Fitch expects pre-pandemic for Macau in 2024, Las Vegas in 2023

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July 8, 2021

Analysts at Fitch Ratings say that they are expecting Macau’s gaming industry, based upon its gross gaming revenue (GGR), to recover to pre-pandemic levels by 2024.

This is a slower recovery than the agency expects to see for Las Vegas, which it estimates at recovering by 2023.

However, the group does note that the estimate for “full recovery to 2019 levels” in the jurisdictions could be “conservative given current trends”.

However it also warns that there are ongoing concerns about the “potential for renewed pandemic restrictions amid slowing domestic vaccination penetration and uncertainty regarding viral variants”.

The ratings agency estimates a full return for the United States’ regional markets within 2022, which it notes have already “nearly fully recovered”, as well as stating that “strong gaming demand in Las Vegas, particularly slots, is offsetting persistent weakness from the international and convention segment”.

Macau’s gross gaming revenue during the first six months of the year was up 45 percent year-on-year, but down 67 percent when compared to the same period of 2019.

Macau also recorded its worst GGR figure of 2021 in June, at just MOP6.35 billion ($820 million).

But in Nevada, gaming revenues in May reached $1.23 billion, a 25 percent increase when compared to the same month of 2019.

Fitch analysts made the recovery predictions as part of a note on MGM Resorts, and its subsidiary MGM China, coming in the wake of the recent announcement of a $2.32 billion acquisition by MGM of the remaining stake in CityCenter, Las Vegas.

A deal which will then result in the sale of the CityCenter funds to The Blackstone Group for $3.89 billion, under which MGM will then lease back its Aria Resort and Casino and Vdara Hotel and Spa, located in the complex.

In the note, Fitch affirmed its rating of both MGM Resorts and MGM China at BB-, with a Negative Rating Outlook.

This also reflects the “risks and uncertainty the global gaming industry is facing from the coronavirus pandemic, particularly jurisdictions that rely on international visitation”.

The agency notes it could revise MGM’s outlook to Stable “when the gaming industry’s recovery trajectory has a greater degree of confidence”, in particular if there is a “continuation of positive trends through the fourth-quarter 2021”.

Two Crown Resorts directors ‘skeptical’ if Crown Melbourne boss fit for job

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AGBrief Editorial

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July 8, 2021

Two directors of Crown Resorts told a Victorian royal commission into the company that they were doubtful as to whether the boss of its Melbourne casino was fit for the job.

The directors, Jane Halton and Toni Korsanos, told the inquiry they were concerned over Xavier Walsh’s failure to tell them about Crown’s tax issue during meetings in March.

The tax underpayment reportedly amounts to as much as AU272 million, an amount the company’s new CEO has downplayed to some AU$8 million.

Both Halton and Korsanos told the inquiry that the possible withholding of the tax information draws into question Walsh’s aptitude for the role.

Sydney Morning Herald

The Age

GEG to work with social services organisations to promote responsible gaming

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AGBrief Editorial

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July 8, 2021

Galaxy Entertainment group, responsible gaming

Committed to fulfilling its corporate social responsibility, Galaxy Entertainment Group (GEG) works with different social services organizations on the active promotion of responsible gaming.

GEG and the Macao Gaming Industry Employees Home Integrated Services Centre (“MGIEH”) have joined hands-on organizing a series of activities to promote responsible gaming to GEG team members and the community. Among the many initiatives that have been launched, the “GEG Presents: Stay Rational When Having Fun” campaign aims to encourage GEG team members and the general public to remain prudent while enjoying the games and related entertainment that are accessible to them during the 2020 UEFA European Championship through both online and offline channels.

In addition, GEG also worked with the Youth Volunteers Association of Macao (AJVM) and the Macao Catholic Family Advisory Council (MCAF) on hosting a “Relaxation Workshop for Working Women” that introduced sources of stress and coping strategies to female team members, and taught them how to manage their emotions positively to improve their health and mental wellbeing.

