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Macau gambling revenues falls 21.4%

Macau gambling revenues falls 21.4%

MACAU: Gambling revenues for Macau dropped 21.4 percent in January, ahead of a Lunar New Year week-long holiday which is expected to boost the number of visitors to the world’s largest casino hub.

Revenue in the city fell for the 20th consecutive month to 18.7 billion patacas (US$2.33 billion), government data showed yesterday, in line with analysts’ hopes of an 18-26 percent drop.

Macau, which relies on the casinos for revenue, has been battered by a two-year-old anti-corruption campaign and slowing growth in China’s broader economy.

Gambling revenues are hovering around five-year lows but there are signs the worst may be over.

Casinos operated by Las Vegas magnates Steve Wynn and Las Vegas Sands Corporation’s Sheldon Adelson saw stronger-than-expected fourth quarter revenues, largely due to an increase in the middle class, so-called mass market gamblers.

Appealing to these gamblers has become a priority for casinos that once relied on the wealthier VIP gamers for most of their revenues — a category that has been the hardest hit by the crackdown on corruption and illicit money flows out of China’s mainland.

New casino resorts set to open this year will include features such as a miniature Eiffel Tower and large lake fronted with a gondola ride to draw in China’s rising middle class.

Yesterday, Chinese gamblers milled around the huge gaming room of the Sands China Venetian casino while families shopped and ate at the resorts’ multiple restaurants and boutiques.

Analysts and executives expect the Lunar New Year holiday, which starts on Sunday, to further boost the number of mass market gamblers to Macau from the mainland, which accounts for up to two-thirds of overall visitors.

Billy Ng, a Bank of America Merrill Lynch analyst, forecast total revenue growth to be flat this year, compared to 2015 when revenues fell 34 percent on the year.