Macau Gaming Industry Shows Signs of Recovery with Strong May GGR Figures
LISTEN TO THIS ARTICLE:Macau's gaming industry is showing signs of recovery, as indicated by strong gross gaming revenue (GGR) figures in May. According to the monthly report by the Gaming Inspection and Coordination Bureau (DICJ), Macau's gaming industry continued its upward trend in May, although it still remains below pre-pandemic levels.
In May 2023, gambling operators in Macau recorded a GGR of MOP$ 15.57 billion ($1.92 billion). This marks a significant increase of 366% compared to MOP$ 3.34 billion ($413 million) in May 2022. The May GGR also showed a 5.73% increase from April, signaling a continued upward trajectory since February, although the rate of monthly growth has slowed.
For the first five months of 2023, the cumulative GGR reached MOP$ 64.93 billion ($8.02 billion). This reperesents a substantial 173% increase compared to the same period in the previous year (MOP$ 23.79 billion or $2.94 billion).
However, despite the positive trend, May's GGR was still 40% lower than the pre-pandemic level of MOP$ 25.95 billion ($3.21 billion) from May 2019. Cumulative figure remains 48.3% lower than the MOP$ 125.69 billion ($15.53 billion) registered before the industry began its descent.
The positive performance in May can be partly attributed to the "May Day" Golden Week holiday period, during which nearly half a million international visitors arrived, leading to an 85% hotel occupancy rate. This influx of visitors had a positive impact on the overall GGR figure for the month.
The lifting of travel restrictions played a crucial role in Macau's recovery. Since January 8, the Macau government removed quarantine requirements for inbound travelers from all nationalities, allowing visitations from mainland China to resume. Testing requirements for visitors from mainland China, Hong Kong, and Taiwan were also lifted.
These measures had an immediate effect, with an 82.5% increase in GGR recorded in January. This prompted optimism among investors and led investment banks, such as Morgan Stanley, to revise their 2023 GGR, and EBITDA estimates upward.
Macau's Chief Executive Ho Iat Seng expressed confidence in the gaming industry's recovery, stating that the SAR could easily achieve MOP$ 130 billion ($16 billion) in 2023 GGR. His optimism is shared by Bill Miller, President and CEO of the American Gaming Association (AGA), who highlighted Macau, the Philippines, and Singapore as examples of strong recovering markets in the region during the G2E Asia conference in Singapore.
Prospects for Further Growth
While Macau's gaming industry still has a way to go to reach its pre-pandemic levels, the positive momentum, fueled by the lifting of restrictions and increased visitations, suggests that the recovery is underway. With continued optimism and efforts to attract visitors, Macau's gaming sector is poised for further growth in the coming months.
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