Macau bets on switch from gaming to GBA tourism hub

Macau's casino balance is ready for all people to accept this bet because the payment of dividends and the financing of new investment in the field of sightseeing and entertainment is being carried out simultaneously.

23 July 2024

The last Macau casino operator completed the fifth share of his own concession license in 2005. During this time, Macau's gambling total income (VGO) reached $ 6 billion, about half of those played on slot machines and cards in Nevada. However, as the Asian gambling hub developed, Macau rapidly led his South American counterparts, reaching $ 37 billion by 2019, reaching Nevada's characteristics.

Now, when the casino owner approaches Macau, they have resumed Las Vegas's personal views of what their own franchise is today, abandoned their gambling business, and entertainment. He believed that it was converted into a magnificent class A-buil t-in resort, and has repeatedly adapted to the sin in the big city. On the other hand, the characteristics of the arrival seem to be promising.

Nearly 9 million tourists arrived in Macau in the first quarter of 2024, up 79 % yea r-o n-year. The council plans to accept 33 million guests a year, but is actually slightly less than the nearby Hong Kong in 2023.

"Mary Mendosa of Financia, a gaming consultant company affiliated with the C3-gaming group in Las Vegas, said," It is important to develop this momentum. " It is important to make it. "

Mendosa has seen the support from tourist politicians Beijing to spend up to 7 days in the special administrative district (SAR) Macau and Hong Kong, which enables convenient complaints from the state to the mainland guests. It is an expansion of China's schedule (Fit), and it will actually help to support future development.

"Maca u-Among the unique families that are found to be a few minutes from most of the local capital of China," Mendoza is actually the 100th anniversary commemorative architecture, actually other cultural interesting places. As a ful l-fledged Portuguese dish, he stated that it would emphasize an unbearable interesting place as a Macau gastronomy scene and provide auxiliary reviews outside the casino.

Modernization and review of branches

Investment in non-gaming companies is distinguished by a set of superiority, explained Angela Kahn Lee, senior gaming analyst at Bloomberg Intelligence APAC, hotel business, discussed from FA earlier this year. According to his text, this is not only economic diversification, but also the disruption of cyclicality, in fact, preparing a more protected and forecasted branch, Kahn Li said at this point.

Macau casinos have already decided to achieve profits in non-gaming business, but the profitability of gambling business has frequently proven to be an obstacle to some important efforts. However, the criteria by which the authorities give value to the non-gaming industry, today's concessions on gambling are only 10 years, which is actually half of the previous 20-year concessions, so operators have to exchange orientations every day.

Attracted by the market potential and the connection with the 90 million spectators of the Great Bay Area (GBA) who want to stay in Macau, it was highlighted during the long-term licensing process in 2022, when seven candidates submitted orders for six licenses. As a result of this competition, all six active companies committed to put in as much as $15 billion for the current 10-year concession. The license was extended, and under this candidate, Genting Malaysia remained unlicensed.

Besides the tasks of COVID-19, these financial commitments coincided with a change in the customers of casino operators, who previously expected cool VIP players sponsored by junks that historically provided them with profits, and now switched to global buyers. The change of buyers does not pay attention to the fact that margins are built, as sponsors Dzhancet urgently demands commissions, the unearned GGR is less important, and as a result, the main size players of the global market are needed.

Investors reacted to this evolution. In 2014, Macau casino-promotion traded at an average EBITDA coefficient, when the GGR-size approached $45 billion, but then the section dropped to an average concrete figure, as the Chinese anti-corruption campaign and the slowdown in financial recovery had a negative impact. Promotions stabilized in 2018, with some evidence pointing out that global GGR surpassed the VIP category.

Given that popular gambling is currently contributing to GGR, it seems impossible to question the possibility of transferring to customers. Macau's total GGR from 2024 to April to April reached $ 10 billion, about 80 % before pandemic. The government predicts that the GGR will reach $ 27 billion in this year, but the decrease of EBITDA's 1 to 3 % reflects intensifying competitions due to casino entry. , The prediction was raised to $ 30 billion.

Dividend problem

Against the backdrop of the industry's change, casino shares paid dividends to attract investors and paid to save money during pandemics. Few analysts thought that payment would be resumed immediately, as the border was resumed and the players returned to the playground, and that the positive promise to refuse gambling was announced.

However, in February, each operator announced an unexpectedly announcing plan for funding to shareholders and surprised the market. The top was Galaxy, paid a special dividend of $ 0, 30 per share, MGM for $ 0, 24, and Win paid a special dividend of 0, 08 Hong Kong dollars. From the beginning of this year, investors have rewarded the generosity of casino macau's casino, and the sector indicators have caused the Hong Kong exchange, the Hong Kong exchanges, outperpointed.

Dividends are powerful incentives for investors. Jeffrey's strategist, Christopher Wood, wrote in a customer's memo, saying that money managers bet on stocks that maximize shareholders' profits through dividends and stock reductions. Wood pointed out that since the end of January 2023, the CSI300 dividend index has been overall of similar stocks without dividends.