Launched in the end of May, the “Stay Rational When Having Fun” campaign will run for nearly two months, aimed at encouraging the public to be rational when engaging in games and related entertainment during major sports events. The campaign consists of a variety of activities, including roadshows at GEG’s back-of-house which successfully helped more than 1,000 team members bust the myths of football betting while they played at the specially designed foosball table. Meanwhile, GEG has also supported MGIEH to help raise the wider community’s awareness of responsible gaming by distributing relevant pamphlets at various sports venues and community recreational areas in Macau; and by posting and sharing an easy-to-understand four-frame comic on its website and social media platforms. The comic tells the defeated story of a football fan who wrongly believed that he can calculate his probabilities of winnings. The comic aims at helping young people understand the risks and behaviors of gambling addiction, and its related prevention methods.

MGM and DSAL launch diverse professional workforce development series

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AGBrief Editorial

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July 8, 2021

In view of providing more targeted trainings for different types of professionals, MGM collaborated with the Macau Labour Affairs Bureau (DSAL) again to launch the “Professional Workforce Development Series” for its team members. Categorized into three divisions, namely “Occupational Quality Training”, “Professional Certification” and “Career Development Program”, these series will offer professional trainings for an estimate of over 7,000 MGM team members.

Through providing this series of training to its team members, MGM hopes to equip them to cope with challenges in their career path, so as to enhance the overall quality of local talent, supporting Macau’s development into the tourism education and training hub for the Greater Bay Area.

President & Chief Operating Officer of MGM, Hubert Wang, said, “MGM has been collaborating with DSAL in providing different kinds of trainings for team members, enabling them to strengthen their occupational skills and qualities. This year, the trainings extend to more areas of professions, which is expected to help elevating the Company’s overall soft power by nurturing more team members. As we truly believe that talent development is the key to maintain the competitive edge and the sustainability of Macau’s tourism industry, we look forward to continue joining hands with DSAL and other sectors in the community to promote local talent development in more innovative and diverse ways.

Sands china extends waiver agreement for loan until 2023

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AGBrief Editorial

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July 8, 2021

Sands China has entered into a further waiver extension and amendment request linked to its 2018 SCL Credit Facility. The agreement extends the company’s current agreement with lenders from January 1st, 2022, to January 1st, 2023, as well as the period in which Sands China may supply the agent with its audited consolidated financial statements for the financial year.

It also extends the dividend restriction period until January 1st, 2023. The extension relates to a facility agreement with arrangers and lenders totaling some $2 billion in credit facilities.

Stock exchange filing

888 sees revenue growth of 10 percent in Q2, 2021

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AGBrief Editorial

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July 8, 2021

888, one of the world’s leading online betting and gaming companies, has announced a post-close trading update for the three months ended June 30th, 2021.

Revenue growth of 10 percent was driven by the continued success of the Group’s product-leadership strategy, long-term positive customer acquisition trends, and continued expansion in regulated markets.

Growth was also driven by regulated and taxed markets, which contributed 74 percent of revenue with strong performances in the UK, Italy, Spain, Romania, and Portugal offset by the impact of the new regulation in Germany.

B2C revenue increased 11 percent, led by Casino and Sport, with Sport growth boosted by a reduced number of sporting events in the prior-year period.

Poker and Bingo revenues were lower than the prior year, reflecting exceptionally strong performance during the prior-year period.

The strategic partnership with Sports Illustrated to provide 888 with a platform for strong U.S. growth.

The German regulator awarded a sports-betting license to 888, reinforcing 888’s position as one of the most-licensed global online betting and gaming companies. These were accompanied by continued strong cash generation and a robust balance sheet.

Japan to announce fourth state of emergency, rustlings in Nagasaki

By

Michael Penn

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July 8, 2021

Japan to announce fourth state of emergency

Japanese Prime Minister Yoshihide Suga is poised to announce the nation’s fourth Covid state of emergency, just two weeks before the delayed Tokyo 2020 Olympics are set to begin.

