Another big month in Macau.
We've got mulitple indpendent sources confirming that April was another blockbuster. Yesterday, MPEL management asserted that Macau gaming revenues would be up 70% in April. Our sources confirmed at least 60% growth and that 70% was possible. It seems unlikely that MPEL would throw around a 70% number with so much confidence unless they did their homework. We wouldn't bet against it.
We did hear that hold was quite good so volumes may not have been as strong. We won't know for sure until we get our proprietary numbers next week but volumes will still look very good on a year over year basis.
Here are some other tidbits we picked up:
- Lots 5 & 6 – given that the condition that they are in that they would be hard pushed to be completed by 2Q2011
- If the labor restrictions pass it will be a challenge to get Lots 5 & 6 up – since there just aren’t enough workers in Macau. Expectation that there will be announcement after May holidays on the topic
- Apparently MPEL & Harrah’s were having intense discussions but they are dead because the government won’t allow Harrah's to get licensed
- We've heard that there are some very high revenue share junket deals at CoD – Jack Lam’s tables at 55% rev share (like his deal at Grand Lisboa). CoD's VIP salon mix is currently 50.50 RC/revenue share, but should move more towards revenue share
- Golden Group also has a deal at 55% revenue share deal at Grand Lisboa
- Larger junkets prefer revenue share since it's usually more profitable but since its also more volatile, smaller guys like the RC programs
- North of 80-85% of volumes in VIP are revenue share – so commission caps really have no impact. Apparently one of the reasons that the government didn't put in place a cap of revenue share agreements was because it was viewed as difficult to enforce but more so because many officials have interests in some VIP rooms
- Thinks that Sheldon’s numbers for Singapore are quite a stretch according to the guys on the ground