Macau’s gross gaming revenue (GGR) is trending “better than expected” over the first nine days of December, suggesting year-on-year growth could push into the teens, according to analysts.
In a Monday note, Bernstein’s Vitaly Umansky, Eunice Lee and Kelsey Zhu said Macau’s operators had taken average daily revenue of MOP$877 million from 1 to 9 December, up 6% over a similar period last year and 20% over the entire December 2017 average. They added that December 2017 was “relatively weak with low hold and soft volumes, which makes for easier comparison” due to the loss of VIP business overseas and slowdown issues related to a large Guangdong underground bank.
Likewise, J.P. Morgan’s DS Kim and Sean Zhuang described the monthly progress as “very impressive”, being well above November’s MOP$833 million daily average. November GGR beat consensus by growing 8.5% to MOP$25 billion.
The analysts pointed to strong volume in both VIP and mass across the past two weekends with VIP looking particularly solid.
There is therefore a “good chance of another GGR beat for December,” Kim and Zhuang said, with December GGR shaping to reach 11% growth. However, this implies “only MOP$800 to MOP$810 million per day run rate and thus appears rather conservative versus MTD trends.
“We wouldn’t be surprised to see December GGR printing mid-teens growth (unless demand/luck suddenly deteriorates here, which is rather unlikely), versus current consensus of +9% to +10% year-on-year.”
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