MGM China and Melco Resorts are poised to exhibit the highest year-on-year GGR growth in the three months to 30 June 2019, driven by the ongoing ramp of MGM Cotai and Morpheus respectively.
The prediction is posed by brokerage Sanford C Bernstein in a note published early Tuesday morning ahead of the first 2Q19 earnings results being released later this week.
According to Vitaly Umansky, Eunice Lee and Kelsey Zhu, MGM China will likely show the highest year-on-year GGR growth, “driven by ramp up at Cotai, albeit slower than initially expected.”
Likewise Melco, “especially the Mass (Premium Mass) segment, should have benefited from the addition and ramp up of Morpheus Tower,” Bernstein said. Conversely, Galaxy will likely have suffered from softness in VIP, with Sands China to have faced a tough sequential comparison and SJM Holdings challenging year-on-year comps.
Macau’s DICJ revealed earlier this month that GGR for the three months to 30 June 2019 had fallen ever so slightly (0.5%) to MOP$149.50 billion. Bernstein analysts estimate that decline represented a 14% fall in VIP GGR, offset by a 12% increase in mass. EBITDA is estimated to have grown 6% year-on-year.
Early predictions are for modest 1% growth over the second half of 2019, albeit with some potential upside from a recovering credit cycle in China that may support VIP recovery, which the analysts say would have a more positive effect on their 2H GGR forecast.
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