April’s 21.9 percent year-on-year growth rate fell short of the 27 percent registered in the first quarter of the year and mid-month consensus expectations of around 25 percent, reflecting a traditional slowdown towards the end of the month prior to the Golden Week holiday at the start of May.
Achieved on an unfavourable calendar, with one less Friday and Saturday compared to April 2011, and a tough prior year growth comparable of 48 percent, the MOP25.0bn gaming revenue figure was boosted by a maiden contribution from new market entrant Sands Cotai Central, which opened on April 11.
GGR on a per-day basis surpassed the MOP800m mark for the fourth consecutive month, with daily takings of MOP833m ($105m) representing the metric’s third highest ever level (in line with February’s MOP837m but well short of last October’s MOP866m).
Grant Govertsen, an analyst at the Macau arm of Union Gaming, wrote on Wednesday that Macau’s strength in daily GGR in the year-to-date “sets the tone for the balance of 2012”, with the daily GGR run-rate expected to spike in May due to an influx of visitors during the Golden Week.
Though May will include the first full month of contributions from Sands Cotai Central, the analyst believes that “ongoing construction disruption … will keep the property from reaching its full potential this year”.
It was last week suggested that Las Vegas Sands management’s reluctance to discuss early metrics from the property on a conference call accompanying the firm’s first quarter results may hint at a less than exceptional start to life for the Cotai venue.
With gaming revenue up 25.7 percent in the year-to-date, the Macau-based Union Gaming analysts believe that the enclave is still on track for growth of 20 percent plus in 2012, stating: “In order to achieve 20 percent plus growth for the year, monthly GGR will need to average MOP27.8bn ($3.5bn) for the balance of the year.
“This is 12 percent higher than the average YTD monthly GGR, which we think is achievable based on historical trends (each of 2011 and 2010 May-Dec monthly GGR was 20 percent higher than Jan-Apr), and is backstopped by new supply (Sands Cotai Central) that should help grow the market.”
Wednesday’s DICJ gaming revenue announcement came following the news that Macau’s government has formally approved Wynn Macau’s application to build a casino resort in Cotai.
In a separate note to industry followers, the Union Gaming team wrote: “We would estimate an end-of-2015 opening for Wynn’s Cotai project, or roughly six months later than Galaxy Macau Phase II … We expect a capital investment of $2.5bn to $3bn, which will be financed by a mix of FCF and debt.
“The finished product is likely to include up to 1,600 rooms (900 suites), up to 500 tables games and 1,300 slots machines. The remaining undeveloped land of about 12 acres could ultimately be used for a second phase, or a standalone project.”