Macau's gaming sector has shown a mixed financial performance in the third quarter of 2023, with property EBITDA margins slightly surpassing pre-COVID-19 levels but overall earnings still lagging behind. According to an analysis by Deutsche Bank Securities, the industry-wide EBITDA margin for Q3 2023 reached 29.3%, which is a small increase from the 29.0% seen in Q3 2019.
Despite this marginal rise in margins, the combined property EBITDA for the quarter fell approximately 20% from 2019 levels to just under $1.80 billion. Net revenue also saw a decline of 21%, while non-gaming tax-related operating expenses decreased by 9%. The mass-market gross gaming revenue (GGR) approached pre-pandemic figures, hitting 95% of Q3 2019's nearly $5.59 billion, amounting to $5.35 billion in the same period this year. This marks a staggering year-on-year surge of 760%.
The VIP segment, however, tells a different story, with VIP GGR plummeting by about 77% compared to Q3 2019, at $722 million. This contributed to an overall aggregate GGR for Q3 that was down by 31% on the third quarter of 2019, at just below $6.11 billion.
Among the six gaming operators in Macau, only SJM Holdings (OTC:SJMHF) acted as a donor last quarter, while Sands China (OTC:SCHYY) and Melco were donors specifically in the VIP segment. Meanwhile, Galaxy Entertainment Group (OTC:GXYEF), Melco, and SJM saw their market shares increase in VIP rolling chip volume.
In a positive turn for the industry, October brought a significant month-on-month rise in GGR of 30.6% to over MOP19.50 billion (US$2.42 billion), marking the best monthly performance since January 2020 when the pandemic began. This uptick has brought Macau’s GGR for the first ten months up to nearly MOP148.45 billion, reflecting a rise of 315.6% from the comparable period in 2022.
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