Lawrence Ho expects 2019 to be a ‘down year’

Melco Resorts & Entertainment chief executive Lawrence Ho said he expects the US-China trade war and renminbi devaluation to cause a ‘down year’ for Macau’s operators. 

He made the comments in an interview with CNBC over the weekend. 

“With the US-China trade war, with the renminbi devaluation it’s certainly having an impact on visitation into Macau, and more predominantly how much people spend,” he said. 

“On the top line, things will be slow and we’re going to have a down year for sure. But for most operators, especially for Melco, our bottom line has been strong.”

Melco reported close to 40 percent growth in EBITDA in 19Q3, benefiting from the opening and ramp-up of Morpheus and City of Dreams in 2018. 

When asked whether the civil unrest in Hong Kong has had an impact on visitation to Macau, Ho said that they have actually seen an uptick in visitation on weekends. 

“If anything we’re seeing a bit more weekend traffic from people in Hong Kong,” he said. “ The impact in Macau is more as a result of the Chinese economy and the US-China trade war.”

Ho notes that while visitation remains high, due mainly to the opening of the Hong Kong Macau Zhuhai bridge last year, spending per visit, especially on the higher end, has fallen. 

Looking to the year ahead, Ho said he hopes the phase one resolution to the US-China trade war to give confidence to the traveling consumer, which will be of benefit to Macau.