News that Macau’s gross gaming revenue (GGR) in November fell by 32.3 percent year on year comes as harsh reality check for an industry which only a month earlier had been cautiously celebrating some small signs of recovery.
October’s GGR fall of 28.4 percent had been the smallest since January and the first of less than 30 percent in 2015. Combined with the first month of operation for Melco-Crown’s newly opened resort Studio City, the general consensus was of some light at the end of the tunnel.
Not anymore. November’s GGR of MOP$16.43 billion was the lowest total since September 2010 and suggests there are still plenty of dark days ahead before earnings start to pick up again.
However, even with 18 consecutive months of declining revenue it is apparent some analysts are getting carried away with the doom and gloom scenario. That much was apparent in an observation by Bloomberg Intelligence analyst Tim Craighead stating that, “The ongoing pressure on the high-roller business hasn’t been offset by mass market stabilization.”
While Macau’s mass market is growing, nobody has ever suggested it would cover the decline in VIP revenue anytime soon so it seems somewhat redundant to paint the gap as some sort of disaster. These are strange times indeed.
