Macau Casinos Thriving As Junket Changes Loom

Macau casinos

Macau casinos saw stellar earnings of $844 million in November with fear looming as to how operations will fair by next year when junkets are removed.

The November revenue totals for Macau are in, with casinos generating MOP6.75 billion ($844 million) from gamblers last month. This was a small .01% from the same month last year but over 50% better than October. The venues actually enjoyed their best month since July, and it was certainly welcomed by operators. Even though earnings were better, the gross gaming revenue total for the month remains down over 70% from pre-pandemic totals.

Meeting Expectations

The city of Macau has been struggling for quite some time since the onset of the pandemic. Considered Asia’s Las Vegas, Macau regularly welcomes visitors from around the world every year. However, beginning in early 2020, things changed. As COVID-19 became an issue, the SAR isolated itself to avoid an outbreak of cases.

The tactics fared well to keep residents healthy but harmed the gaming industry considerably. For the past few months, travel restrictions have eased, which has led to more visitation in the region. The month seemed to meet the expectations of analysts, with the GGR increasing from October thanks to the mainland China quarantine requirement removal.

Visitors are no longer restricted to a 14-day quarantine upon arrival to Macau and vice versa. Most of Macau’s tourism comes from mainland China, so this was a big help in boosting visitation numbers and revenues.

This year, the gross gaming revenues for Macau come in at just over $9.8 billion. This is a nice increase of 50% from 2020 but still far less than the $23 billion earned back in 2019. The hope is that the upward trend will continue, but there is still quite a way to go to reach similar numbers.

Junket Issues and Industry Changes

The six casino operators in Macau are facing a severe issue coming up next summer as operating rights will end by June 2022. Authorities are set to review the gaming industry as a whole in order to provide better regulations and earnings from casino gaming.

After many years of operation, it seems as though junket groups are going to be no more. For the past few years, junkets have been scrutinized for their activities and have become targets of authorities in Macau and Mainland China.

Just last week, VIP junket industry member Alvin Chau was arrested for charges connected to operating illegal gambling programs from China. Associated with SunCity, Chau is not the only organizer of junkets that faces an investigation. Other junket groups are reportedly under the watchful eye of authorities and face inquiries regarding their operations via mainland prosecutors. Included in the mix are Guangdong Club, Meg Star, and Tak Chun.

Chau has already resigned from Suncity Group and casinos in Macau have confirmed that they are closing VIP gaming rooms that were used by the group.

Junkets have long provided a source of revenues for casinos and were once considered a thriving part of the industry. Now, such operators face the scorn of China President Xi Jinping as he feels the junkets are moving mainland money via casinos and this action is a security risk to the country.

For now, casinos are fighting for revenues and individuals like Chau are in custody. It will be interesting to see how the casinos fare as the year draws to a close and especially next year as reviews are conducted for gaming licensing. Hopefully, everything will work out to where Macau can get back to its old self once again, bringing in visitors and earning higher revenues.

Associate Writer: Simon loves to bet on sports as well as play online slots, and he has a keen eye for sorting out the honest sites from the not so honest.