{"id":1659334,"date":"2022-04-12T14:01:58","date_gmt":"2022-04-12T18:01:58","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=208973"},"modified":"2022-04-12T14:01:58","modified_gmt":"2022-04-12T18:01:58","slug":"macau-outlook-worsens-ubs-sees-five-years-to-rebound","status":"publish","type":"station","link":"https:\/\/platogaming.com\/plato-data\/macau-outlook-worsens-ubs-sees-five-years-to-rebound\/","title":{"rendered":"Macau Outlook Worsens, UBS Sees Five Years to Rebound"},"content":{"rendered":"\n<p>As coronavirus cases surge in mainland China, the Chinese Communist Party (CCP) is again employing harsh, ineffective lockdowns, sapping Macau\u2019s recovery prospects in the process.<\/p>\n<figure id=\"attachment_208974\" aria-describedby=\"caption-attachment-208974\" data-style=\"width: 1200px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-208974 lazyload\" src=\"https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound.jpg\" data-src=\"https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound.jpg\" alt=\"Macau rebound\" width=\"1200\" height=\"800\" data-srcset=\"https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound.jpg 142w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-1.jpg 1024w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-2.jpg 768w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-3.jpg 1536w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-4.jpg 600w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-5.jpg 2000w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/> <noscript><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-208974\" src=\"https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound.jpg\" alt=\"Macau rebound\" width=\"1200\" height=\"800\" srcset=\"https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound.jpg 142w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-1.jpg 1024w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-2.jpg 768w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-3.jpg 1536w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-4.jpg 600w, https:\/\/platogaming.com\/wp-content\/uploads\/2022\/04\/macau-outlook-worsens-ubs-sees-five-years-to-rebound-5.jpg 2000w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><\/noscript><figcaption id=\"caption-attachment-208974\"class=\"text-description\">Casinos on Macau&#8217;s Cotai Strip. Analysts are negative on recovery there. (Image: Anthony Kwan\/<em>Bloomberg<\/em>)<\/figcaption><\/figure>\n<p>Research firms are taking note with none of the most recent batch of commentary on the world\u2019s largest casino anywhere close to positive. UBS goes so far as to say the special administrative region\u2019s (SAR) gaming industry won\u2019t fully recover from the effects of the pandemic for another five years.<\/p>\n<div class=\"callout\">\n<p>The six Macau concessionaires generated a combined $36 billion in revenue in 2019 &#8212; the last year prior to COVID-19. UBS estimates that figure this year will be just $12 billion. The Swiss bank also pared its 2023 Macau gross gaming revenue (GGR) outlook by 15%.<\/p>\n<\/div>\n<p>Those bleak estimates are far cries from what analysts expected at the start of the pandemic. Despite a 15-day shutdown of casinos in February, conventional wisdom at that time was that Macau\u2019s gaming industry would bounce back more rapidly from the health crisis than other casino markets, including Las Vegas.\u00a0 However, the opposite is proving true. Las Vegas, though not all the way back, <a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/www.casino.org\/news\/caesars-readying-strip-asset-sale-post-888-deal-says-cbre-analyst\/\">is thriving<\/a>, and so are US regional casinos, while Macau is flailing.<\/p>\n<h2>Concerning Cash Outlook<\/h2>\n<p>Recently, some analysts voiced concern about <a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/www.casino.org\/news\/macau-casino-operators-dealing-with-cash-concerns\/\">the cash positions of Macau concessionaires<\/a>, noting some may only have enough to capital to survive through the end of this year.<\/p>\n<p>UBS echoes that refrain, pointing out that based on 2021 cash burn rates, the six operators have capital to survive anywhere from 1.1 years to 7.2 years. The bank says Grand Lisboa is the worst off, with cash to survive no more than 1.5 years, based on current burn rates.<\/p>\n<p>Making matters worse is that looming first-quarter earnings reports are unlikely to provide any relief, as Morgan Stanley expects MGM China, SJM, and Wynn Macau will each report negative earnings before interest, taxes, depreciation and amortization (EBITDA) for the January through March period.