As with the previous state of emergency, this one will include a ban on restaurants and bars in the affected prefectures from serving alcohol to their patrons, as well as mandates to shut all businesses in the early evening.

New case numbers have begun to rise in Japan with the arrival of the more infectious Delta Variant of the coronavirus.

For the gaming industry in Japan, the biggest impact is expected to fall on the pachinko industry and the various forms of racing. Broadly, it also further encourages the shift toward digital forms of entertainment, including online betting.

The prime minister is expected to announce that the new state of emergency will run for the entire period of the Olympics through to August 22.

Coincidentally, that is also the date of the crucial Yokohama mayoral elections, and there have been two fresh developments in that race.

First, it has been clarified that incumbent Mayor Fumiko Hayashi intends to announce her candidacy on July 15, but after a series of events in which members of the local business community will publicly appeal for her to run in order to save the IR development project.

Second, a ninth candidate has appeared, the well-known former prosecutor Nobuo Gohara. He has outlined some rather odd proposals, however. First, he has declared that he opposes IR development, but would hold a public referendum on the matter to make the final decision. Second, even as he announced his candidacy, he stated that anti-casino forces need to consolidate their forces, suggesting that he might later withdraw from the race, depending on discussions with candidate Takeharu Yamanaka, the university professor backed by the main opposition Constitutional Democratic Party of Japan.

Down south, pro-IR forces in Nagasaki remain active.

The Kyushu-Nagasaki International Tourism Human Resource Development Consortium (Preparatory Committee) will be holding its second seminar on July 31 for local stakeholders in the tourism, hospitality, and education sectors. The seminar will be held online and will be in Japanese.

There are also new organizations being created.

The Kyushu-Nagasaki IR Safety and Security Network Council (Preparatory Committee) held their first official meeting on June 30, discussing addiction measures and public safety in regards to the prospective IR. The council members include representatives from Nagasaki University Hospital, PTA groups, local districts, and the Nagasaki Prefectural Police.

The Kyushu Regional Addiction Countermeasure Network Council is planned to be established this summer.

Finally, it has been noted that Yutaka Aso, brother of Deputy Prime Minister Taro Aso, has stepped down as chairman of Kyushu IR Council and has now been given the post of special adviser. This is related to the fact that last month Aso completed his term chairman of Kyushu Economic Federation, one of the major constituent organizations supporting the council.

The new chairman of both organizations is Sumio Kuratomi, who also serves as chairman of the Nishi-Nippon Railroad Company.

International Betting Integrity Association

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AGBrief Editorial

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July 7, 2021

IBIA, International Betting Integrity Association

The International Betting Integrity Association is the leading global voice on integrity for the licensed betting industry. Our Monitoring & Alert Platform is a highly effective anti-corruption tool designed to detect and report suspicious betting activity using detailed consumer data.

Your Daily Asia Gaming eBrief: Regulated betting needed to elevate Asian football

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AGBrief Editorial

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July 7, 2021

Good morning.

Greater Sydney is set to extend its stay-at-home lockdown by another week, amidst a continuing high number of covid-19 community cases by Australian standards. It’s expected to impact revenue of one of the world’s largest slot markets.
Meanwhile, the Royal Commission is said to have turned emotional after Crown’s new CEO took the stand, answering for the underpayment of tax that the company owed the government.
In Japan, incumbent Yokohama mayor Fumiko Hayashi has finally decided to enter the race on a pro-IR platform, reviving the prospect of an IR in the city.
Finally, our deep dive today looks to understand the gap between Asian and European football, as well as some rising sports in Asia that they should look to take a page out of.

