• It's Here!

    Etf Pro

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

  • It's Here


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

Takeaway: Mgmt believes the Macau govt have about 400 new tables to allocate to Cotai in 2015. Mgmt will also ask for additional tables this year.



  • Past months have been challenging in Macau 
  • Visitation in Fisherman's Wharf have increased 5% YoY from 4.1m in 2013 to 4.3m in 2014
  • Interested in South Korea, Japan and other Asian countries
  • Margins from Direct VIP are attractive
  • Not overbuilt and fully funded
  • Targeting mass segment 
  • Marina Ph2 (convention center/additional hotel/larger marina) -expected Q2 2016
  • Opening of Harbourview Hotel (Feb 2015) attended by both Macau officials and Central govt officials
  • Total hotel inventory is around 1,000
  • Legend Palace Hotel (Q2 2016) (Monte-Carlo theme): applied for construction license for superstructure. Expect approval very soon.
  • Expect govt approval to operate the marina by June 2015
  • Submit for application for MFW phase 2 redevelopment:
  • Non-gaming as a % of total revenues: 29%
  • Will reclassify some VIP tables into Mass
  • MLD has performed Peninsula on GGR


  • Only report 2% of outsourced VIP revenue as MLD revenue
  • Harborview construction took ~1 yr; right now, have 33 gaming tables in operation
  • Dinosaur experience: hope to start construction later in 2015
  • Performance theater: expect to open Q2 2017
  • Labor market continues to be tight in Macau. Have added pension scheme as part of retention policy

Q & A

  • Macau govt - they have about 400 new tables to allocate to Cotai in 2015.
  • IVS study: Chinese govt will not stop anybody from coming and will not hurt Macau. Want Macau to be more non-gaming and an international destination. 
  • Will you apply for new tables in 2015? Can move 10 tables from Landmark. Will ask govt for extra tables in 2015.  The 35 tables are not fully in operation since they are still training staff. They will be fully utilized by Q2 2015.
  • By Q2 2015, all 185 tables will be in operation. 
  • Q4 2014 vs Q4 2013:  didn't have any extraordinary items in Q4 2014. In Q3 2014, recognized $81.7m HK accrual from Legend contribution.
  • Casino mgmt system:  fixed rate contract Bally (biggest casino operations cost)
    • Additional costs from transition to new system and new staff from Bally; costs will come down in future quarters.
  • How much capital they have spent to date:  spent HK$1.3 billion for MFW redvelopment and Landmark renovation project.  Total budget: HK$8 billion.
  • Capex guidance: $2.5-$3.0 billion in 2015 and 2016