Macau gaming revenues increase 12.3 percent in September

Macau's casino market ended a two-month trend of single-digit gaming revenue increases with a 12.3 percent jump during September.

Casinos in the only legal gaming market in China collected $3 billion from gamblers during September, Macau's Gaming Inspection and Coordination Bureau reported Thursday.

Single-digit increases are considered bad months in Macau, where gaming revenues hit a record $33.5 billion in 2011, a 42 percent increase over 2010. July's 1.5 percent increase in gaming revenue was the smallest uptick since July 2009.

Macau's market is approaching 40 large and small casinos, following this year's opening of Las Vegas Sands Corp.'s $4.4 billion Sands Cotai Central, a multi-hotel and casino development. MGM Resorts International and Wynn Resorts Ltd. also operate resorts in Macau.

Cotai Central has additional phases and Las Vegas Sands will have a two- to-three-year window operating the only new properties on Cotai.

"September Macau gaming revenue growth was slightly below the mid-teens whisper," Susquehanna International Group gaming analyst Rachael Rothman told investors. "However, the continued improvement of year-over-year trends is encouraging as we enter a fourth quarter that faces (easier comparisons) beginning in November."

The Macau market is up 15 percent for the first nine months of 2012 when compared with last year's record-setting figure. September's results fell below some analysts' expectations for growth, which were as high as 20 percent.

"We believe the last two days of the month were quite soft due to the timing of mid-Autumn festival, which fell on Sunday, September 30 this year," Union Gaming Group Principal Grant Govertsen said in note to investors. "With this very important family holiday now out of the way, we believe the first three days of October's Golden Week holiday period have been strong."

Stifel Nicolaus Capital Markets gaming analyst Steven Wieczynski agreed that mainland Chinese slowed their visitation to Macau during September ahead of Golden Week, which is considered a national holiday.

"Given the recent market headwinds encountered by Macau operators, particularly in the (high-end play) segment, we expect investors to pay particularly close attention to operators' commentary regarding visitation and play levels during Golden Week," Wieczynski said.

The numbers may have weighed on Las Vegas casino company stocks. In the face of a market rally, shares of Las Vegas Sands fell $1.01, or 2.19 percent, to close at $45.10 on the New York Stock Exchange. MGM Resorts International shares fell 10 cents, or 0.95 percent, to close at $10.47 on the New York Stock Exchange. And Wynn Resorts Ltd. shares fell 85 cents, or 0.74 percent, to close at $114.02 on the Nasdaq Global Select Market.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.
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