<\/p>\n<blockquote class=\"main-blockquote\">\n<p><strong>Our cash flow analysis shows that companies\u2019 cash can last for eight to 44 months, but that is based on fourth-quarter financials. March\/April 2022 are much weaker, and cash drain is much higher,\u201d<\/strong> according to the bank.<\/p>\n<\/blockquote>\n<p>Some research firms estimate the first quarter of 2022 was the worst three-month stretch for Macau operators since the July through September period of 2020.<\/p>\n<h2>Maybe Some Signs of Hope<\/h2>\n<p>Amid <a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/agbrief.com\/news\/macau\/08\/04\/2022\/macau-to-return-to-2019-ebitda-profitability-next-year-on-improved-business-mix-bernstein\/\">ballooning debt burdens<\/a> and a shutdown of Shanghai, among other Chinese cities, optimism is hard to come by. Investors and operators alike will take it where they can get it.<\/p>\n<p>Bernstein sees Macau GGR returning to 80% of pre-pandemic levels next year. That&#8217;s with some border restrictions loosening in the second half of this year\u00a0 and notes the shares of the concessionaires are inexpensive.<\/p>\n<p><strong>\u201cWe expect outperformance as the recovery kicks in over the next 12 months,\u201d according to the research firm.<\/strong><\/p>\n<p>The post <a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/www.casino.org\/news\/analysts-are-increasing-bearish-on-near-term-macau-recovery\/\">Macau Outlook Worsens, UBS Sees Five Years to Rebound<\/a> appeared first on <a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/www.casino.org\/news\">Casino.org<\/a>.<\/p>\n<ul class=\"plato-article-bottom-links\">\n<li><a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/www.coinsmart.com\/europe\/?irclickid=yCMxLCU1uxyLWzG0Rw0UrUzuUkEV0C2N%3ATwq0A0&#038;irgwc=1\" class=\"plato-coinsmart-gid\">Coinsmart. Europe&#8217;s Best Bitcoin and Crypto Exchange.<\/a><\/li>\n<li><a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/platoblockchain.com\" class=\"plato-blockchain-gid\">Platoblockchain. Web3 Metaverse Intelligence. Knowledge Amplified. FREE ACCESS.<\/a><\/li>\n<li><a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/app.cryptohawk.ai\/signup?via=Platodata&#038;_ga=2.197340463.1063417679.1638720459-1786082276.1633102604\" class=\"plato-cryptohawk-gid\">CryptoHawk. Altcoin Radar. Free Trial.<\/a><\/li>\n<li><a rel=\"noopener\" target=\"_blank\" href=\"https:\/\/www.casino.org\/news\/analysts-are-increasing-bearish-on-near-term-macau-recovery\/\">Source: https:\/\/www.casino.org\/news\/analysts-are-increasing-bearish-on-near-term-macau-recovery\/<\/a><\/li>\n<\/ul>\n","protected":false},"author":1,"featured_media":1659335,"template":"","meta":{"_eb_attr":"","type":"","auto_type":false,"post":"","stream":"","stream_url":"","waveform_data":[],"duration":0,"bpm":0,"downloadable":false,"download_url":"","purchase_title":"","purchase_url":"","post-count-all":0,"like_count":0,"download_count":0,"editor_note":"","copyright":"","captions":[]},"genre":[102],"artist":[106],"mood":[],"activity":[],"station_tag":[5764,5207,12554,12278,5208,12801,3620,5253,5752,12802,3787,12959,3788,7951,3790,3791,3792,5385,5387,5559,10997,5808,5809,13537,7748,5289,5393,5867,8841,5597,6323,5599,5397,6325,7399,6172,7882,3807,3638,5404,177,6304,5835,13353,3643,3715,3716,5469,5413,6328,3646,12634,5238,6352,12549,5795,5815,5622,5536,7339,3654,3831,12550,12379,11969,5480,3757,7698,3722,5881,5627,7347,6069,3673,13425,5777,5742,5546,5547,3836,3675,5490,5824,6020,8835,6356,3841,3681,8153,3760,6358,6439,5230,6099,5577,3690,12552,3692,3732,12640,3697,5279,3703],"_links":{"self":[{"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/station\/1659334"}],"collection":[{"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/station"}],"about":[{"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/types\/station"}],"author":[{"embeddable":true,"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/users\/1"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/media\/1659335"}],"wp:attachment":[{"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/media?parent=1659334"}],"wp:term":[{"taxonomy":"genre","embeddable":true,"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/genre?post=1659334"},{"taxonomy":"artist","embeddable":true,"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/artist?post=1659334"},{"taxonomy":"mood","embeddable":true,"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/mood?post=1659334"},{"taxonomy":"activity","embeddable":true,"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/activity?post=1659334"},{"taxonomy":"station_tag","embeddable":true,"href":"https:\/\/platogaming.com\/wp-json\/wp\/v2\/station_tag?post=1659334"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}