The simultaneous investment and dividend payments reflect the positive mood in both the Macau and the casino industry. If the business cash flow does not increase properly, the stress of funding in the company balance will decrease, the liability level will increase, and the liquidity will be more likely to be affected by financial costs. < SPAN> Given that popular gambling is currently contributing to GGR, it seems impossible to question the possibility of transferring to customers. Macau's total GGR from 2024 to April to April reached $ 10 billion, about 80 % before pandemic. The government predicts that the GGR will reach $ 27 billion in this year, but the decrease of EBITDA's 1 to 3 % reflects intensifying competitions due to casino entry. , The prediction was raised to $ 30 billion.

Dividend problem

Against the backdrop of the industry's change, casino shares paid dividends to attract investors and paid to save money during pandemics. Few analysts thought that payment would be resumed immediately, as the border was resumed and the players returned to the playground, and that the positive promise to refuse gambling was announced.

However, in February, each operator announced an unexpectedly announcing plan for funding to shareholders and surprised the market. The top was Galaxy, paid a special dividend of $ 0, 30 per share, MGM for $ 0, 24, and Win paid a special dividend of 0, 08 Hong Kong dollars. From the beginning of this year, investors have rewarded the generosity of casino macau's casino, and the sector indicators have caused the Hong Kong exchange, the Hong Kong exchanges, outperpointed.

Dividends are powerful incentives for investors. Jeffrey's strategist, Christopher Wood, wrote in a customer's memo, saying that money managers bet on stocks that maximize shareholders' profits through dividends and stock reductions. Wood pointed out that since the end of January 2023, the CSI300 dividend index has been overall of similar stocks without dividends.

The simultaneous investment and dividend payments reflect the positive mood in both the Macau and the casino industry. If the business cash flow does not increase properly, the stress of funding in the company balance will decrease, the liability level will increase, and the liquidity will be more likely to be affected by financial costs. Given that popular gambling is currently contributing to GGR, it seems impossible to question the possibility of transferring to customers. Macau's total GGR from 2024 to April to April reached $ 10 billion, about 80 % before pandemic. The government predicts that the GGR will reach $ 27 billion in this year, but the decrease of EBITDA by 1 to 3 % reflects the intensification of competition due to casino entry. , The prediction was raised to $ 30 billion.

Dividend problem

Against the background of the industry change, casino stocks paid dividends to attract investors and paid to save money during pandemics. Few analysts thought that payment would be resumed immediately, as the border was resumed and the players returned to the playground, and that the positive promise to refuse gambling was announced.

However, in February, each operator announced an unexpectedly announcing plan for funding to shareholders and surprised the market. The top was Galaxy, paid a special dividend of $ 0, 30 per share, MGM for $ 0, 24, and Win paid a special dividend of 0, 08 Hong Kong dollars. From the beginning of this year, investors have rewarded the generosity of casino macau's casino, and the sector indicators have caused the Hong Kong exchange, the Hong Kong exchanges, outperpointed.

Dividends are powerful incentives for investors. Jeffrey's strategist, Christopher Wood, wrote in a customer's memo, saying that money managers bet on stocks that maximize shareholders' profits through dividends and stock reductions. Wood pointed out that since the end of January 2023, the CSI300 dividend index has been overall of similar stocks without dividends.

The simultaneous investment and dividend payments reflect the positive mood in both the Macau and the casino industry. If the business cash flow does not increase properly, the stress of financing in the company balance will decrease, the level of liability will rise, and the liquidity will be more likely to be affected by financial costs.

At present, the credit market is allocating several rests to reduce the expected interest rate reduction of business costs and serious costs. A few days later, Fitch Rating Agents worsened the monitoring of Chinese debt pledges, and then the institution became an upgrade of "positive rating or the soloblin rating of" sustainable diversification of the macau economy to the gambling industry ". He pointed out that it had the potential to be connected, and then approved the AA level with a "stable" monitoring of Macau.

Expanding the role of Macau

The diversification of the Macau economy is considered value not only for the Macau government but also for Beijing.

From the stage of the transfer of administration in 1999, Macau worked to give fresh information on the favorability of Chinese tourists with more movement and purchasing opportunities as a political laboratory. In fact, like Macau, these rowing not only supports Beijing's ambitions on the development of the domestic economy, but also create a work sample that has all the possibilities that spread throughout the GBA. Add customers.

Simpson takes a Crystal Palace in the UK, which is an exhibition hall in the mi d-19th century, which is characterized by the origin of consumerism, saying, "The wall is not made of glass, but Macau's Venetian Resort is my hometown. Crystal Palace, and its impressive gambling, cosmetics, and elaborate trade attractions can help Chinese tourists into (supporting the economy) consumer. "

In fact, Simpson added: "As a guest has entered the glass system (crystal palace), you can see, touch, and buy more than 14. 000 exhibitors gathered from all over the world. This is a resort of Macau.

I n-house innovation

The coordination of the buyer is specified in the future prospects of Macau, and by 2028, 60 % of Metropolis GDP will be responsible for no n-gaming.

The cost of gambling is actually assumed that it will actually give out the space for investment in the no n-gaming area, but these configurations are based on Macau and the origin of Fintech and artificial minds (II) and creators. Andrew Pearson, the founder and management director of the Intelligenture Limited consulting company, specializes in the thriller dead chip syndykate, has its own drama.

"Despite gambling and gaming are rooted in the depth of the times, modern gaming investments are not only slot machines and card tables, but also produced artificial intelligence, machine learning, and natural language used to increase operation efficiency. It is an innovative technology that uses processing, "said Pearson in an interview with FA.