Macau VIP results down 35% in 19Q4: MS

Analysts at Morgan Stanley estimate Macau’s VIP revenues to have declined 35 percent year-on-year in 19Q4, while mass and slots grew around 6 percent in the same quarter. 

The analysts made the comments in a 19Q4 preview note, sent on Monday. 

Last quarter, Macau recorded 19Q4 GGR of MOP72.2 billion (US$9 billion), which was down 8 percent year-on-year, and up 2 percent quarter-on-quarter.

MS said this was weaker than normal seasonality, which hovers around 5 percent QoQ growth. 

Due in part to a weak December, the analysts now also forecast overall EBITDA to fall 2 percent year-on-year, worse than earlier expectations, which is “possibly driven by negative operating leverage, bad debt provision, and higher staff bonuses,” according to the analysts. 

That being said, capacity expansion and cheap valuation are set to drive outperformance in 2020, irrespective of GGR trends, said MS.