02/05/09 06:59AM EST
Total Macau Baccarat revenue declined 19% YoY in January but increased 12% sequentially from December 2008 due to seasonality. The YoY decline was isolated in the Rolling Chip (RC) business which fell 26%. RC turnover also declined 26% so there were no hold issues there. Surprisingly, Mass Market (MM) revenue actually increased 5%.

The lack of credit available to RC players continues to drive Macau revenues lower. The junkets flooded the market with credit in the first half of 2009 making upcoming comparisons very difficult. The MM business has picked up some of the slack although visa restrictions have limited the impact. From a long term perspective, the relative strength of the MM is encouraging since a) visa restrictions could be loosened, and b) margins are considerably higher in MM than RC.

In terms of market share, MGM gained an impressive 400 bps of total market share sequentially and improved its share on both segments. Wynn Macau also performed well on a relative basis. It gained modest market share (200 bps) and put it back at the average levels experienced in 2008 after several months of declines. Finally, Galaxy used market leading junket commission rates to gain 300 bps of market share in RC. LVS was the clear loser in market share with Sands Macau and The Venetian losing approximately 400 and 300bps, respectively, of total share sequentially.

Net/net the month could’ve been worse. There is no remedy for the tough RC comps but any growth in MM is encouraging.

MGM, WYNN, and Galaxy improved
RC in rough shape
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