Macau

 

A subsidiary of Australian-based Leighton Holdings, Leighton Asia, has been chosen by Wynn Macau (1128:HK) to design and build its maiden property in Cotai.  The contract value is reportedly worth USD $231 million.  Leighton has already been involved in several Macau projects, including Wynn Macau, Wynn Encore, Macau Fisherman’s Wharf and City of Dreams.

 

 

Average Daily Table Revenue (ADTR) was USD 99.9 million last week, which is below the first two weeks of the month, but expected due to the pre-Chinese New Year timing. The partial smoking ban allows casinos to have smoking areas in up to 50% of the gaming floor area, though the rules do not stipulate the minimum number of slots and tables to be included in smoking and non-smoking areas. Since January 1st 2013, 9000 people have been fined for smoking in public areas. 

 

 

Gambling revenue in Macau rose 7.3 percent in January year-on-year, riding on the waves of mainland punters. January's revenue at USD $3.4 billion was slightly weaker than analysts' forecasts of 10-12 percent growth. Macau raked in $38 billion in annual gambling revenues last year. Seasonally gambling revenue dips ahead of the Chinese New Year holiday period, which this year starts on February 10, and accelerates again once the holiday season begins, Reuters reports.

 

The smoking ban that took effect on the first day of the year is creating grief across the industry. Operators, faced with last minute guidelines but not with the "customary" grace period to revamp gaming halls and rosters, are getting fined for non compliance. Employees want to be given the option to work in smoke free areas, albeit with fewer posts available since most activity is still concentrated in the smoking areas. The Chief Executive, Chui Sai On also asked the public for "understanding" in implementing the changes (stay tuned to AGB for more on the issue).

The Macau government will soon renew the contract with Sociedade de Lotarias Wing Hing Lda albeit with some changes. The company has held the monopoly for Chinese Lotteries in Macau - commonly known as Pacapio - for decades

Citic Telecom International Holdings Ltd. (1883:HK) has decided to buy 79% of Macau phone operator CTM for the noteworthy amount of USD $1.16 billion. While Citic certainly sees the landline phone monopoly as a relatively stable revenue source, the real profits to be had are expected from Internet and wireless services, as Macau residents and visitors are pushing the demand for quick mobile gambling access. Mobile phone ownership is already three times higher than the area's population of 568,000 inhabitants, so the demand is clearly very intense.

Melco Crown Entertainment Ltd. (Nasdaq: MPEL), the second-most expensive Chinese casino stock after last year's 75 percent surge, will extend gains as recreational gamblers in Macau drive revenue growth, according to Union Gaming Group. Melco-Crown, a joint venture between Australian billionaire James Packer and Lawrence Ho, son of gambling tycoon Stanley Ho, has doubled its ADR price since reaching a seven-month low in July.

The table cap for operating properties - currently set at 5,500 for the 2011-12 biennium - shall be increased in 2013, the Macau Secretary for Economy and Finance said. Francis Tam Pak Yuen added that operators' non-gaming facilities would be taken into account when deciding the number of tables to be allotted to new properties approved for Cotai. Wynn Macau (1928:HK), MGM China (2282:HK), SJM (880:HK) - and potentially Melco-Crown (Nasdaq: MPEL) under StudioCity - have projects in the pipeline.

Pages