Macau gaming revenue plunges in Q3 while Manila slows down

A winning three-month period in Macau’s VIP rooms helped Asia’s premier gambling hub reach gaming revenues of MOP67bn ($6.2bn) from July to September 2017, rising almost 22% on a year-on-year basis.

According to data released by Macau's Gaming Inspection and Coordination Bureau (DICJ), the VIP segment increased 35% in the third quarter, with baccarat leading this expansion. Gross Gaming Revenues (GGR) in VIP baccarat plunged 57.7%, approximately MOP38.69bn ($4.81bn), compared to same period previous year.

Aside from high-rollers, mass-market revenues rose nearly 8% in Q3, reaching MOP28.32bn, compared to MOP26.36bn in the prior-year period. Mass-market baccarat, which accounts over 30% of all casino GGR, surpassed MOP20.88bn ($2.6bn), increasing 7% year-on-year.

Slot machines reported revenues of MOP3.22bn ($300m) during the 92-day period, jumping 13.4% compared to MOP2.84bn generated last year.

Shortly after the release of Macau’s results, more countries in South East Asia posted their financial figures for Q3. After a successful second quarter for the four large-scale private-sector casino operators currently running in Manila, Morgan Stanley said it expects declines of up to 10% in revenues in the Philippines during the July-September period.

According to Morgan Stanley analysts, this drop will be followed by decreases of 8% in EBITDA for three out of the four Manila venues. The investment bank said that EBITDA at Bloomberry and Melco Resorts will be down 5% and 10% respectively. This may have been caused by hefty declines in VIP revenues, 12% for Bloomberry and 27% at City of Dreams Manila, operated by Melco.

The third casino to experience negative numbers is Resorts World Manila, the venue controlled by Travellers International, which is reported to record flat EBITDA in the July-September period. Due to the removal of VIP and mass-market tables on the second floor, GGR at Resorts World could dip down to 9%.

Despite this slow performance, Morgan Stanley remains optimistic and still expects a strong fourth quarter to close 2017.