Macau Luring VIPs Following Coronavirus Closure, But Not Enough to Boost GGR
Posted on: May 26, 2020, 07:51h.
Last updated on: May 26, 2020, 12:13h.
The coronavirus pandemic isn’t keeping some high rollers away from Macau. But their visitation and spending numbers weren’t enough to prop up the Special Administrative Region’s (SAR) gross gaming revenue (GGR).
A study by the Macau Research Center, which covered the late March through May period, indicates the bulk of visitors to the gambling hub during that time frame hailed from mainland China, with most being classified as VIPs.
Compared to the mass market, the spending decisions of this group of high-end customers may be less influenced by macroeconomic and social sentiment,” according to the Macau Research Center study.
Data from the center indicates that nearly 60 percent of those surveyed visited Macau specifically to gamble, while 87 percent participated in gaming activities. Those polled spent an average of almost $11,000 on wagering during their visits to the gaming hub and $5,633 on dining, hospitality and other non-gaming amenities.
Travel Still an Issue
While some high rollers remain devote to visiting to Macau, GGR there slumped about 98 percent last month as harsh travel controls keep gamblers – both VIPs and mass market – at bay. Pivotal to getting Macau’s gaming business back to normal is the resumption of travel with Hong Kong.
“During the research period, visitors who traveled to Macao via the Hong Kong-Zhuhai-Macao Bridge (HZMB) have spent 4,280 Macao Pataca (MOP) per head on average, 32% (MOP 1,038) more than those who arrived through sea ports,” notes Macau Research Center. “In addition, visitors who arrived in Macao via the HZMB spent more than double (117%) on shopping, as well as 40% more on entertainment than those who traveled to Macao through sea ports.”
While there is talk of progress on easing of travel restrictions between Macau, Guangdong province, and Hong Kong, a recent spate of political volatility between Hong Kong and Beijing could throw a wrench in those plans. Last week, Hong Kong markets slumped, and protests picked up on news China is looking to limit the SAR’s autonomy, potentially ending the long-running “two systems, one country” way of doing things.
Who Benefits From Devoted VIPs
The center’s study found that 70 percent of those surveyed believe Macau is taking adequate measures to guard against the spreading of COVID-19. The SAR has 45 confirmed coronavirus cases and no fatalities.
As for the operator beneficiaries of VIPs’ devotion to Macau, Melco Resorts & Entertainment and Wynn Resorts come to mind, as they are two of the more high roller-dependent companies on the peninsula. Melco won market share from rivals in the first three months of the year due in large part to some strength in the VIP segment.
On the other hand, Las Vegas Sands, the largest Macau operator, caters more to mass and premium mass players. Still, analysts remain enthusiastic about the Parisian Macau owner, saying it’s likely to gain market share in its own right as travel trends begin to normalize.