Saturday’s seemingly unprecedented blanket closure of Macau casinos due to a “super typhoon” called Typhoon Mangkhut, as well as associated disruption to public transport, probably shaved at least 500 basis points off the annual growth rate of September’s gross gaming revenue (GGR).
So said a note issued on Sunday evening by analyst Grant Govertsen, of brokerage Union Gaming Securities Asia Ltd.
“Given that the blanket casino closure happened on an all-important weekend day, which typically generates significantly higher GGR than a weekday, we expect that somewhere between MOP1.1 billion [US$136.2 million] and MOP1.5 billion in GGR will be lost,” wrote Macau-based Mr Govertsen.
Referring to the fact that the whole of what should have been Sunday casino operations was lost to Typhoon Mangkhut, the analyst stated: “We estimate this could impair September’s GGR growth rate by 500 to 700 basis points.”
When this story went online, the timing for resumption of gaming operations had not been announced.
Union Gaming said that following the major typhoon it was lowering its September GGR growth forecast to somewhere in the range of 7.7 percent to 9.3 percent, from 14.7 percent previously.
Deutsche Bank Securities Inc shaved a whopping 11 percentage points off its September GGR growth estimate in a Sunday note, bringing it down to 3 percent year-on-year from 14 percent.
“Given the loss of Saturday night/Sunday and what are likely to be disruptions over the course of the next several days, depending on damage and ease of travel in the coming days… Accordingly, our September GGR forecast has been reduced to +3 percent from +14 percent,” wrote analysts Carlo Santarelli and Danny Valoy.
Deutsche Bank also gave some colour on what it understood were the the circumstances of Saturday night’s blanket closure of Macau casinos.
Messrs Santarelli and Valoy stated: “We understand that the concessionaires were notified by the DICJ [Macau's gaming regulator] only shortly before the 11pm closure. We believe the limited notification window is important, as it likely means those who came by ferry were unable to leave by boat, while the window to leave before the 1am border gate closings was also limited. Accordingly, we believe the hotels remained largely full Saturday night through Sunday, though gaming areas were not functional.”
Union Gaming’s Mr Govertsen noted that taking the third quarter as a whole, Typhoon Mangkhut was “likely to have up to a 200 bps impact on the growth rate, and we now estimate 12 percent growth instead of 14 percent”.
The analyst further stated, referring to another huge storm called Typhoon Hato in August 2017: “For the second time in just over one year, Macau has taken a virtually direct hit from a super/severe typhoon. Fortunately, it appears that the city has come out the other side in much better shape after Mangkhut relative to last year’s Hato.”
The Macau government said in a Sunday evening press release that 20,000 households were without power at that stage, due to flooded power transformer stations in some low-lying areas.
Macau’s Chief Executive, Fernando Chui Sai On, urged officials at a meeting on Sunday afternoon of the city’s Civil Protection Operations Centre to ensure the local electricity utility restored power supply as quickly as possible.
In August, the government said work had been stepped up to strengthen the stability of the power supply during adverse weather, including attempts to flood proof certain parts of the electricity grid infrastructure.
0 comments:
Post a Comment