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Macau gambling revenue slump continues in March with 16.3% drop
[HONG KONG] A near two-year tumble in gambling revenue in China's Macau, the world's largest casino hub, continued in March with a 16.3 per cent fall as visits by big-spending high-rollers became even more infrequent.
The special administrative region on China's southern coast is dependent on gambling revenue. But revenue started to fall after the Beijing government began a campaign against conspicuous spending by public officials, while economic growth slowed on the mainland - home to the majority of customers.
Revenue has since hit five-year lows.
In March, gambling revenue fell from a year earlier for the 22nd consecutive month to 18 billion patacas (S$3.1 billion), government data showed on Friday. That was in line with the 13 per cent to 16 per cent decline estimated by 6 analysts, according to data from Thomson Reuters.
Analysts said volatility remains high in the VIP sector due to the government campaign as well as tighter regulations in Macau, the only Chinese territory where casino gambling is legal.
"We reiterate our view that gaming revenue in Macau is likely to decline 0-10 per cent in 2016, given policy headwinds and the structural shift to mass market customers from high rollers," said Standard & Poor's credit analyst Sophie Lin.
The gambling industry in the former Portuguese colony prior to 2015 was heavily reliant on high-roller VIP gamblers, who accounted for over two-thirds of total revenue. That portion has fallen to just over half.