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Macau’s gaming sector may have to brace for slow July growth, as China authorities intensify efforts in battling illegal money exchange.
As Macau news agencies reported, analysts from Morgan Stanley, Praveen K. Choudhary, Gareth Leung, and Stephen W. Grambling, have forecasted that the second quarter “is projected to report the first negative quarter-on-quarter growth in both industry mass gross gaming revenue(GGR) and corporate EBITDA since the post-Covid-19 reopening.”
They also predicted that “mass GGR is expected to decline 2% quarter-on-quarter, reaching 113% of 2019 levels,” while corporate EBITDA is expected to “decrease 7% quarter-on-quarter, reaching 80% of pre-pandemic levels.”
The slowdown resulting from the illegal money exchange crackdown, in addition to weaker macroeconomic conditions, consumption and retail sales in China might “persist into the third quarter and impact the Macau market,” the brokerage firm concluded.
It added that fourth-quarter results might also be negatively affected by the anticipated visit of China’s President Xi Jinping in celebrating the 25th anniversary of Macau’s handover to China.
Macau authorities are attempting to deal with crime on several fronts, from casino fraud to cross-border illegal gambling syndicates.
Nearly 300 people had been detained for investigation and seven charged during Macau’s latest anti-crime operation. Macau police have also busted an illegal mahjong operation around Av. Marginal do Lam Mau, arresting four suspects.
Despite the negative news, analysts are still positive that the combined EBITDA margins for the six biggest gaming concessionaires in Macau will remain strong June onwards.
