Times a-changing


Gaming revenues are expected to continue their southbound journey in 2015, analysts say. However, they believe new properties slated to open this year in Cotai bode well for the industry. The decline in gross gaming revenue can also mark a new era for non-gaming attractions here, Macau Business is informed.
Tim Craighead, director of Asian research and senior casinos and gaming analyst at Bloomberg Industries, expects the city’s gross gaming revenue to range between -5 per cent and flat. “The first half of 2015 may continue to decline at more that 10 per cent due to continued challenges with anti-extravagance, the smoking ban, Chinese economic growth, declining housing prices, etc. The second half may see notable acceleration due to a progressively easier year-over-year comparisons, new resort openings and improving economic growth following the current stimulus measures”, he says.
By contrast, Union Gaming Research Macau calls for a “modest return to growth” in 2015. “There are many industry analysts who believe that 2015 will be another year of decline in GGR. We believe it will be up slightly”, analyst Grant Govertsen says. Even so, Mr. Govertsen says this scenario in the local gaming industry is of concern to investors, hence the significant declines in share prices since the beginning of the year. However, it is not a sign of stability, he says.
Macau Polytechnic Institute Gaming Teaching and Research Centre associate professor Carlos Siu Lam says as the VIP sector contributed about two-thirds to gross gaming revenue, it would stay at 2011 to 2012 levels. Casino takings in 2011 were MOP304.1 billion and MOP 267.9 billion in 2012. “This is going to be affected by such factors as the sustainability, forcefulness and measures taken in the process of the anti-corruption campaign. On the other hand, the opening of new properties in 2015 can do some good for gross gaming revenue”, he says.
Three projects are slated to open in Cotai this year. Melco Crown Entertainment Ltd. will open Macao Studio City, Galaxy Entertainment Group will double the space at Galaxy Macau and Sands China Ltd. plans to open a Paris-themed casino resort -The Parisian – in late 2015. “They would give some new elements to Macau’s gaming and tourism industry and this can help maintain Macau’s attraction in the face of competition from neighbouring regions”, Mr. Lam says.
The full story can be read in this month’s issue of Macau Business magazine, available at newsstands and online at www.magzter.com