2014-11-04

Macau Casino Revenue Plunges

Revenue at Macau casinos falls by a record 23 per cent in October
The mainland's crackdown on graft, protests in Hong Kong and a ban on smoking indoors combined last month to create a perfect storm for Macau's casino industry, with gross gaming revenue plunging 23.2 per cent year on year to 28.025 billion patacas.

It was the fifth straight monthly decline and the largest on record since the city started collecting data in 2005. But it was in line with analyst forecasts of a drop of around 22 per cent.

On Monday, Macau's secretary for economy and finance, Francis Tam Pak-yuen, warned that the decline would top the previous record set in January 2009, after the global financial crisis, when revenue fell 17.1 per cent. "Although it has already dropped for the fifth consecutive month, we still predict the slowdown of gaming revenue growth will continue for a period of time," Tam said.

These type of stories keep coming up and there's always an explanation for why it isn't the business cycle. Deeper in the story it says mass market (middle class) gamblers may have still increased, so that lends some credence to the argument that the smoking ban and anti-corruption campaign are responsible. Las Vegas doesn't have a smoking ban in casinos and high rollers insensitive to prices are likely make the trip to gamble in comfort.

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