Deutsche Bank

    Deutsche Bank AG is a German global banking and financial services company with its headquarters in the Deutsche Bank Twin Towers in Frankfurt. It has more than 100,000 employees in over 70 countries, and has a large presence in Europe, the Americas, Asia-Pacific and the emerging markets.


    Karen Tang

    Karen Tang is the Head of Asian Gaming & Hotels Research at Deutsche Bank.She also covers the Hong Kong conglomerate stocks. For the past three years, she has been voted the No.1 Gaming & Lodging Analyst in the Institutional Investor survey. In 2011, she was also named Best Analyst in the Travel & Leisure sector by the Wall Street Journal for her stock-picking skills.Karen joined Deutsche Bank in 2003 and has more than 10 years of experience as a research analyst, previously covering the Hong Kong property sector. She graduated from the University of Cambridge, UK, with a Master's degree in economics.

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    Macau operators likely to keep licenses, but at higher cost

    Macau estimates cut again as recovery lags

    October proved to be another disappointing month for Macau’s gross gambling revenue, despite the annual Golden Week holiday, with analysts once again cutting their estimates for the year.

    Macau operator shares likely to improve: Deutsche Bank

    Shares in Macau's casino operators are likely to see continued improvement as traffic trends and gross gambling revenue performance improves, analysts at Deutsche Bank said.

    Typhoon Mangkhut dampened otherwise strong Sept GGR

    Macau GGR in September rose only 2.8 percent year-on-year – affected by casino closures during Typhoon Mangkhut and related disruptions. According to data from the Gaming Inspection and Coordination Bureau (DICJ), Macau GGR reached MOP21.95 billion, up 2.8 percent. The amount recorded in September represents a 17.3 percent decrease from August 2018, which recorded GGR […]

    July GGR headed for 10-12 percent YoY increase

    GGR performance recovered in the first week of July, due partially to two weekends and fewer World Cup matches falling into the period, said a note from Bernstein on Tuesday. Macau GGR MTD was MOP 6.6 billion for the July 1 – 8 period, with MTD ADR of MOP 825 million, up 10 percent year-on-year. […]

    DB lowers forecasts for Wynn Resorts

    Deutsche Bank analysts have trimmed their 18Q2 forecast for Wynn Resorts, due mainly to lower than anticipated VIP volumes, increasing competition, and the impact of the World Cup. “While we do not believe the World Cup or Euro Cup have had a meaningful influence on historical results, our checks indicate the proximity of this year’s […]

    Universal stock slumps after Wynn settlement

    Universal Entertainment shares slumped a further 13 percent Monday, continuing a decline triggered by last week’s settlement of a legal case with Wynn Resorts. The stock dropped from 6,250 yen before news of the settlement Thursday to 4,590 yen by the end of the day Monday, a loss of more than 26 percent of its […]

    Mass ramping up, Wynn and Melco to benefit

    Capacity expansion, ramp up of recently opened properties, transportation infrastructure improvements and strength of the Chinese premium consumer should continue to push up mass over the next five years, says Bernstein in a note on Tuesday. The brokerage said it has revised its estimates for 2017E-2022E CAGR to 8 percent for Total GGR, 6 percent […]

    Deutsche Bank upgrades Wynn as Palace ramps up

    Wynn Resorts has been upgraded to buy from hold by analysts at Deutsche Bank due to a ramp up in the mass sector at Wynn Palace after floor reconfigurations and ongoing strength in the VIP market. “Our checks give us confidence that the reconfiguration of the mass floor has stimulated improved mass play,” the bank […]

    Analysts watching for guidance on premium mass: DB

    Analysts are likely to be watching for any commentary from management on the performance of the premium mass sector during the upcoming round of quarterly results, according to a note from Deutsche Bank. Macau stocks have outperformed the market year-to-date, but the bank said it doesn’t believe there are any expectations for a lot of […]

    EBITDA targets achievable for 2017, Deutsche Bank says

    The consensus EBITDA forecasts for 2017 for Macau’s operators now look to be achievable for this year, after targets lacked harmony with gross gaming revenue growth throughout 2016, Deutsche Bank said in an analysis. The firm said that previously, forecasts for EBITDA has failed to take account of the cost pressures stemming from the opening […]

    DICJ boss predicts GGR revival in 2017

    Paulo Martins Chan, director of the Gaming Inspection and Coordination Bureau says he is hopeful for revenue growth in Macau’s gaming sector in 2017, local media reports. “Gaming revenue is expected to see stable development next year, and hopefully go upward,” Chan said in an interview with Bloomberg. “Macau has started to see healthy and […]

    Tabcorp, Tatts Group in merger talks

    Australia-listed Tabcorp and Tatts Group said on Tuesday that they are in talks to create a A$9.34 billion ($7.1 billion) betting giant, Reuters reports. According to an investment banker involved in the talks, a transaction could be announced within the next two days. Tabcorp announced a “Trading Halt Session” on Tuesday in a filing to […]

