A Jefferies expert suggests that Macau’s gaming sector may not experience a complete financial rebound until 2023.
The COVID-19 outbreak severely impacted Macau’s casinos. The government’s stringent travel limitations and enforced business shutdowns resulted in a significant surge in unemployment, reaching levels unseen since 2009.
Statistics published earlier this month revealed a staggering 95% year-over-year plunge in gaming income for July, representing the most substantial single-month decrease since the pandemic’s onset. Total gaming revenue for July amounted to a meager 3.98 billion patacas (approximately $493 million), reflecting an 84% decline from the preceding month.
Analyst Andrew Lee proposes that visitor counts to Macau will stay low due to apprehensions regarding additional restrictions. He projects that the region won’t fully recuperate until 2023. This outlook is more downbeat than that of Ben Lee, a managing partner at IGamiX Management & Consulting, who anticipates a similarly bleak August succeeding July’s abysmal performance.
Although casinos resumed operations in July, they encounter stringent constraints, encompassing limitations on personnel and patrons. Travel between Macau and mainland China also persists as restricted, severely affecting the influx of tourists and gamblers.
The Macau gaming sector experienced a significant decline in the second quarter of 2022 due to stringent Covid limitations. MGM China saw its income nearly halved, plummeting by 46%, while Melco Resorts & Entertainment faced a similar fate with a 48% decrease. Studio City, a Melco affiliate, suffered the most, posting a $1.9 million deficit. With the ongoing pandemic continuing to impact their business and economic outlook, they are already cautioning stakeholders to anticipate a challenging third quarter.
