VIP gaming slump hits MGM China
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The continued downturn in Macau’s gaming sector has led to a sharp drop in revenues for MGM China.
Releasing its results for the first six months of 2016, the company revealed that its total revenues had slumped 22% year-on-year to HK$7.2 billion (US$928 million), while its pre-tax earnings fell 17% to US$2.0bn.
The figures included a major 35% drop in revenues from its VIP table games – traditionally a casino’s highest revenue-generating sector. In comparison, main floor table games were down just 5%.
Macau’s gaming slump has now experienced 26 consecutive months of declines, triggered by a Chinese government clampdown on corruption and money laundering.
But demand for travel to Macau remains strong; the hotel at MGM Macau achieved an average occupancy rate of 95% during the January-June 2016 period, while revenue per available room (revPAR) hit HK$2,159.
The company is also planning to launch a major new integrated resort in Macau, located on the Cotai Strip. And Grant Bowie, MGM China’s CEO, said he is confident of the long-term future of the market.
“Mass gaming and diversification are the key to the future development of Macau,” Bowie said. “We are ready to bring in more innovative and tailored offerings with MGM Cotai. We are confident that we can capture the growth opportunities of Macau.”
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