U.S.-linked operators in the Macau casino market are benefiting from “held demand” after COVID-19-related restrictions ended in mainland China, Macau and Hong Kong, JPMorgan Securities said, citing comments from U.S.-based executives.
Thoughts on the Macau market were provided by Daniel Briggs, senior vice president of investment at Las Vegas Sands Corp, the parent company of Sands China Ltd and also a publicist at Marina Bay Sands Casino Resort in Singapore. , Accommodation, Restaurant and Leisure Management Access Forum in the United States this week. 경마
For Las Vegas Sands, which operates resorts linked to four Kotai game venues and runs properties on the city’s peninsula, the “first leg” of Macau’s market recovery “from the best value, wealthiest Chinese consumer who has supported premium bulk returns,” said a note update to the event by JP Morgan analysts Joe Greff, Omer Sander and Ryan Lambert.
Las Vegas Sands also said the group is expected to reach or reach 2019 levels for earnings before interest, taxation, depreciation and amortization (EBITDA), as it describes Macau as a growth in premium mass and VIP’s “incremental” business directly managed by the operator, not legacy junkets.
“What’s important is that given that Junket VIP was a 10% to 15% margin business considering the mixed transition, this should have a significantly higher EBITDA margin,” the JPMorgan team said, citing Las Vegas Sands management.
The premium sector in Singapore’s business also led to a recovery, with Las Vegas Sands taking the view that “there is still a bridge” as Chinese visitor numbers continue to improve in the city-state and airline capacity improves.
“China accounted for a third of Marina Bay Sands’ revenue in 2019,” JPMorgan said in a summary of management comments. “Local businesses have been helped by population migration to Singapore over the past few years, and are larger than ever, leading to very strong results in terms of slots,” he added.
In a separate note, JPMorgan noted that Win Macau’s market share was about 15% of total local game sales recently, “improving over 2019 levels without the need for a junket business.”
The management thought the market share increase in the properties of the new Wynn Palace in the Wynn Macau and Kotai regions on the city’s peninsula was driven by “providing premium rooms.”
“Both properties are operating in a more coordinated way, not an isolated approach than before COVID,” JPMorgan said, citing Wynn Group as saying that Macau’s leadership composition has recently been restructured.
JPMorgan also mentioned that Win Macau recently hired its chief marketing officer. This will help facilitate programming and visits across the two properties.
The agency added that it believes Wynn Group has a suitable opportunity to convert Macau’s Junket VIP players directly into customers.
A note on MGM Resorts’ contribution to the investor forum said MGM Macau and MGM China’s Macau operations, which operates MGM Kotai, “we believe market share will be sustainable in the mid-teens,” adding that the [Game] table’s expansion, post-split renewal and marketing programs help maintain market share above pre-pandemic levels.