Macau Casino Win Down Nine Percent, But More Favorable Comparisons Coming

By | March 1, 2021

Macau casinos reported gross gaming revenue (GGR) of MOP7.31 billion (US$914.8 million) in February, an 8.9 percent reduction from January.

Macau casino gaming revenue
The Cotai Strip in Macau, seen here prior to the pandemic, is welcoming back visitors. But casino win remains much lower than pre-COVID-19 levels. (Image: The New York Times)

February is a difficult month-over-month comparable since it only has 28 days, while January has 31. But February 2021 benefited from having the Chinese New Year, a weeklong holiday that was held in late January in 2020.

With gaming win down nearly nine percent despite the inclusion of the holiday, analysts were underwhelmed with the market’s performance.

Overall, we view this GGR as having little implication on forward estimates, given well-followed mid-month GGR and severe volatility around Chinese New Year holidays,” explained JP Morgan analysts DS Kim and Derek Choi.

“[February] was a bit underwhelming, but doesn’t really move the needle,” they concluded.

The volatility referenced stems from ongoing entry restrictions into the Chinese Special Administrative Region. During February, Macau continued to allow entry only for people arriving from mainland China, Hong Kong, or Taiwan. Those who were granted admission were then subject to quarantine requirements.

First Positive Month

February 2021 was Macau’s first year-over-year monthly comparison showing a GGR percentage increase since September of 2019. The month ended a run of 16 consecutive monthly year-over-year declines.

More are likely coming.

February 2020 is when China and Macau fully recognized the dangers of COVID-19. Macau forced its casinos to shutter operations for 15 days, pushing GGR down 88 percent to just $387 million. At the time, it was the worst monthly performance in the history of the enclave’s gaming industry.

Conditions surrounding the coronavirus have since improved, as the vaccine is being distributed and administered around the world. As a result, Macau’s February 2021 report improved.

Gaming win last month was 135.6 percent higher than February 2020. Assuming there are no setbacks in battling the coronavirus, it’s likely that the months ahead will also show year-over-year GGR increases.

February’s $914.8 million casino win would be higher than any other 2020 month, the lone exception being December 2020, when casinos won roughly $978 million.

Border Opening

Macau Government Tourism Office Director Maria Helena de Senna Fernandes said last week that the region is working closely with mainland authorities to resume e-visas as soon as possible. Obtaining Individual Visit Scheme (IVS) permits to travel from China into Macau continues to be done by paper only, a process that can take weeks.

China suspended e-visa IVS processing last year to slow cross-border travel.

During his firm’s 2020 full-year investor call last week, Melco Resorts founder and CEO Lawrence Ho expressed optimism for recovery. He cited Macau’s recent decision to lift quarantine requirements effective immediately for mainland Chinese people arriving at the enclave.

“We remain optimistic on the recovery in Macau and continue to expect increased visitation in the near-term,” the billionaire explained. “Earlier this week … all quarantine restrictions were lifted for those traveling from mainland China to Macau. More notably, there are no quarantine restrictions for those mainland Chinese citizens who are returning from Macau.”

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