After a record August where gaming revenues recorded an all time high of MOP11.2bn, analyst are already starting to speculation that September will bring a 40% y-o-y increase revenues given the easy comparison since September 2008 was when the visa restrictions kicked in. However, DM does note that the past week saw a dramatic drop-off in business at the ferry terminals as the summer holidays came to an end and school season began. The Gongbei border crossing, however, remained busy and started to see an increase in traffic after lunch today as visitors began arriving for the weekend.



DM speculates on the use of proceeds of the $600MM pre-IPO bonds LVS just issued. DM wonders why LVS just didn’t wait a few more months for the IPO proceeds and what it will do with the $600MM in the meantime.  Restarting construction on sites 5 & 6 seems like a good possibility.


DM calls into question The Hong Kong Economic Journal’s claims that Wynn Macau will launch an IPO on September 25 and be traded on the HK stock exchange by October 8 as well as the $1BN size of the offering.  DM believes that given the timing a roadshow requires that an IPO in November is more likely, however, that WYNN will come before LVS is a certainty.

Wynn’s IPO application will be reviewed on Sept 10th and depending on the outcome a prospectus should come shortly thereafter.  While not questioning the desire to decouple the Macau from the sluggish fundamentals clouding Las Vegas, DM does raise the question of what the IPO proceeds will be used for.  Wynn doesn’t have any covenant issues, the Wynn Cotai project still seems a long way off, and its not really Steve’s style to buy other people’s projects, so perhaps Steve has another project in mind.



Macau Daily Post quoted the Portuguese-language Journal Tribune as saying that Wynn Macau leads the Venetian as the city’s single biggest revenue generator and provides a Top 10 ranking for the first seven months of the year, in MOP:

1. Wynn Macau – 9.64 billion on 380 tables, 1,166 slots
2. Venetian Macao – 8.88 billion (no kidding) on 585 tables, 2,478 slots
3. Lisboa Casino (old one) – 5.6 billion on 203 tables, 384 slots
4. MGM Grand Macau – 5.48 billion on 404 tables, 887 slots
5. Altira – 5.19 billion on 252 tables, 111 slots
6. Sands Macao – 5.14 billion on 414 tables, 1,406 slots
7. Grand Lisboa (new) – 4.83 billion on 289 tables, 723 slots
8. StarWorld – 4.65 billion on 243 tables, 283 slots
9. Jimei (former Oriental) – 1.3 billion
10. City of Dreams (opened June 1) – 1.21 billion



It looks like Turbojet is making a comeback after Venetian’s CotaiJet took a bite out of their business. Despite the ticket prices for TurboJet going at a significant premium to CotaiJet at the Hong Kong ferry terminal, however more traffic is still coming through the peninsula ferry terminal than the temporary ferry terminal at Pac On, on Taipa. 

Despite the more comfortable ferries that CotaiJet offers and superior customer service, the walk from the temporary Pac On to the dock at the immigration hall is still one mile, which is no fun in the summer heat.  Docking at Taipa can also add another 10 minutes which passengers in a rush may find annoying despite elimination of the need to take bus from the peninsula to get to Cotai. 

Unfortunately for the Cotai properties, it doesn’t look like the permanent Pac On terminal will be ready anytime soon. DM is hopeful that the permanent opening will follow closely behind the opening of Sites 5 & 6 and Galaxy Cotai in 2011, otherwise they fear that the Macau infrastructure will see a transportation strain.



It appears that Galaxy’s Cotai project is back on the front-burner again and the opening date can be as soon as end of 2010 or early 2011 at the latest.  The increase visitation and apparent easing of visa restrictions is a driver of the timing acceleration.



Viva airline announced this week that it is doubling its capacity to and from Narita international airport to four flights a week, which should increase the number of Japanese visitors coming to Macau since the direct flight will take half the amount of time as coming from Hong Kong when factoring the ferry trip. Japan was the only source market in East Asia to grow visitation y-o-y in the 1H09.

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