    Macau at the start of mass-led GGR recovery: DB

    Deutsche Bank‘s Karen Tang says Macau is on the cusp of a mass market recovery. The analyst, who conducted extensive interviews with “a dozen of casino service staff & premium mass hosts” says gaming spend per visitor has started to rise, and VIPs are returning as premium mass players, adding that Macau appears to be […]

    Macau Monetary Authority confirms UnionPay crackdown: Premium mass seen hit

    The Macau Monetary Authority has confirmed it is stepping up supervision of the use of China UnionPay cards in pawn shops in a move analysts say is likely to impact the premium mass market. The MMA in a statement Friday confirmed that it will be implementing real-time monitoring of mainland bank cards at high-risk merchants. […]

    Weaker-than-expected start for Macau Nov. GGR

    Gross gambling revenue in the first week of November is pointing to a weak start for the month, prompting analysts to revise down their forecasts. According to Bernstein Research average daily revenue in the week through to Nov. 8th was MOP 525 million ($66 million), lower than October’s MOP 647 million rate, mainly due to […]

    Deutsche Bank estimates Macau November GGR to drop 27.5 percent

    Deutsche Bank estimates November gross gaming revenue to decline 27.5 percent year-on-year, underpinned by a 35.1 percent decline in VIP revenue and a 16.2 percent decline in the mass market segment, inclusive of slots.  DB said in a note that its expectation for a 35.1 percent VIP revenue decline is predicated on a 50.0 percent […]

    LVS modest margin declines likely to accelerate: DB

    Las Vegas Sands 15Q3 results beat expectations due to continued cost cutting in Macau and a surprising upside in Singapore, but recent modest margin declines are likely to accelerate, Deutsche Bank said in a note. LVS’ adjusted net income decreased to $529.8 million, or $0.66 per diluted share, compared to $675.7 million, or $0.84 per […]

    Mass market holding up, but not helping profit margins, analysts say

    Macau’s operators are so far seeing little benefit to their bottom line from a shift in the business mix from the high roller to the mass market, though the mass segment does appear to be holding ground, analysts say. CLSA Research said after a series of investor meetings it is “assured” of the sustainability of […]

    Studio City looks set for 150 tables: DB

    Melco Crown’s Studio City may receive roughly 150 gaming tables from the government for its Hollywood-themed Studio City resort, a number that will now “serve as the baseline for expectations” for future openings in Cotai, said Deutsche Bank Securities. Analysts Carlo Santarelli and Danny Valoy said, “while not necessarily a big surprise, we do believe […]

    Deutsche Bank projects 2Q15 GGR will fall 32.9 percent

    Deutsche Bank has revised down its revenue forecasts for the 2Q15 and the entire year, projecting gross gaming revenue will fall to 32.9 percent and 25.9 percent, respectively. Second quarter revenue was previously estimated to fall 26.3 percent year-on-year, and full year revenue, 21.4 percent. “Our estimate for April is -36.9%. We are estimating 2Q15 […]

    Bursting stock bubble adds no fizz to Macau GGR

    When the mainland Chinese government's anti-graft campaign began to bite into Macau's gaming revenue last year, many analysts suggested the big players had fled to safer ground in the then-booming Chinese stock market.But that bubble has now burst, with the Shanghai Composite Index seeing its worst daily fall in eight years in August, sending shockwaves through global bourses. If that boom is now well and truly over, is there any argument for a corresponding turnaround in Macau?

