Gaming in Macau registered its first month with a decrease in gross gaming revenue (GGR) on a subsequent basis since all travel restrictions for the Special Administrative Region (SAR) of China have been lifted.

Recovery Slowing Down but Strong

The monthly Games of Fortune statistics report published by the Gaming Inspection and Coordination Bureau (DICJ) revealed that casinos generated GGR of MOP$15.21 billion ($1.89 billion) in June.

The June result is 2.3% down compared to MOP$ 15.57 billion ($1.92 billion) the SAR casino industry registered in May when the market grew by 5.73% on a sequential basis to account for a third consecutive month of growth since February.

In mid-June, JP Morgan Securities (Asia Pacific) issued a note advising investors that, based on seven-day daily run rates, the firm’s previously issued June forecast of between MOP$ 14 billion ($1.74 billion) and MOP$ 14.5 billion ($1.8 billion) “may prove too conservative” and the June tally proved the advisory was spot on.

Among the factors identified for the better daily run rates, JP Morgan analysts outlined the return of live concerts to Macau venues such as the Cotai Expo at The Venetian Macao and Melco Resort’s casino resort Studio City.

“..we would not be surprised if June bucks the weak seasonality to print better than MOP$500 million ($62 million) per day,” analysts Kim and Shi wrote, suggesting that casinos may post strong second-quarter results that would beat the market consensus, pushing up mass GGR and EBITDA to over 80% and 65% of pre-pandemic levels, respectively.

Well Below Pre-Pandemic Levels

The June GGR also represents an increase of 513.9% to MOP$ 2.48 billion ($307.5 million) Macau casinos registered in June in the year prior but is still far below (36.1%) the pre-pandemic 2019 level of MOP$ 23.81 billion ($2.95 billion).

The year-to-date figure stood at MOP$ 80.14 billion ($9.94 billion), posting an increase of 205.1% from MOP$ 26.27 billion ($3.26 billion) accumulated during the first six months of 2022. The YTD result is 46.2% below MOP$ 149.5 billion ($18.54 billion) the industry achieved in Jan-Jun 2019.

Official visitation data showed that Macau saw a daily average of over 70,000 arrivals in June and with an aggregate total of almost 9.44 million for the first five months of the year, the government is expecting a total of more than 20 million tourists to visit the SAR in 2023.

Confident of the continuing recovery throughout the year and beyond, Macau chief executive Ho Iat Seng said that the industry could well achieve a GGR of MOP$ 130 billion ($16 billion) in 2023.

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