Macau Casino Revenue Rises 26% to $2.5BN in JuneJuly 3, 2017 11:19 am
China’s only legal gambling hub saw its revenue rise by 25.9% to 2.49 billion in June compared to the same month last year, according to the latest information released by Macau’s Gaming Inspection and Coordination Bureau. As a result, Macau has now followed 26 months of falling revenue with an 11th- straight month winning streak, with a return to double-digit growth having started in February.
The slight fly in the ointment, however, is the fact that a survey of 11 analysts predicted a revenue surge of between 23% and 33% for June, with last month’s result subsequently coming in at the lower range of their forecasts. Following the release of June’s results, the shares price of two of the resort’s top casino operators noted a fall, with Galaxy Entertainment lower by 3.2% and Sand China off by 2.1%.
Helping to explain some of the reasons behind June’s lower than expected growth is the anti-corruption campaign initialized by the Chinese government, which has led to a sharp reduction in the number of high rollers visiting the island’s gambling venues. Instead, casinos have increasingly been targeting mass market visitors, but even so a new facial recognition system installed last week at 680 ATMs designed to curb money laundering is also having a negative impact on the casinos’ bottom line. As a report by Reuters explains:
“Operators are cautious about the resurgence of VIP revenue, which is highly volatile compared to the more stable flows from mass market customers. VIP punters are typically brought in by middlemen known as junket companies. While the VIP sector contributes just over half of Macau’s total casino revenues, junket patrons have been subject to greater legal scrutiny due to concerns over money laundering.”
Consequently, Macau’s casinos, with the encouragement of the Chinese government, have increasingly been developing their non-gambling attractions in order to diversify their tourism market. Some of Macau’s many attractions include a plethora of Broadway-style shows, as well as a giant Golden Reel Ferris wheel in Studio City.