The majority of the visitors came from Mainland China and Hong Kong, which accounted for 57.7% and 27.4% of the total respectively. Among the Mainland visitors, 43.3% (678,822) travelled to Macao under the Individual Visit Scheme.

In the first quarter of 2008, visitor arrivals totalled 7,506,309, up by 17.9% over the same quarter of 2007. Visitors from Mainland China rose by 22.6% to 4,385,684; concurrently, those from Hong Kong and Southeast Asia increased by 3.3% and 63.3% respectively. Furthermore, same-day visitors made up 52.6% of the total arrivals, at 3,951,571.

Analyzed by mode of transport, visitor arrivals by sea went up by 10.9% over the first quarter of 2007 to 2,386,943. Among them, 2,164,981 arrived at the Outer Harbour (+8.1%), with 57.6% from Hong Kong and 23.5% from Mainland China.

Visitor arrivals by land increased by 21.4% to 4,704,257. Visitors arriving through the Border Gate rose by 14.8% to 4,448,120 and the majority were visitors from Mainland China (79.1%) and Hong Kong (14.6%).

In addition, visitor arrivals by air stood at 415,109, up by 21.3% over the first quarter of 2007. Visitors arriving at the Macao International Airport grew by 20.5% to 408,094 and those from Taiwan, China (35.0%), Southeast Asia (28.8%) and Mainland China (22.1%) were the major users.

Source :: Macao Statistics and Census Service

• Macau April Visitor Arrivals Continues to Grow
• Macau First Half 2008 Visitors Arrivals Up By 18% to 15 Million
• Southeast Asia Visitor Arrivals to Macau Soared by 81.2%
• Macau Visitor Arrivals Hits Another Record for November 2007
• Macau Visitor Arrivals for January 2008 Up by 16.3%

The Hong Kong-listed company said its net profit in the 12 months ended Dec. 31 was HK$2.69 billion (US$346 million; ?219 million), down from HK$2.84 billion in 2006.

Melco ? controlled by Lawrence Ho, son of Macau gaming magnate Stanley Ho said revenue rose 27 percent to HK$1.02 billion (US$131 million; ?83 million) from HK$801 million.

The company’s board proposed a final dividend of HK$0.01 (US$0.001; ?0.0008) per share, unchanged from a year earlier.

Melco booked a gain of HK$3.1 billion (US$398 million; ?252 million) from the listing of unit Melco PBL Entertainment Macau Ltd. (MPEL) in the U.S. in December 2006.

Melco PBL is one of six licensed casino operators in Macau, the only place in China where casino gambling is allowed.

• Melco PBL Losses Narrows Thanks to Crown Macau
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• SJM to Develop Six More Macau Casinos, Including Cotai Strip
• Melco PBL 2006 Losses Widenend
• Macau’s Biggest Slot Machine Supplier Profit Up By 20%

GDP of Macao for 2007 was estimated at US$19.20 billion, up by 27.3% in real terms and the per-capita GDP amounted to US$ 36,357. GDP for the fourth quarter of 2007 recorded an increase of 22.1% in real terms; meanwhile, the rates for the first and second quarters were revised downward from 25.7% and 31.6% to 25.2% and 30.8% respectively, but that for the third quarter was revised upward from 30.9% to 32.2%; for 2006, the rate of growth maintained at 17.0%.

The favourable factors that contributed to Macao’s relatively high economic growth in 2007 included:

- the continuous increase and improvement in the gaming and tourism facilities, rising number of visitor arrivals led the annual gross gaming revenue (excluding gratuities) soared significantly by 45.8% compared with 2006;
- the bright prospects for the prosperous gaming and tourism sector boosted the investment up by 23.0% in real terms over 2006;
- the annual number of visitor arrivals rose by 22.7% to 26,992,995, together with the increases in the per-capita spending of visitors in all quarters, total visitor spending (excluding gaming expenses) for 2007 registered a 13.9% growth in real terms;
- the notable increase in the employed population and employment income drove the annual private consumption expenditure up by 10.7% year-on-year in real terms.

