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Las Vegas gaming companies sort out typhoon damage in Macau

Updated August 23, 2017 - 10:09 pm

Las Vegas-based casino operators are continuing to assess the damage from what’s being called the worst typhoon in 20 years in Macau.

Hato, a Signal 10 typhoon — the highest wind level storm in the Asian typhoon scale, with winds exceeding 100 mph — slammed head on into the Chinese gambling enclave with three American casino company operators at noon Wednesday.

At least nine people were killed in southern China, including five in Macau, according to Macau’s Government Information Bureau. It said 153 were injured in the enclave.

In Hong Kong, more than 450 flights were canceled, financial markets suspended and schools closed as Hato bore down, the first category 10 storm to hit the city since 2012.

“I’ve never seen one like this,” Garrett Quigley, a longtime resident of Lantau island to the west of the city, said of the storm.

“Cars are half-submerged and roads are impassable with flooding and huge trees down. It’s crazy.”

Many skyscrapers in the usually teeming streets of Hong Kong were empty and dark as office workers stayed at home.

In residential districts such as Heng Fa Chuen on densely populated Hong Kong island, waves smashed against the sides of oceanfront buildings and surged over a promenade, sweeping away walls and benches and swamping vehicles parked nearby.

Construction cranes swayed at the tops of skyscrapers, windows imploded and nearly 200 trees were uprooted, while some people used canoes to venture out into flooded streets.

Storm downgraded

Authorities downgraded the storm to a category three by late afternoon with government services, the courts, financial markets and companies set to resume normal business on Thursday.

It was believed to be the first time since Portugal’s transfer of Macau to the Chinese government that a Signal 10 typhoon warning was imposed.

“Our people on the ground in Macau said this was the worst typhoon they had seen in 20 years,” said Las Vegas Sands spokesman Ron Reese.

He said power was out on the Cotai Strip for a couple of hours, but has since been restored, although water systems have been impacted.

High winds launched debris through a glass window panel above a Starbucks coffee shop at Sands Cotai Central, but there were no injuries to 40 guests inside at the time.

Michael Weaver, a spokesman for Wynn Resorts in Las Vegas, said Wynn Macau on the enclave’s peninsula and Wynn Palace on Cotai sustained minor damage, which the company is continuing to assess. Weaver said both resorts are open and operating.

Union Gaming analyst Grant Govertsen said there could be long-term damage to ferry transportation between Hong Kong and Macau.

“Earlier in the morning, all ferry services were suspended and remained suspended as of early evening,” Govertsen said in a report to investors. “In fact, damage was done to both ferry terminals in Macau, which could delay the resumption of ferry service even longer.”

Ferry terminals operate on the Macau peninsula, closest to MGM Macau, Sands Macao, Wynn Macau and its sister Encore property. A second terminal on Taipa Island is nearest to Wynn Palace, Venetian Macao, Parisian Macao, Sands Cotai Central and the construction site of MGM Cotai.

Border crossings closed

Govertsen said border crossings were closed during the worst of the weather and flights out of local and regional airports were canceled.

“The typhoon resulted in significant damage across all parts of Macau and most outdoor spaces in Macau, casinos or otherwise, will require extensive cleanup over the coming days, while we would expect many roads to be closed as trees and debris are removed.”

Govertsen said various media outlets reported some casinos closed, but several operating with backup generators for power. Photos circulated of flooded casino floors at some locally owned or other foreign-owned properties. On some city streets, only the tops of some cars could be seen in the floodwater.

The Gaming Inspection and Coordination Bureau of Macau issued a statement urging casinos that are in parts of the city affected by the power outage to cease gaming operations in order to ensure the safety of customers and staff.

Govertsen said what had been shaping up as a good month for gross gaming revenue — there were two weekends of performances at the Venetian Macao by Hong Kong pop star Jacky Cheung — will likely be affected by the storm.

“Following today’s typhoon, we would expect the gross gaming revenue growth rate to take a couple hundred basis-point hit, which could easily become notably worse should power supply issues remain overnight and into the next day,” Govertsen’s report said.

Govertsen predicted the storm’s repercussions could ultimately hurt stock prices.

Wynn Resorts Ltd. shares were down $1.40, just over 1 percent, to $134.75 in Wednesday trading. After hours, the price dipped another cent in light trading.

Las Vegas Sands Corp. fell 68 cents, 1.1 percent to $59.89 on light volume with no change after hours.

MGM’s stock price closed down 28 cents, 0.9 percent, to $31.32 a share. In after-hours trading, the price rallied by 8 cents, 0.3 percent, to $31.40, on light trading.

The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson.

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

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