New | Macau gaming revenue falls for 6th month in a row, outlook glum

Macau gross gaming revenue fell 19.6 per cent in November, down for the sixth straight month although it was in line with market expectations as the city reported its first economic contraction in the third quarter since 2009.

November casino revenue in the world’s largest gambling hub was 24.3 billion patacas (HK$23.6 billion), dragged down mainly by a corruption crackdown and a slowing mainland China economy. It follows a 23.2 per cent decline in October, the largest on record since the government started collecting data in 2005.

Macau’s gross domestic product for the three months ended September fell 2.1 per cent from a year earlier, the city’s Statistics and Census Service said. Year to date, revenue is up 0.3 per cent. Government and market revenue estimates for the full year are flat.

On November 18, Macau’s secretary for economy and finance Francis Tam Pak-yuen said that he expected 115 billion patacas in gaming tax revenue for 2015, or “roughly the same” as the year before. Tam also mentioned the government had been cautious in drafting the coming year’s budget given the steady decline.

“This weakness is born both by VIP and mass (market segment). We’re looking at mass falling into the negative as well for November,” Daiwa Capital Markets Hong Kong analyst Jamie Soo said before the announcement. “Not only are we expecting overall decline in revenue but increasing costs.”

The six Macau casino operators face increasing wages and a labour crunch as new casinos on the Cotai strip start opening middle of next year.