Macau’s gross gaming revenues continue to drop in AprilThe month is expected to be the weakest one since September 2020A Bernstein analysts says that the situation won’t improve anytime soon
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While the COVID-19 pandemic has winded down in the Western world, China is experiencing a new wave of COVID-related hurdles. The situation has hugely affected the special administrative region of Macau, leading to a 25% drop in its gross gaming revenues (GGR).
Macau’s Results for April Are Expected to be the Lowest since September 2020
Bernstein analysts report that the 25% drop has been recorded in the period between April 11 and April 18. Translated into currency, this drop has cost Macau $9.3 million. Macau’s GGR for the period April 1 – April 18 sits at $197 million, with the region earning about $11 million a day. These numbers show a dramatic year-on-year drop compared to Macau’s results in 2019 and 2021 when it earned 89% and 68% more respectively. This drop notably marks the worst period for Macau’s gambling industry since September 2020.
The tendency of decline continues as analysts predict that the final mass GGR results will see a 30% drop compared to those in March 2022 and the VIP GGR will be roughly 25% lower.
As of now, there are an estimated 55 million people in China who are under some form of quarantine. The strictest anti-COVID measures are in Shanghai where countless people are prohibited from venturing out, regardless of how urgent their reasons might be.
Analysts Say that the Situation Will Not Improve Anytime Soon
Vitaly Umansky, a professional analyst for Bernstein, said that the situation in Macau will not get any better in the foreseeable future. He noted that the anti-pandemic measures are the main factor that impairs the gambling industry. Right now, visitors from 40 Chinese cities and 23 Chinese provinces must quarantine when they enter Macau. While the measures were recently eased off a little bit, they still discourage travel and by extension undermine the industry.
Umansky reported that there is a slight rebound in visitation but the majority of the visitors aren’t casino visitors. Furthermore, certain cities in the Guangdong province still struggle to deal with the pandemic and are reporting local cases. Umansky warned that a new COVID outbreak in the city of Zhuhai and/or in Macau could force the special administrative region to tighten its entry policies or completely close its border.
Umansky said that he expects that the final gross gaming revenue for April this year will be 88% lower than the one in April 2019. He projects that the final results will see a 23% drop compared to March 2022 when the industry earned $459 million.