Inside Asian Gaming

IAG SEP 2021年9月 亞博匯 10 www.asgam.com Ben Blaschke Managing Editor We crave your feedback. Please email your comments to bb@asgam.com. Macau in position to open the flood gates EDITORIAL M ore than 18 months after COVID-19 first made its presence known in Macau, it seems we’re still taking one step back for every two steps forward. Certainly the latest setback afflicting mainland China – an outbreak that began in Nanjing before stretching to 16 other provinces – was ill-timed, with Macau’s gaming operators having finally started to see some genuine signs of recovery in their visitation and revenue numbers. Yet there remains good reason to be optimistic – not only for a long-awaited rebound but more encouragingly for an overweight response once borders begin to open up properly towards the end of this year (and into 2022). One needs only look as far as the United States for guidance. The theory of pent-up demand has been widely referenced since the start of the pandemic, but if there is one thing the US has shown in recent months it’s that such pent-up demand is real. According to figures published by the American Gaming Association in August, US commercial gaming revenue reached US$13.6 billion in the threemonths to 30 June 2021, smashing the previous quarterly record by more than 22%. It also means that with a cumulative total of US$24.8 billion through the first six months of 2021, the US is on track to overtake the US$43.6 billion reported in 2019 as the highest- grossing year ever for commercial gaming revenue. Macau has not yet returned to such heights, hampered by COVID spot fires across mainland China and in Hong Kong which have prevented a full reopening of borders (arrivals from Hong Kong are still subject to two weeks in quarantine despite talk of a “blue health code” system for vaccinated travelers). There have, however, been hints along the way that the high-end Chinese customer is ready and waiting to return to Macau with a bang as soon as the opportunity presents itself. Sands China COO Grant Chum said as much during the company’s 4Q20 earnings call in January, when he noted that retail sales in the Four Seasons mall had exceeded 4Q19 by 16% despite only a fraction of visitation having returned. “We had the best month we have ever had in Four Seasons mall tenant sales [in December] … pre- and post-pandemic, a record month,” Chum said at the time. More recently, Wynn Macau has experienced similar growth in its high-end gaming and luxury retail segments, including a brief surge during May Golden Week in which the company printed EBITDA of US$3 million per day. Retail revenues at Wynn Palace climbed by 50% to 70%, and high-end luxury retailer LVMH is currently outfitting nine new outlets at Wynn properties in Macau, according to CEO Matt Maddox, before being impacted once again by tightened border restrictions. Clearly the path ahead remains rocky, but the evidence suggests that when recovery truly does take hold it will be more tidal wave than trickle.