Inside Asian Gaming

inside asian gaming December 2014 42 China’s Lotteries Closing In on US China’s official Sports and Welfare lotteries broke the US$5 billion mark in sales in October, the latest figures from the Ministry of Finance show, and the two look set this year to surpass $61 billion. The $5.34 billion in sales for the month represent a combined 20.3% increase year on year, with the Sports Lottery leading the way at +27.9%, while the Welfare Lottery was up 14.5%. Sales through the first 10 months are up 24% over the same period in 2013, easily surpassing last year’s roughly 18% year-on-year increase, which resulted in $49 billion in total sales and solidified China’s status as the second-largest national lottery market in the world behind the United States. By comparison, global sales grew by 4.9% last year. US sales were up 3% last year on an unaudited basis to $64.9 billion, not counting $6.1 billion in revenue from video lottery terminals in eight states. Forecasts calling for China’s lotteries to reach $73.3 billion in 2015, should they prove accurate, will likely see the country overtake the US over the next 12 months to move into first place. Macau MICE, Visitation Defy Gaming Slump While Macau’s casino market hit its sixth straight month of year- on-year revenue declines in November, new data released by the government show a vibrant meetings and conventions market that has been gathering momentum over the course of 2014. MICE revenues (meetings, incentives, conferencing and exhibitions) almost doubled through the first nine months of the year, according to results compiled by the government’s Statistics and Census service. The city hosted 240 such events in the third quarter that drew more than 724,000 participants and attendees, a 16% increase over last year’s third quarter. For the year through September, 743 events were held, generating more than MOP125 million (US$15.6 million) in receipts, a 94% increase over the same period in 2013. The number of participants increased by 48% year on year to more than 1.5 million. Non-gambling spend in general has been on the upswing as well. Visitors to Macau spent MOP15.5 billion ($1.9 billion) in the third quarter, excluding gambling, an increase of 4.6% over the same period in 2013, official data show. Per capita spend fell by 1.4% year on year to MOP1,878 ($235), but the number of visitors grew by 6.1% to 8.2 million. Mainland Chinese were the biggest spenders over the period at MOP2,220 per head, with shopping accounting for 57% of their total expenditure. Overall, shopping accounted for 49% of spend market-wide, followed by accommodation at 26%. Total visitor arrivals to the city through the first nine months are up 7.4% to 23.5 million. ‘Gift’ From Beijing: Longer Hours at Border Crossings Macau’s sagging revenue growth should get a badly needed boost from a new agreement with China providing for extended operating hours at the main border crossings connecting the city to the mainland at Zhuhai and at Hengqin Island. Beginning 18th December, the main crossing at the Gongbei Border Gate between Macau and Zhuhai will be open two additional hours. Full 24-hour operations will commence at the Lotus Bridge crossing between Hengqin and the city’s Cotai resort district. Also, the connection at the Zhuhai-Macau Cross-Border Industrial Park will be open to all Macau residents. Currently, it’s only open for employees of the industrial park. Neighboring Guangdong province is home to the largest number of travelers from China to Macau, accounting for around 40% of total mainland visitation, and investment analysts are looking to the extended hours to help light a fire under a market that leads the world in casino revenue—US$45 billion in 2013— but is looking at flat to negative growth this year and possibly next, according to some analysts. REGIONAL BRIEFS The Gongbei Border Gate between Macau and Zhuhai “We believe [the extension of hours] could be positive in terms of the number of hours spent at gaming tables by same- day travelers, and thus potentially for casino operator revenues,” Barclays analysts wrote in a recent client note. “The changes to the Hengqin border would likely have a limited near-term impact, in our view, but could be positive in the long run as Hengqin’s development projects are completed and potentially attract more residents and visitors to the area,” they added.