MACAU (Reuters) - Gambling revenue in Macau fell 3.6 percent in July on an annual basis, the second monthly decline since 2009, due to the lingering impact from the soccer World Cup that diverted massive bets away from the world’s largest casino hub.
Gambling revenue from Macau’s 35 casinos fell to 28.4 billion patacas ($3.56 billion) in July from 29.5 billion patacas a year earlier according to data released by the Macau government on Friday. Analysts were expecting a drop of between 2-5 percent.
The southern Chinese territory of Macau, a special administrative region like neighboring Hong Kong, is the only place in the country where casino gambling is legal.
Chinese gamblers shifted to betting on the football competition in Brazil that ended on July 13. An intensifying corruption campaign spearheaded by Beijing coupled with weakening house prices and credit growth also dampened demand from high-roller VIP customers who bet millions of yuan at one time.
While July’s casino gambling revenue decline was the second consecutive drop for the former Portuguese colony in over five years, analysts expect growth to pick up in August.
Robust spending from large swathes of mass-market Chinese visitors is expected to offset lackluster appetite from high-roller VIPs who are typically brought in by junket companies or middle men who take hefty commissions from casino operators.
Over the past three months, global investors have shifted out of Macau-related stocks after a raft of regulatory curbs ignited concerns about slowing revenue growth.
Hong Kong-listed casino and gaming stocks have dropped 9-20 percent in the year to Aug. 1, underperforming the benchmark Hang Seng Index, which has risen 5 percent in the period.
Analysts say Macau’s fundamentals remain strong due to demand from mainland China where they estimate only around 3 percent of the population has traveled to Macau.
Monthly gambling revenues on average rake in two-thirds of what Las Vegas makes annually and are predicted to grow sizably as eight new resorts open over the next three years and improving infrastructure developments help shorten the travel time it takes to Macau.
($1 = 7.9860 Macau patacas)
Reporting by Farah Master; Editing by Matt Driskill