Macau GGR results in August still a disappointment, growth in 2016 unrealistic: DB

Despite Macau’s gross gaming revenue results beating expectations, August’s overall result was disappointing with growth in 2016 seeming “unrealistic,” according to Deutsche Bank analysts.

Gaming revenue fell 35.5 percent last month to MOP18.62 billion ($2.33 billion), which was “a hair better than expectations stemming from recent checks, but a disappointment relative to prior expectations as the “levels of less bad” thesis hit a speed bump,” DB said in a note.

As of August 23, results for the month were tracking to a range of down 36.5 to 37.9 percent year-on-year.

“The August result snaps a string of 5 consecutive months in which the year over year decline was less than that of the prior month. The result is essentially flat on a sequential basis, relative to July.”

The note added that over the last three months, the average USD win per day in the market has been about $74 million, compared with $90 million in 15Q1. Taking this into account, and other factors, growth in 2016 appears unrealistic

“Assuming limited aggregate incremental demand from the Studio City opening in late October and barring an unforeseen turnaround in the market, we believe the 1Q16 is poised to start the year with, at minimum, a high teens y/y decline and hence we continue to find expectations for growth in 2016 to be unrealistic.”