Macau casinos struggled in June. Last month, gross gaming revenue (GGR) tumbled 37 percent from May.
The Macau Gaming Inspection and Coordination Bureau revealed that the six commercial casino operators won MOP6.5 billion (US$820 million) in June. That number is 73 percent lower compared with the pre-pandemic June 2019.
Gaming analysts got it right, as a note from Bernstein last month called for June GGR to drop just shy of 40 percent from May.
In line with expectations,” Bernstein said today of the $820 million win.
While June showed that Macau is far from returning to pre-pandemic gaming levels, June 2021 nonetheless was much better than June 2020, when casinos won just $89.5 million — the lowest monthly total incurred throughout the entire pandemic.
Macau casino stocks reacted positively to the June revenue report. Las Vegas Sands, MGM Resorts, Wynn Resorts, Melco Resorts, Galaxy Entertainment, and SJM Resorts were all trading higher this morning.
Macau, the world’s richest gaming market, isn’t rebounding from the devastating economic impact of COVID-19 nearly as quick as other key casino areas.
For instance, Nevada casinos experienced a record revenue month in May, GGR there totaling $1.23 billion. That’s the state’s all-time highest casino win ever for a single month.
Analysts and casino execs cite extraordinary pent-up demand for the tourism and gaming rebound. But in Macau, that pent-up demand remains pent-up, as traveling into the isolated Special Administrative Region (SAR) remains difficult for nonresidents.
Macau is slowly beginning to ease its strict quarantine requirements. Currently, only people arriving from Hong Kong, Taiwan, or mainland China can enter the enclave.
Even with a negative COVID-19 test, Macau has been requiring travelers from certain parts of Guangdong, a major feeder source for the enclave’s casino resorts, to quarantine for 14 days or longer. In mid-June, Macau announced that the cities of Shenzhen and Maoming were no longer included in the mandatory quarantine list.
Quarantine easing has analysts optimistic. JPMorgan is forecasting that July GGR will range between $1.38 billion to $1.5 billion. That would mark a roughly 83 percent month-to-month surge.
Through the first six months of 2021, Macau casinos have won MOP49 billion (US$6.13 billion). While that’s 812.5 percent better than what the gaming properties generated through the first half of the year in 2020, it remains down from 2019.
At this time in 2019, Macau GGR stood at MOP149.5 billion (US$18.7 billion).
Some good news broke this week. Officials in Macau and Hong Kong confirmed that the two sides are nearing a deal to allow for quarantine-free cross-border travel. Hongkongers, as early as this month could be permitted to visit Macau’s integrated resorts without quarantining.
That will only happen, though, if new cases of COVID-19 do not arise in either SAR. Prior to the pandemic, Hong Kong accounted for about 20 percent of Macau’s visitor traffic.