Fitch expects a full recovery in Macau’s casino GGR by 2024
In the first eight months of 2021, the aggregate casino GGR (Gross Gaming Revenue) stood at nearly MOP 61.91 billion. This is a 70.1% increase from the previous year, which stood at MOP 36.39 billion. This increase in the GGR follows after the 68.8% decrease experienced in a similar period in 2019.
In a report released on Tuesday, Fitch Ratings Inc. stated that it expects Macau’s GGR this year to be 65% below what was recorded in 2019 before the COVID-19 pandemic. They also anticipate a full recovery of the GGR by 2024, with a 35% recovery by 2022.
Before the COVID-19 pandemic in 2019, the GGR in Macau was slightly above MOP 292.4 billion (USD 36.5 Billion). Fitch Rating Inc. estimates Macau’s GGR to be MOP 102.4 billion (approximately) this year. Their report predicts a recovery to nearly half the pre-COVID-19 levels in Macau's casino GGR.
However, the Macau government forecasts the GGR to be MOP 130 billion in 2021. This prediction is 44.5% below the pre-covid-19 levels in 2019. They also indicated that the recovery of the GGR would take time.
Fitch’s report focused on the U.S based casino operator Las Vegas Sands Corp, the parent company to Macau’s gaming operator Sands China Ltd and the Marina Bay Sands casino complex in Singapore.
According to its memo, it expects a slightly higher growth for Singapore due to its high vaccination rate, strong domestic demand, and opening up of borders without the need to quarantine for certain countries.
In Tuesday's report, Fitch confirmed Las Vegas Sands default rating at BBB, an investment grade, and gave it a negative outlook. This rating also spilled to Sands China and Marina Bay Sands Pte Ltd.
Despite the challenges caused by international travel restrictions, Fitch expects Las Vegas Sands to return below its 3.5 times net leverage sensitivity by 2022.