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Macau gaming revenue down 36% in August

Discussion in 'Casino Industry & Development' started by Mirageluvr, Sep 1, 2015.

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  1. Mirageluvr

    Mirageluvr Low-Roller

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    Based on China's economic issues/stock market the September numbers could make these numbers look good. Tough times!

    Macau gaming revenue down 36% in August


    Sep 1 2015, 07:36 ET | By: Clark Schultz, SA News Editor


    Macau casino revenue fell 35.5% to 18.62B patacas ($2.3B) in August after falling 34.5% in July. The mark was better than the consensus analyst estimate for a 37.8% drop.
    Though new properties in Macau are expected to come on line this fall to help boost traffic, new public sector austerity measures and a continued crackdown by authorities on corruption will pressure traffic and revenue.
    Macau casino stocks: Wynn Macau (OTCPK:WYNMF, OTCPK:WYNMY), Sands China (OTCPK:SCHYY, OTCPK:SCHYF), MGM China (OTCPK:MCHVF, OTCPK:MCHVY), Galaxy Entertainment (OTCPK:GXYEF), SJM Holdings (OTCPK:SJMHF, OTCPK:SJMHY), Wynn Resorts (NASDAQ:WYNN), MGM Resorts (NYSE:MGM), Las Vegas Sands (NYSE:LVS).
     
  2. lithium78

    lithium78 High-Roller

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    Those numbers make Atlantic City look a lot better.
     
  3. Gargamel

    Gargamel Low-Roller

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  4. boogaloobboy

    boogaloobboy Tourist

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    How much of this supposed "revenue" was actual in the first place? Tons of it was junket funny money that was never collected when it came due, yet they paid out if you won. It was like a giant free play extravaganza. Anyone who bought these stocks when they were being propped up by Macau earnings had a base misunderstanding of the business in that arena IMO. With all the new rooms opened its going to get very, very ugly. The funny part is two years ago Wynn was being held up as a world class genius and MGM were idiots for missing this boat, now it looks like Macau is a black hole of money. So bizarre.
     
  5. leo21

    leo21 VIP Whale

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    MGM is there. CET was the idiot for missing the boat. And even though revenues overseas are down right now, they are still idiots for missing the boat. The money coming in at the time the time of the recession would have really helped with their debt. I won't say they wouldn't have gone into bankruptcy eventually but it may have kicked it further down the road. Wynn used a lot of Macau money to pay Encore debt and for Sands, it help with Palazzo. It will take a heck of a lot more to help MGM pay off City Center but it has helped them too.

    I think a lot of gaming companies have been banking on overseas money, whether its having operations in Asia or foreign guests coming in. China is not the only economy in distress. Let's see Vegas foresaw this downturn and is prepared to face it head on.
     
  6. Krh2o

    Krh2o MIA

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    That's not accurate. The revenue was real. No way LVS or Wynn top execs would commit some Enron level fraud to show revenue that wasn't there. The junkets were suspected of money laundering so that's why they have been scaled back. The junkets paid the casino, now whether or not the junkets were paid back is another story. The casinos did not lie about their top line revenue. Also MGM has a market cap of around 11 billion dollars. LVS which only has Venetian and Palazzo in Vegas has a market cap of 36 billion. Macau might be way down, but it is still a huge money maker.
     
  7. natedog666

    natedog666 17 and 20 Expert

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    I would be interested to know how they book the revenue though. I know they suffered a lot of bad debt write offs from people extended credit but could not pay. Since a lot of junkets were on revolving credit as well, I would be curious what happens when they go belly up...

    Remember credit over there is not like Clark county, where they can go after you in the U.S. Criminally. Over there there's little legal recourse when you play on credit and can't pay.
     
  8. Krh2o

    Krh2o MIA

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    That makes sense, I was just under the impression that when a publicly traded company reports revenue, that has to be money received. I think now that the crack down has started, thats why this revenue is going down so much. I just hope they can sustain their dividend.
     
  9. Krh2o

    Krh2o MIA

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    oops.
     
    Last edited: Sep 2, 2015
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