• It's Here!

    Etf Pro

    Get the big financial market moves right, bullish or bearish with Hedgeye’s ETF Pro.

  • It's Here

    MARKET EDGES

    Identify global risks and opportunities with essential macro intel using Hedgeye’s Market Edges.

New record despite low hold

March was another record month for Macau with total gaming revenues increasing 48% off of a 42% comp.  Growth in March was achieved in spite of low market hold.  Assuming direct play of 8.7% or RC of $6.1BN, March hold was only 2.60% compared to a hold of 2.67% in March 2010 (assuming 7.0% direct play or $3.1BN).  If hold in both periods was 2.85%, March YoY GGR growth would have been up 50%.

Every property that we track appeared to have below normal hold, with the exception of Starworld and MGM.   The US operators lost share to their Asian competitors – specifically SJM and Galaxy.  MGM experienced its third best market share since opening and should have another good quarter although hold was much lower sequentially.  MPEL also had a standout month in March volume-wise but experienced some very bad luck in VIP and we think Mass. 

Y-o-Y Table Revenue Observations:

Total table revenues grew 48% YoY this month despite low hold in the month, with Mass growth of 31% and VIP growth of 54%.  Junket RC grew 55% in March.

LVS table revenues grew 17%

  • Sands was up 10%, driven by a 2% increase in VIP and a 23% increase in Mass
    • Despite an easy comp, hold continued to impact Sands for the second month in a row.  Junket RC chip grew 19%.  Hold, adjusted for 15% direct play (in-line with 4Q10), was about 2.2%, compared to 2.6% hold in March 2010, assuming a 10% direct play estimate (in-line with 4Q09)
  • Venetian was up 15%, driven by a 7% increase in Mass and 21% increase in VIP
    • Junket VIP RC increased 42%.  Assuming 19% direct play, in-line with 4Q10, we estimate that hold was 2.7%, compared to 2.5% hold in March 2010 (assuming 21% direct play).
  • Four Seasons was up 41% y-o-y driven by 34% VIP growth and 85% Mass growth
    • Junket VIP RC increased 30%. Assuming 50% direct play, hold was 2.5% compared to an estimated hold of 2.7% in March 2010 assuming direct play levels were in-line with 4Q09 at 43%.

Wynn table revenues were up 57%

  • Mass was up 59% and VIP increased 57%
  • Junket RC increased 45%
  • Assuming 11% of total VIP play was direct, we estimate that hold was 2.5% compared to 2.3% last year (assuming 10% direct play)

MPEL table revenues grew 58%, driven by Mass growth of 59% and VIP growth of 42%

  • Altira was up 45%, with Mass continuing its tear, up 71% while VIP grew 43%
    • VIP RC was up 25%
    • Hold comparisons were easy in March. We estimate that hold was 2.7% compared to 2.3% last year.
  • CoD table revenue was up 70%, driven by 38% growth in Mass and 82% growth in VIP
    • Junket VIP RC grew 122% - more than any other property in Macau.  However, bad luck heavily impacted results - despite easy comps.  March 2010 hold was 2.5% (assuming 15.2% direct play) vs. 1.9% this month, assuming 18.5% direct play (compared to 19% in 4Q2010)

SJM revs grew 46%

  • Mass was up 28% and VIP was up 55%
  • Junket RC was up 55%

Galaxy table revenue was up 46%, driven by 39% growth in Mass and VIP growth of 47%

  • Starworld table revenues grew 49%, driven by 26% growth in Mass and 51% growth in VIP
  • Junket RC grew 38% at Galaxy Group and 40% at Starworld
  • Galaxy was the only concessionaire in March to hold above theoretical levels. We estimate that Galaxy held at 3.14% this month.

MGM table revenue was up the most in March, growing 96%

  • Mass revenue growth was 40%, while VIP grew 115%
  • Junket rolling chip growth was only second to CoD’s at 121.7%
  • Assuming direct play levels of 15%, we estimate that hold was 2.8% this month – in line YoY 

Sequential Market Share (property specific details are for table share while company wide statistics are calculated on total GGR, including slots):

LVS was the biggest share loser in March with share dropping 2.4% to 15.6% from 18.1% in February

  • Sands' share decreased 80bps to 4.8% - an all-time low for the property
    • The decrease was driven by a 70bps decline in VIP market share to 3.7%, an all-time low for property.  RC share was 4.1%, up 10bps sequentially, but below the 2010 average of 4.5%.
  • Venetian’s share plunged 2.2% to 7.9% from 10.1% in March – hitting a record low for the property
    • Mass share decreased 80bps to 14.1% from 14.9% in February (an all-time low for the property)
    • VIP share decreased 2.7% to 6.0% - the second worst month for the property after Jan 2011
    • Junket RC increased 10bps to 5.8%, which compares to an average of 6.3% share in 2010
  • FS share increased 20bps to 2.5%
    • VIP share increased 20bps to 2.7%
    • Mass share increased 10bps to 1.8%      
    • Junket RC share increased 10bps to 1.5%

WYNN's share decreased 1.2% to 14.0% from 15.2% in February, driven by a combination of low VIP hold and some share loss in Junket RC

  • Mass market share increased 70bps to 11.9%, compared to an average of 10.1% in 2010
  • VIP market share decreased 1.6% to 14.3% sequentially, below with its 2010 average of 16.0%
  • Junket RC share decreased 90bps to 14.7%, below Wynn’s 2010 average of 15.2%

MPEL's market share decreased to 14.1% from 15.2% in January – beating out Wynn by 10bps for 3rd place

  • Altira’s share increased 10bps to 5.2%
  • CoD’s share decreased 1.3% sequentially to 8.7% - 80bps above Venetian’s table market share!
    • Mass market share decreased 2.2% to 8.1%, lower than February's all-time high of 10.3%
    • VIP market share decreased 1.0% to 8.9% while Junket RC share increased 1.6% sequentially to 10.4% (compared with 5.8% share for Venetian).

SJM was the largest share gainer this month with total GGR jumping to 33.8% up from 30.6% in February. This was SJM’s best share month since April 2010.

  • Mass market share increased 1.5% to 40.8% while VIP share increased 3.8% to 32.8% (SJM’s best share in 40 months)
  • Junket RC share increased to 34.2% from 33.6% in February

Galaxy was the other big share gainer in March – gaining back its February losses (-2.3%) to 11.4% share

  • Starworld's market share jumped 2.5% to 9.6%
  • Share gains were largely VIP driven

 MGM's share decreased 80bps to 11.0%, from 11.8% in February

  • Mass share decreased 30bps to 8.2%
  • VIP share decreased 1.2% to 11.5% from 12.7% in February
  • Junket RC decreased 2.0% to 10.1%, above the property’s 2010 average of 8.4%

Slot Revenue:

Slot revenue grew 42.5% YoY in March to $118MM, just $2MM below February’s record month

  • MGM slot revenues grew the most at 109% reaching $19MM – a record for the property
  • At 74% YoY, Galaxy had the second best growth – granted, on a very small base. March slot revenue reached $4MM.
  • SJM grew 61% to $19MM
  • Wynn’s slot revenue grew 46% YoY reaching $24MM – the second best month for the property following a record February
  • MPEL’s slot revenues grew 37% reaching $23MM – setting an all-time high for the company
  • LVS had the slowest slot growth at 10%, granted off of the highest base. Slot revenues were $30MM.

MACAU: MAGNIFICENT MARCH  - table

MACAU: MAGNIFICENT MARCH  - mass

MACAU: MAGNIFICENT MARCH  - rc