will allow mainland banks to lend more, increasing liquidity in the system and hopefully prompting economic growth. Estimates say the move could free up to about US$62 billion in capital. Eventually, part of that is likely to end up on Macau’s baccarat tables. Union Gaming Research says even bigger gains will be made in operators’ stock prices. The research firm says that when the reserve requirement ratios began tightening three years ago, there were concerns Macau gaming revenues would be hit. That was not the case. “With this in mind, we suspect that this reversal in policy could have a greater impact on sentiment than on market forces,” Union Gaming wrote in an investors’ note. “We suspect the positive sentiment could have a disproportionate impact for Macau operators with greater exposure to VIP customers.” Some casino operators shuffled places on the monthly gross gaming revenue league table last month. SJM Holdings Ltd. led the market with a 27-percent market share, followed by Galaxy Entertainment Group Ltd. with a 20-percent share. Sands China Ltd. climbed one position, to a 16-percent market share, passing Melco Crown Entertainment Ltd. and Wynn Macau Ltd., both with about a 13-percent share, but with Wynn slightly ahead. MGM China Holdings Ltd. rounded the ranking with 11 percent of the market. Bally announces new head for Asia-Pacific Cath Burns leaves the company after six years Bally Technologies, Inc. announced that vice president Srini Raghavan has been assigned to oversee the company’s games and systems activities in the Asia-Pacific region. He will combine this new responsibi- lity together with his continued role as managing director of Bally’s development centres in India and managing the systems operations in South Africa. Meanwhile, Kurt Gissane has been promoted to managing director of Asia-Pacific, headquartered in Macau, to manage the day-to-day business operations and customer relationships. These changes follow the departure of Cath Burns, Bally’s managing director of Asia-Pacific, who recently left the company after six years of service. TCS John Huxley appointed Ms Burns as global chief executive officer, effective of March 2012. At Bally, Ms Burns established the company’s Asia Pacific head office in Macau for both its gaming and systems business operations. She managed large-scale systems installation projects for several of the city’s new casinos.
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