First, the news

Regulated betting the final piece needed to elevate Asian football
Hayashi may enter Yokohama mayoral race, reviving IR prospects
Crown CEO: Only $8m owed in gaming taxes vs $272m claimed
Sydney lockdown expected to extend another week
Macau / HK border opening dependent on China
Macau reaches benchmark of 250k people vaccinated
Hong Kong to eye Singapore’s “return to normal” closely
Malaysian police bust RM2.8m gambling syndicate
Horse racing in India to have online-only audience in July
Caesars Palace undergoing multimillion-dollar renovation
Central Bank issues warning to companies dealing with crypto
Goa CM: No intention of allowing casinos to reopen during curfew

What you need to know

Sydney lockdown expected to extend another week

Australian health authorities have urged for the extension of Greater Sydney’s stay-at-home orders, after recording another 18 new cases of Covid-19 in the community on Tuesday. With daily infections hovering around 30 cases per day, NSW Premier Gladys Berejiklian is said to have “no choice” but to extend the lockdown. Casinos and club venues are closed. The latest developments have also prompted organizers of the “Regulating the Game” conference to postpone the event by several months.

Your Daily Asia Gaming eBrief: Regulated betting needed to elevate Asian football

Crown CEO: only $8m owed in gaming taxes vs $272m claimed

A week of turning-point testimony by top Crown Resorts officials to a Victorian gaming commission turned emotional on Tuesday as the company’s new CEO took the stand. Steve McCann, who joined the company in June, admitted that the company had likely underpaid the tax it owed the government. However, the CEO suggested the amount due was closer to AU$8 million, as compared to the AU$272 million the company allegedly avoided paying by handing it out through its pokies loyalty program.

Hayashi may enter Yokohama mayoral race, reviving IR prospects

Incumbent Yokohama Mayor Fumiko Hayashi has, according to the Mainichi Shinbun, decided to enter the race on a pro-IR policy platform, as her chances of victory are rising due to the clutter of anti-casino candidates that she would face. IR development is the biggest issue in the Yokohama mayoral race, and most voters are nearly certain to cast their votes for someone who opposes the project.

Insights

DEEP DIVE

Regulated betting the final piece needed to elevate Asian football

This year’s UEFA Euro 2020 has once again proven the power that European football has in drawing global eyes. In 2016, the football festival saw more than 2 billion people watching live on television and around 600 million for the finals alone. Amongst all the publicity surrounding Euro 2020, one question must be asked: Where are all the significant Asian football tournaments? The AFC Asian Cup, one of the oldest continental football tournaments in the world, is the largest tournament in Asia, but still pales in comparison to the major tournaments seen in Europe. In 2019, the tournament drew around 837 million fans, already a record achievement at the time.

Corporate Spotlight

Pragmatic Play Asia footprint set to expand

The well-known content provider in the iGaming industry— Pragmatic Play will continue to expand its footprint in emerging markets worldwide. The increasing acceptance of iGaming has resulted in a gradual shift in attitude toward regulation, with more and more markets taking an approach to deliver legislative roadmaps that will drive business in a period of hyper-growth.

Industry Updates

Regulating the Game organizers postpone conference
Rich Goldman appoints executive director
Operator-sponsored Art Macao to be held July-Oct
Marina Bay Sands launches virtual reality art gallery
Microgaming planning a series of new releases for July
Pragmatic Play takes live casino offering live with BetPlay

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Regulating the Game organizers postpone conference

By

Felix Ng

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July 7, 2021

Regulating the Game, the five-day gambling regulatory education program which was set to run in August will be postponing the event to later in the year amidst a rise in covid-19 cases in Greater Sydney.

“While we believed the prospect of a lockdown in Sydney was remote this far into the pandemic we were mistaken,” said organizers in an email note on Tuesday.

“Our challenge amid the sudden lockdown, border closures and associated restrictions, is ensuring that the program will be allowed to proceed, and that regulators and industry travelling interstate will be able to attend. Given the ongoing lockdown in Greater Sydney we believe it is best to delay the program a few months.”

“We are liaising with key stakeholders to secure alternative dates and look forward to making an announcement shortly.”