Asian Gaming Intelligence undertook a closer examination of October’s Macau table gaming revenue figures, which highlight some interesting trends among the operators.
The headline result in October was MGM Macau’s rise from last place among the six operators in the local market share rankings to the fifth spot, overtaking Galaxy Entertainment Group. A closer examination of the table gaming results below (not including slot revenues, which account for less than 5% of total gaming revenue), show that Galaxy’s relegation to market share laggard is likely to be short lived, as it was the result of a particularly unlucky month, with a VIP baccarat win rate of 2.48%, compared to a particularly lucky month at MGM Macau, which experienced a win rate of 3.23%. If both operators had experienced a market average win rate of 2.9% in October, Galaxy would have comfortably maintained its lead over MGM Macau.
Macau table gaming revenue by operator in October 2010 (excluding slots revenue)
| Main Gaming Floor Revenue (HK$ bn) | VIP Baccarat Turnover (HK$ bn) | VIP Baccarat Win Rate (%) | VIP Baccarat Revenue (HK$bn) | Total Revenue (HK$ bn) | Share of Revenue From VIP Baccarat (%) | |
| SJM | 1.62 | 153.94 | 2.72 | 4.19 | 5.81 | 72 |
| Sands China | 1.08 | 53.05 | 4.08 | 2.16 | 3.24 | 67 |
| Melco Crown | 0.38 | 68.93 | 2.96 | 2.04 | 2.42 | 84 |
| Wynn Macau | 0.47 | 72.56 | 2.61 | 1.89 | 2.36 | 80 |
| MGM Macau | 0.36 | 45.98 | 3.23 | 1.48 | 1.84 | 81 |
| Galaxy | 0.17 | 64.12 | 2.48 | 1.59 | 1.77 | 90 |
| Industry Total/Avg | 4.07 | 458.57 | 2.91 | 13.36 | 17.44 | 84 |
The other key takeaway from the above data is how much more the entire market has become dominated by VIP baccarat. While VIP baccarat accounted for 70.7% of all table gaming revenue in 2009, it contributed a whopping 84% in October this year. Galaxy is the most VIP-reliant operator, deriving 90% of its table gaming revenue from VIP baccarat. This is not surprising given the small footprint of its flagship StarWorld property, necessitating a strategy focused on a relatively small numbers of customers (namely, VIPs). It also comes as small surprise that Sands China is the operator least reliant on VIP baccarat—which comprises 67% of Sands China’s total table revenue—given its sprawling main gaming floors at Venetian and Sands Macao and its diversified entertainment offerings.
Sands China stands in stark contrast to the other Macau operator which currently boasts significant mass-market crowd-pulling potential—Melco Crown, operator of the expansive City of Dreams resort, located across the street from Venetian Macao on the Cotai Strip
City of Dreams unveiled its much-hyped HK$2 billion (US$200 million) ‘House of Dancing Water’ show in September, but the results in October, the first full month of the show’s operation, suggest it has yet to provide a significant boost to the property’s mass market table gaming revenue. Venetian Macao continues to provide a far superior mass market draw, generating main floor table gaming revenue of HK$0.68 billion in October, versus City of Dreams’ HK$0.33 billion.
And although Melco Crown recently overtook Wynn Macau to take third spot in the Macau market share race, this has been partly the result of relatively lucky months at Melco Crown versus relatively unlucky months at Wynn Macau, and also, according to our sources, rather aggressive extension of credit by Melco Crown to junket operators. Gaining VIP business through more aggressive credit has proven in the past to be a potentially risky and short-lived strategy in Macau.
