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Macau signals rebound as gambling revenues hit 2-year high in Feb
[HONG KONG] Gambling revenue in the Chinese territory of Macau hit a two-year high in February, recovering steadily from a prolonged anti-corruption drive and slowing economic growth that dragged on the world's biggest casino hub over the past three years.
Analysts have already called a bottom to Macau's gaming industry slump with revenues rising over the past seven months.
New casino resorts have helped drive business by attracting mass gamblers as well as VIP spenders - who have stayed away since Chinese President Xi Jinping rolled out his campaign in 2014 against shows of wealth by public officials.
In February, Macau raked in a revenue of 23 billion patacas (S$4 billion), up almost 18 per cent from 19.5 billion patacas a year ago and the highest since January 2015, government data showed on Wednesday.
Results were also buoyed by a higher number of visitors over the national new year holiday at the start of the month.
Overnight Chinese visitation has grown since the start of 2017, following the opening of multi-billion dollar casino resorts in the third quarter of 2016 by Sands China Ltd and Wynn Macau Ltd.
Casino operator Galaxy Entertainment said that for the first time in a decade, overnight visitors to Macau this year had exceeded same-day visitor arrivals thanks to new hotel capacity. It reported a better-than-expected 51 per cent rise in 2016 net profit on Tuesday and forecast double-digit gaming growth for this year.
Macau's large junket operators have reported improving revenues since the second half of 2016.
These firms, which act on behalf of casino operators like MGM China to bring in high-rollers, had been slammed by the corruption crackdown but broad consolidation has helped strengthen their positions.
However, casino executives are betting more on the durability the mass market segment due to the steady growth of leisure visitors and the government's aim to shift away from casinos towards more family friendly activities.
Macau - a former Portuguese colony and now a special administrative region belonging to China - is the only place in the country where citizens are legally allowed to gamble.
The casino hub is set to see more new resorts - owned by the 13 Holdings and MGM - come online this year, followed by SJM Holdings' casino in 2018. These come at a time when Macau is facing mounting competition from emerging Asian casino hubs, including Japan that legalised casinos in December.