    No end in sight to Macau slump as analysts cut estimates

    As the first quarter comes to a close, there seems to be little reprieve for Macau’s battered casino stocks, with analysts continuing to cut estimates on the back of weak Chinese New Year revenue and an ongoing stream of negative news. Although the February fall in gross gaming revenue was the worst on record at almost 49 percent, it wasn’t as bad as some had been expecting. Still the consensus is that the market has not reached a bottom as yet. Comments from both analysts and operators continue to reflect longer-term optimism, but agree there remains little near-term visibility. “February was very weak especially given Chinese New Year and a lot of analysts are revisiting their forecasts,” said Alex Bumazhny, an analyst at Fitch Ratings, which this week predicted a 4 percent decline for 2015 GGR. “The market is banking on a slow down in premium mass and on the whole it’s not looking so good for 2015.” It’s also unclear as to whether the regional operators which saw a sharp uptick in Q4 VIP revenue as high rollers fled Macau, will continue to benefit as China pledges no let up in its anti corruption drive. JP Morgan in a recent report cut its earnings and share price target estimates by 25 percent and said it now expects an 18 percent decline in 2015 GGR, while Deutsche Bank issued perhaps the most bearish forecast so far, predicting a 30 percent drop and slapping a sell rating on the Macau five operators apart from SJM Holdings, which was already rated sell. JP Morgan said it doesn’t expect a pick up in share valuations until April, pointing also to a series of regulatory overhangs in the market. Deutsche Bank says the GGR decline may extend into 2016. The Macau government will conduct an interim review of the gaming sector this spring and may provide more clarity on new table allocations to casinos. It is also likely to discuss the issue of inbound mainland visitors with Beijing and whether their movements will be further restricted. The government last year clamped down on transit visas to third country destinations and has said it may review the Individual Visa Scheme. “We believe the market would not give the benefit of the doubt, until such regulatory issues are proven to pass without any significant surprises,” the bank said. Citi is more upbeat, saying it believes the market may be at a turning point, but still sees no signs of recovery in the VIP sector. The firm recently cut its forecasts for 2015 market GGR to negative 16 percent, from its prior estimate for a drop of 4 percent. The Q1 results will follow on from a set of financial statements for Q4 that, while gloomy, were largely in line with expectations. “The results were more or less consistent with what we expected,” Fitch’s Bumazhny said. “Wynn lost some market share and that appears to have continued in Q1 which is a concern.” Wynn Macau, which currently has just one highly VIP focused property, posted the biggest drop in quarterly revenue so far. (Galaxy Entertainment will report on March 19th and SJM Holdings didn’t split out Q4 figures). Net revenues were $761.2 million, a 32 percent decrease from the $1.12 billion generated in the fourth quarter of 2013. Adjusted property EBITDA in the fourth quarter of 2014 was $241.2 million, down 35.5 percent. VIP turnover was down almost 40 percent, however the group has been renovating its casino floor which resulted in a drop in VIP tables to 244 in Q4 from 273 in the prior year. That renovation, which includes the addition of two VIP rooms and a new relationship with top junket operator Sun City, was scheduled for completion ahead of the Chinese New Year. Despite the weak Q4 for Wynn, analysts are generally reasonable bullish about its outlook. Sterne Agee’s David Bain wrote in a recent report that his buy recommendation on the stock remains intact and that investors have given little credit for its renovations and still less “to a top tier junket operator occupying one of its rooms that currently does not do business at its facility.” Bain and analysts at Citi also pointed to the fact that the opening of its new Wynn Cotai will be transformational for the company. Citi said the new property is likely to be the “premier” resort on Cotai, although the company indicated in its Q4 earnings call that the opening may be delayed. MGM China’s Q4 was also weaker than most had expected. Revenue fell 22 percent to $719 million, while adjusted EBITDA dropped 22 percent to $185 million. Like Wynn, MGM also cut Macau VIP tables in the quarter to 195 from 235. VIP table games revenue dropped 39 percent, while mass floor revenue jumped 19 percent, reflecting an increase in main floor games up to 228 from 195. UBS analyst Robin Farley points out the mass performance in the quarter was “impressive,” above the firm’s 18 percent growth forecast and the market consensus for a drop of 16 percent. The group said it remains on schedule for the planned opening of MGM COTAI in 2016. The expected total development cost is approximately HK$23 billion, excluding land costs and capitalized interest. It also announced plans to spend $100 million on revamping the main floor at its existing MGM Macau. Sands China as expected benefited from its bias towards the mass market and its higher capacity than other operators. Total net revenue declined 16.2 percent in the quarter to $2.12 billion, while adjusted property EBITDA decreased 14.7 percent to $713.2 million. Mass revenue was down 9 percent, while premium mass was down 17.5 percent. VIP volume was down 42 percent. “In Macau, we like its peer-high weighting to mass gaming (higher visibility and margins than VIP), peer-high hotel room capacity amidst strong visitation growth and gaming position lead in Cotai,” Sterne Agee’s Bain said. The company noted on its earnings call that there is room for improvement to its Q4 margin of 34 percent going forward, as the drop in the mass market was so rapid towards the end of the year that it had not had time to adjust expenses. However, analysts also noted that the company is no longer giving a specific time frame for the opening of its Parisian Macau resort, saying that the target remains “sometime in 2016.” UBS’ Farley says that the U.S. casino giant will need the Macau government to approve more labor to achieve that date. Melco Crown saw its Q4 revenue drop 20 percent, although again analysts are slightly more upbeat about the company’s prospects given the opening of its Studio City property later this year. The consensus view is still that added capacity will drive growth, although Deutsche Bank’s latest note even casts doubt on this theory. The opening of two new gaming venues this year isn’t expected to boost demand, and the market is underestimating pressure on casino operators’ profit margins, the German bank’s analysts noted this week. Melco’s adjusted property Ebitda was down 29 percent to $278.6 million. SJM’s annual gaming revenue dropped 8.8 percent to HK$79.3 billion, but CEO Ambrose So said it had been a challenging year, with a deterioration in the last half. So said that investors should not expect any sharp rebound in casino earnings in 2015, although is cautiously optimistic that revenue will stop falling in the second half of the year.     ****** MPE  

    SkyCity sees international growth, but clouds gather over Auckland project

    SkyCity Entertainment Group is optimistic about its prospects, but analyst reactions to its latest results have been lacklustre, while a major project designed to boost growth at home is facing difficulties. The company, which operates four casinos in New Zealand and two in Australia, is facing stagnant growth in its home market, while competition is set to mount in Australia. Overall in the 2013/2014 financial year New Zealanders spent $1.54 billion on the four main forms of gambling, an increase of less than one percent, while casino spending fell 2.1 percent. The company reported a flat profit of $66.6 million ($49 million) in its six monthly results on Wednesday, but also pointed to its increasing investment in Australia and its growing international business. SkyCity offered no full-year profit guidance, and its major capital investment project – an international convention centre in Auckland – is now in considerable doubt.