Changes in the economic structure of Macao

As regards the economic structure, the following changes are observed in 2007:

- the 45.6% surge in the export of gaming services in 2007 fueled net exports of goods and services (exports of goods and services minus imports of goods and services) to accelerate at a faster pace than the level of overall economic growth, contributing to an apparent increase in the relative importance of net exports of goods and services, from 38.3% in 2006 to 43.3% in 2007;
- investment (gross fixed capital formation + changes in inventories) went up by 23.0% in 2007, lower than the overall economic growth, bringing its relative importance in GDP down from 27.5% in 2006 to 26.5% in 2007;
- although increases were registered in both private consumption expenditure and government final consumption expenditure, yet the rates of growth were lower than that of the overall economy. In consequence, the relative importance of private consumption expenditure in GDP went down from 26.2% in 2006 to 22.8% in 2007, while that of government final consumption expenditure decreased from 8.1% to 7.4%.

Photo 1

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Courtesy: Macau Statistics and Census Service

• Macau 2005 GDP Grows at 6.7%
• Macau Q1 2008 Gross Domestic Product Expands by 31.6%
• Macau’s GDP rises 18.8 percent in first quarter of 2006
• Macau Investment Forum to be Held 21-22 February 2008
• Macau Tourist Price Index Up By 3.63%

In December 2007, average earnings (excluding bonuses and allowances) for full-time employees in the Gaming Industry rose by 6.6% year-on-year to US$1,862. Average earnings for employees in positions that are directly related to betting services stood at US$1,867, up by 2.0% over December 2006. The average earnings for services and sales workers, including casino and slot machine attendants/hosts, security and surveillance workers, etc., increased by 10.9% to US$1,119.

At the end of December 2007, the Gaming Industry reported 3,411 vacant posts, a decrease of 2,220 from a year earlier. Of these vacancies, 1,685 were for hard and soft count clerks, cage cashiers, pit bosses, casino floorpersons, dealers, betting service operators, etc., while 994 vacancies were for services and sales workers.

In terms of recruitment prerequisites, 62.7% of the vacancies required no working experience; 94.8% required junior secondary or higher education. Besides Cantonese, other preferred language skills were Mandarin (75.5%) and English (50.7%).

Courtesy :: Macau Statistics and Census Service

• Macau Hotel Employment Surges By 57.8%
• Number of Hotel and Entertainment Employees On the Increase
• Macau Labour Force Increases by 11,300 More
• Macau Unemployment Rate Down to 3.7%
• Macau’s Biggest Slot Machine Supplier Profit Up By 20%

• Interesting Macao article
• Melco stock falls on Stanley Ho’s comments
• Sofitel Ponte 16 to Introduce French Flavours
• MGM Grand Macau Does Not Fear Overcapacity
• Macau versus the Las Vegas Strip: which will be the bigger winner?

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• Paradise Casino Opens at Kam Pek Casino Macau
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City of Dreams Complex

According to the Daily Telegraph, Crown Macau owned by Melco PBL Entertainment, James Packer’s first casino foray in the city had a rocky start after its opening in May last year.

But its fortunes have been given a major boost as a result of a strategic deal late last year with a Hong Kong-listed junkets operator, A-Max, and the decision to refocus the casino entirely on the VIP market.

The aggressive deal with A-Max, which involves higher than industry average total commissions of up to 1.35 per cent, has helped bring VIP gamblers to the upmarket casino, taking market share off more experienced operators, such as Macau veteran Stanley Ho and new players Galaxy and the Macau Sands.

“Thanks to A-Max’s junkets, Melco PBL’s market share improved substantially from 5.7 per cent in November to 18.1 per cent in February, making Crown Macau the busiest casino in the world in terms of betting volume,” Credit Suisse’s Hong Kong-based gambling analyst, Gabriel Chan, says in a bullish new report on the company.

“If we focus on market share in the high-roller segment alone, the improvement was even more astonishing with market share increasing from 6.6 per cent in November to 24.8 per cent in February.”

