Casino Revenue in Macau Continues to Fall

matt makowski
Written by Matt Makowski
Published on Tuesday 2nd February 2016, 10:36 am
Posted in: Casino Business

Casino Business

January proved to be another tough month for Macau casinos as the region’s gambling revenue fell by a sizeable 21.4 percent, resulting in a loss of 5 billion patacas (£434,261,871) based on figures from the same time last year.  The industry suffered its twentieth straight month of financial decline, which piles the pressure on some of the major players in the world of gambling, including Australian billionaire businessman James Packer.

Traditionally, January tends to be one of the weaker months for gambling in Macau, with a rise in revenue emerging in early February as Chinese players visit the area to celebrate Lunar New Year. This slump is not a new issue, however, following a nosedive of 49 percent last February as a crackdown on corruption by the Chinese government seems to have scared off many high rollers from the mainland. In addition, gross gambling revenue in the region plummeted by 34 percent overall in 2015, the second straight year such a decline has been witnessed.

Macau isn’t the only area suffering from a rapid decline in casino revenue. Recently, Atlantic City has found itself floundering financially as gamblers travelled elsewhere, causing the city’s debts to start spiralling out of control as income dried up.

To combat the decline, Melco Crown, a major force in the Macau casino industry and part owned by casino connoisseur Packer, will intensify their focus on the mass market. The company’s Hollywood-themed Studio City casino, which opened in October 2015, will aim to attract a more mainstream crowd that does not feature any VIP facilities to attract big spenders from the mainland. The move could prove to be shrewd following reports that Macau’s first VIP slots room continues to struggle having been open for less than a month.

It is predicted that casino revenue in Macau will continue on a downward trajectory, but improved transport links and the development of additional large-scale resorts in the next few years may eventually provide the boost that the former Portuguese colony desperately needs.

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