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Visitation from mainland China contributing to drop in overall visitation to Singapore.

Anyone predicting a 40% to 50% drop in total Mainland visitation?  How about eight straight months of YoY declines in Mainland visitors?  Uneasiness over the tragic Malaysian airline 370 disappearance filled with Chinese nationals on March 8 no doubt contributed to the steep decline.  The number of Mainland Chinese on Malaysia/Singapore tour destination groups is way down since the incident.  However, weakness in Mainland visitation had actually started before the incident.  Mainland Chinese had been the 2nd largest visitors to Singapore - Malaysians overtook them in May 2014.  Overall visitation has fallen for three straight months, despite growth from Indonesia which continues to account for the most visitors to Singapore.

Genting will report its earnings in the next few weeks and we will likely see weak VIP volumes consistent with LVS and Marina Bay Sands.  Market VIP volumes declined in both Q4 and Q1.  Genting mentioned on its 1Q 2014 conference call that they had not seen much impact from the Malaysia/Korea incidents. 

Not surprisingly, our regressions show that visitation is a statistically significantly variable in driving gaming revenue.