“A-Max junkets generated about $US5.3 billion ($5.8 billion) in rolling chip turnover in February, up about 5 per cent month on month,” he said.

“In our view, there is room for further growth.

“We expect A-Max’s junkets to generate on average $US6.3 billion rolling chip turnover per month in 2008.” Packer’s Crown now has a 37.9 per cent stake in the company, which listed on the US Nasdaq market in late 2006, alongside the Hong Kong-based Melco, operated by Stanley Ho’s son Lawrence Ho.

Macau observers say the aggressive deal struck with A-Max has seen the junket operator bring in substantial new volumes of high-rollers to Crown Macau, which has been difficult for its rivals to match.

“There has been a dramatic shift in the market since December,” one Macau veteran said last week.

“Stanley Ho’s junket operators have been struggling. Galaxy has been losing market share as well.

“It has not been easy for them to find the consolidators who can bring in the same horsepower as A-Max.”

Under the deal, A-Max, a consolidator of junket operators, receives a total commission rate of between 1.2 per cent and 1.35 per cent from Crown.

A-Max in turn pays its junket operators up to 1.2 per cent.

In the past, Macau casino operators would only pay around 1.1 or 1.2 per cent in total to junket operators to bring in high-rolling gamblers to their premises.

Observers say the financial viability of the Crown Macau deal with A-Max, which involves a potentially higher total commission structure, is dependent on A-Max being able to deliver high volumes, which has so far been the case.

Macau gaming turnover continues to increase, with total monthly revenues twice the level of the Las Vegas strip in recent months.

Unlike last year, which saw a flood of new casino openings in Macau, 2008 is not expected to see any substantial new supply come on to the market, giving the existing operators a chance to consolidate their positions.

The past few months have also seen Crown enjoy an increase in its “hold rate”, or house percentage retained, which has also helped the success of its operations. “Crown’s hold rate was terrible,” said one observer.

“It used to be around 2.2 per cent on baccarat, but now it is 2.7 per cent.”

Crown’s success has put pressure on its rivals to increase the commissions paid to junket operators. As Chan notes in his report, the junket operators now have more bargaining power in Macau than the casino operators.

Chan says that Galaxy’s market share has dropped from 14.9 per cent in November to only 10.3 per cent in February.

“Galaxy has extended credits to select junket operators and raised its commission rate to 1.25 per cent, even higher than the 1.2 per cent A-Max is paying junket operators,” he notes.

The new competition from Crown has also prompted Sheldon Adelson’s massive Venetian, which opened in mid-2007, to revise its commission structure, a move which has helped to boost its market share by 2 percentage points to 12 per cent in February. The Venetian’s commission rate is now 1.26 per cent.

Chan predicts that Melco PBL’s earnings before interest, tax and depreciation could reach as high as $US280 million in 2008. “With a total construction cost of about $US570 million, we estimate Crown’s payback period to be only about two years,” he says.

• Crown Macau: the new VIP king
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• Melco PBL Just Short of Raising US$219 million
• Melco PBL Shares Tumbles 50%

Some readers have raised eyebrows on the lack of commentary on my part on the new SJM properties, saying that I focused purely on the new entrants to the market.

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• Macau Casinos Have Best Security Systems in the World
• Paradise Casino Opens at Kam Pek Casino Macau
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Arriving back from a trip to London, which included informal discussions with European gaming regulators, Manuel Joaquim das Neves said the security in Macau is the best he has ever seen.

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• Paradise Casino Opens at Kam Pek Casino Macau
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• Macau Gaming Revenue This Year to Hit US$12.5 Billion
• The Lowdown on Macau Casinos

This month’s kudos for casino innovation goes to Mike Barlow, Vice President of Food and Beverage at Twin River Casino and the Twin River Casino management team. Mike and the executive team at Twin River Casino are the first casino management team to make an innovative decision to private label an energy drink for their casino.

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• Macau Casinos Have Best Security Systems in the World
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• Global Innovative Submits Lighting Bid for Arc de Triomphe Hotel and Casino Project in Macau