Mass growth catching VIP in 18Q1

VIP revenue was again the fastest growing segment in Macau in the first quarter of 2018, though figures released by the Gaming Inspection and Coordination Bureau show that the mass market is catching up.

VIP GGR was up 21 percent compared with the same period a year earlier and up 5.7 percent from the prior quarter. Mass table GGR grew 20 percent year-on-year and also gained 5.8 percent from the prior quarter. Revenue from slots gained 17.9 percent.

Total GGR for the quarter gained 20.5 percent.

Union Gaming analyst Grant Govertsen said the figures are good news.

“VIP growth remains strong yet not sky high and therefore is more sustainable from a business perspective while also being more politically acceptable, and the profit engine that is the mass market segment is more robust than many had given it credit for when the year began and remains robust as summer approaches,” he wrote in a note.

The firm estimates that 62 percent of total GGR was generated on Cotai, with 38 percent on the Peninsula. It also points out that the Cotai strip holds a particular pull for the mass market traveller accounting for 64 percent of mass revenue. For VIPs 59 percent of revenue was from Cotai.

“We expect the delta between Cotai and peninsula to widen slightly this year even as we expect GGR on the peninsula to experience high single digit growth,” Govertsen wrote.

Union Gaming adds that based on conversations with operators over recent weeks and months, there has been an uptick in mass foot traffic and that trend is continuing into 18Q2.


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