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It’s like old times for Macao: Gaming revenue hits 2023 high in May

It seems like old times in Macao.

Casinos in the Chinese enclave reported gross gaming revenue of $1.93 billion for the month of May, the special administrative district’s Gaming Inspection and Coordination Bureau reported Thursday.

For the month of May, the bureau said Macao’s 39 casinos generated totals that were 365.9 percent ahead of May 2022.

For the first five months of the year, Macao reported $8.052 billion (U.S.), a 172.9 percent increase over the first five months of 2022.

Battling back since January from shutdowns and restrictions imposed last year by the Chinese central government, Macao’s gaming revenue hit its highest monthly total of this year, the bureau said.

Analysts were impressed that casino play continued to grow in May, even after a holiday period known as Golden Week that normally results in a post-holiday lull.

“Macao’s gross gaming revenue grew by 6 percent month over month (from April),” gaming industry analyst Joe Greff of New York-based J.P. Morgan said in a report to investors Thursday. “On a per-day basis, this implies a strong … level, reflective of a strong continued recovery, both during the Golden Week holiday to begin the month and a decent level of gross gaming revenue post the holiday, when there is traditionally a post-Golden Week slowdown. Overall, this is an encouraging monthly result and we believe it’s supportive of our positive thesis on Macao’s encouraging recovery since Macao and China effectively reopened since early January.”

The rebound is important to three Las Vegas-based companies — Las Vegas Sands Corp., Wynn Resorts Ltd., and MGM Resorts International, which all have a resort presence in Macao.

Sands recently celebrated the relaunch of its new Londoner resort with a special entertainment-filled ceremony last week.

“We’d point out that the May calendar wasn’t exactly easy given a shift in Golden Week to April 29-May 3 this year, versus May 1-4 in 2019, but the momentum remained as solid as April (which had a favorable calendar) with gross gaming revenue at 60 percent of 2019 levels,” Greff said.

“We believe the math here is that the mass gross gaming revenue segment has recovered to more than 85 percent of pre-COVID levels (also same as April’s), which is impressive given travel infrastructure that is not completely back to pre-pandemic levels,” he added.

At its lowest level, in July 2022, Macao’s casinos produced $49.4 million in gaming revenue. But Macao’s government renewed licenses with casino vendors last year and directed licensees to invest billions of dollars more in non-casino amenities in the years ahead.

Greff and other analysts are recommending Sands, Wynn and MGM shares in their reports to investors.

“We reaffirm our positive views on the Macao sector and see recent China-macro driven pullbacks in the U.S.-listed Macao equities as very attractive given these recovery trends,” Greff said.

The Review-Journal is owned by the Adelson family, including Dr. Miriam Adelson, majority shareholder of Las Vegas Sands Corp., and Las Vegas Sands President and COO Patrick Dumont.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.

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