Inside Asian Gaming

INSIDE ASIAN GAMING | April 2013 14 IN FOCUS strong true underlying demand,” noted RBC Capital Management. Despite the hype surrounding what looks like the beginning of a return of VIP revenue growth, however, the mass market looks set to continue driving profits over the coming year. Nomura’s Harry Curtis wrote on 18th March: “We met with all but one of the concession holders. All are enjoying strong demand trends in 1Q but look forward to even greater EBITDA growth over the next 30 months as high-margin [mass] demand growth outpaces supply growth by 10-15 points.” Bird Flu Concerns The prices of Macau casino stocks fell near the beginning of April on worries that the H7N9 bird flu could impact visitor flows from mainland China to Macau. Though mindful of the risks, analysts believe the correction is overdone. Grant Govertsen pointed out: “At the moment all H7N9 cases are contained in the Yangtze River Delta provinces, which Overall share of Macau Gaming Revenue by Operator Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Sociedade de Jogos de Macau 28.0 27.4 26.8 27.6 27.0 Sands China 17.6 17.3 19.1 20.4 20.6 Galaxy Entertainment Group 18.8 21.2 19.4 18.2 18.7 Melco Crown Entertainment 13.4 12.6 13.2 13.5 13.3 Wynn Macau 12.2 11.8 12.1 10.7 11.3 MGM China Holdings 10.0 9.6 9.4 9.6 9.1 The most apparent trends since the beginning of last year are the steady increases in Sands China’s and Melco Crown’s shares of VIP rolling chip turnover, while capacity-constrained Wynn Macau has seen its share decline. Share of VIP Revenue by Operator Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Sociedade de Jogos de Macau 25.9 25.5 24.8 26.7 26.7 Galaxy Entertainment Group 20.4 23.4 21.0 19.3 19.9 Sands China 15.7 14.7 16.1 17.3 17.2 Melco Crown Entertainment 13.9 13.1 14.2 14.2 13.7 Wynn Macau 13.2 12.9 13.6 11.9 12.5 MGM China Holdings 10.9 10.4 10.2 10.5 9.9