MACAU: DECEMBER DETAIL BETTER THAN HEADLINE

Adjusting hold to normal for both periods, December GGR would’ve grown a whopping 26% (off of a tough 20% compare) rather than the nominal 18% growth disclosed last week.  Of course, Mass led the way with 35% growth vs “only” 12% VIP revenue growth.  However, Rolling Chip volume actually grew over 23%.  The better than advertised December gives us more comfort in our January projection of 22-28% YoY growth.

Here are some Market and Operator takeaways from December:

Macau Market

• Estimated VIP hold (adjusted for Direct VIP) was only 2.85% versus normal of 3.00% and 3.14% last year
• The December comp of +20% was the most difficult since April
• Even slot revenue participated, up 10% 

LVS

• December was an outstanding month for the best positioned operator
• LVS came within 60bps of share of overtaking SJM as top dog, driven in part to low hold
• VIP hold (adjusted for Direct VIP) was higher at 3.3% vs 3.2% last year and normal of 2.8%
• Mass share was slightly above trend but Rolling Chip share was well below trend due in part to the House playing lucky
• GGR grew 31% YoY, 2^nd only to Wynn
• Mass growth of 57% led the market

WYNN

• WYNN is a growth story again! As we’ve discussed, Wynn Macau has made a more aggressive marketing/promotional push the last few months.
• YoY growth led the market for the first time in years, despite lower than normal VIP hold
• Mass growth of 30% was the property’s 2^nd highest in 2 years
• Encouragingly, Wynn’s Rolling Chip growth led the market
• Mass and Rolling Chip share came in above recent trend

MPEL

• Share climbed above trend in December due to high hold – 50bps and 40bps above last year and normal, respectively
• Mass share was higher than trend while Rolling Chip continues to trend lower – possible losing share to LVS and Wynn
• GGR grew 25% YoY
• RC was up only 2%
• We think MPEL could be a market share loser in 2014

MGM

• Hold fell well below last year but was close to normal
• Mass revenue actually declined YoY – 1^st time in 4 years -  no doubt as a result of Wynn’s aggressive Mass push
• VIP volumes remain strong

GALAXY

• Mass growth of “only” 28% was the lowest in 4 years
• Rolling Chip volume growth remained strong
• Market share was the 2^nd lowest of 2013, due in part to low VIP hold 

SJM

• VIP hold fell below last year's and normal, resulting in below trend market share
• GGR grew only 8%, 2^nd slowest behind MGM
• On a YoY basis, SJM grew Mass 26% - the highest growth rate in nearly 2 years