JPMorgan Changes Macau 2023 Earnings Estimates [games]
Famous investment bank JP Morgan's change to Macau game operators' expected earnings for the first quarter of 2023 will largely end border restrictions in Macau, Hong Kong and mainland China from Jan. 8, influenced by last week's news.
This would mean the resumption of ferry services between Hong Kong and Macau, which would benefit the economies of both markets.
Pass without restriction:
Inside Asian Gaming reports that all visitors from the mainland, Hong Kong and Taiwan will be able to cross the border without the long-awaited negative coronavirus test. There will also be no obligation to declare health status and no isolation requirements will be required for foreigners.
Passenger carriers Turbojet and Cotai Waterjet continued their flights between Macau and Hong Kong on the 23rd, and will continue to operate 10 round trips a day over the next few weeks.
"The road to normalization is now ahead of what we/markets expected," said DS Kim, an analyst at JPMorgan, calling the change "gradually positive."
He also mentioned earlier expectations that the popular market GGR would recover, saying it would be 35% higher than in the first quarter of 2019, and that the Chinese Spring Festival holiday period was somewhat conservative if Hong Kong players were to return.
Kim expects March GGR levels to increase by more than 35% on positive EBITDA in Q1 and positive free cash flows in Q3, and more than 50% for the June quarter.
"I wouldn't be surprised if we had a full recovery (mass/non-game GGR going back to 2019 levels) on our current model, 2H23, much earlier than the mid-2024 model," he added
The increase is big news for Macau, as it marks the first time since 2004 that it has fallen 51.4% in 2021, the lowest in a single year. The results for 2022 were not so good either. Recorded GGR was only $42.2 billion, or $5.3 billion.
Results already shown:
The latest results, just one day after opening the border, show that the prediction was correct: 5,630 visitors crossed the border between Hong Kong and Macau in just one day. The total number of visitors was 39,606, 153.5% higher than the average daily number.
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This would mean the resumption of ferry services between Hong Kong and Macau, which would benefit the economies of both markets.
Pass without restriction:
Inside Asian Gaming reports that all visitors from the mainland, Hong Kong and Taiwan will be able to cross the border without the long-awaited negative coronavirus test. There will also be no obligation to declare health status and no isolation requirements will be required for foreigners.
Passenger carriers Turbojet and Cotai Waterjet continued their flights between Macau and Hong Kong on the 23rd, and will continue to operate 10 round trips a day over the next few weeks.
"The road to normalization is now ahead of what we/markets expected," said DS Kim, an analyst at JPMorgan, calling the change "gradually positive."
He also mentioned earlier expectations that the popular market GGR would recover, saying it would be 35% higher than in the first quarter of 2019, and that the Chinese Spring Festival holiday period was somewhat conservative if Hong Kong players were to return.
Kim expects March GGR levels to increase by more than 35% on positive EBITDA in Q1 and positive free cash flows in Q3, and more than 50% for the June quarter.
"I wouldn't be surprised if we had a full recovery (mass/non-game GGR going back to 2019 levels) on our current model, 2H23, much earlier than the mid-2024 model," he added
The increase is big news for Macau, as it marks the first time since 2004 that it has fallen 51.4% in 2021, the lowest in a single year. The results for 2022 were not so good either. Recorded GGR was only $42.2 billion, or $5.3 billion.
Results already shown:
The latest results, just one day after opening the border, show that the prediction was correct: 5,630 visitors crossed the border between Hong Kong and Macau in just one day. The total number of visitors was 39,606, 153.5% higher than the average daily number.
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2023-09-18 11:21
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