Macao July casino revenue rises but fails to meet expectations

Gross gaming revenue in Macao in July surged upward from June and from a year ago but failed to meet Asian analysts’ expectations.

A U.S.-based gaming industry analyst thinks those factors won’t affect investment there.

Macao’s Gaming Inspection and Coordination Bureau on Sunday reported revenue of $1.055 billion (U.S) from the region’s 41 casinos. That’s a 528.1 percent increase from July 2020 and 29.2 percent more than gaming in June. Analysts anticipated an increase of 540 percent from last year.

For the first seven months of 2021, revenue is up 63.9 percent from last year to $7.178 billion (U.S.).

Macao revenue is important to the Las Vegas market because three Las Vegas-based companies — Las Vegas Sands Corp., Wynn Resorts Ltd. and MGM Resorts International — have properties there that generate high levels of earnings for them. Sands is the market leader with six properties.

Sands is counting on Macao to drive the company in the future as it exits the Las Vegas market late this year or in early 2022. Sands struck a $6.4 billion deal with Apollo Global Management Inc. and the Vici Properties Inc. real estate investment trust to sell the real estate and cash flow of The Venetian, Palazzo and the Sands Expo Center.

While many Asian analysts are looking ahead to the renewal of licenses, scheduled for mid-2022 — a process that could be delayed by Macao’s government — U.S. analysts are assessing how the COVID-19 pandemic continues to affect visitation to Macao.

Macao continues to be affected by cross-border mobility, but that could change with higher vaccination rates in mainland China.

“Overall, we don’t think these results will faze investors, as monthly results reflect a slight drop-off over the last week, which isn’t surprising as increased cases of COVID-19 across the border emerged,” said Joe Greff, an analyst with New York-based J.P. Morgan.

“Although this figure is not as strong as the result in May of $1.305 billion (U.S.), it is still the second highest gross gaming revenue since February 2021,” he said. “We suspect the near term will be impacted by cases popping up in several regions and is beginning to have an impact on bookings.”

The Review-Journal is owned by the family of Dr. Miriam Adelson, the majority shareholder of Las Vegas Sands Corp., which operates six properties in Macao and one in Singapore.

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