Sands China Ltd., a leading casino operator based in Macau, is launching many measures to lure more foreign players to its facilities, according to company chairman Wilfred Wong Ying Wai.
In addition, he added that “the firm had around 90 percent of its hotel room inventory available during the recent five-day Labour Day break, compared to circa 70 percent in the first quarter.”
Plans to attract foreign customers:
Participating in the Macau government’s tender process for new 10-year gaming concessions, applicants were asked to make plans and pledge investment on a range of issues, involving attracting more foreign customers. Furthermore, before the Covid-19 pandemic, Macau was largely a Chinese tourism market, as visitors from mainland China and Hong Kong visitors accounted for 89.6% of Macau’s 39,4 million visitor arrivals in 2019, according to the Macau government.
Commenting on the ways in which Sands China plans to lure extra foreign customers, Mr Wong told local public broadcaster TDM’s television service: “We are organising our overseas offices, expanding them, so that they recruit customers from Southeast Asia, Japan, [South] Korea.”
He added: “We will use private jets to bring high rollers into Macau. That we have been practising since the introduction of the new concession [in January].”
Mr Wong stated in his comments to TDM that “Sands China planned to conduct many overseas promotions to market its properties in Macau. We are going to Singapore to do a promotion campaign in early June.”
Partnership to attract visitors from Singapore:
In March, Sands China officially partnered with the city’s flag-carrier airline, Air Macau Co Ltd., to provide Singaporian and regional visitors with what it called “an exclusive hotel package and a wide range of privileges.” The offer lasts until June 30.
Moreover, Las Vegas Sands Corp, the parent company of Sands China, operates the Marina Bay Sands casino resort in Singapore.
Reduction of the tax burden:
However, according to Macau’s updated gaming regulatory framework “the city’s chief executive has the authority to reduce by up to 5 percentage points casino operators’ tax burden on casino gross gaming revenue (GGR) generated by players from foreign countries, as a matter of public interest.”
In a related developement, the Macau government confirmed last month that each of the city’s six casino operators had introduced foreigner gaming zones. The establishment of such zones is the first step for operators to be able to apply for tax reductions.
Commenting on the possibility of tax cuts, Mr Wong told the media on Thursday that “Sands China was eyeing to get a reduction on its tax burden based on its work to attract foreign visitors to Macau. He added that the local authorities would complete a review of the firm’s first quarter results regarding its gaming operations for foreigners, before deciding on a potential tax reduction.”
Availability of hotel rooms:
The president of Sands China also said that “the firm had around 90 percent of its hotel rooms available during the recent Labour Day period, or circa 11,000 rooms out a total inventory of about 12,000 rooms. The group’s properties were 100 percent booked for two days of the holiday period, with average booking rates for the rest of the break period tracking 97 to 98 percent.”
On that note, market-wide, and according to the Macao Government Tourism Office “out of the aggregate 46,000 hotel rooms in the Macau market, around 2,000 were not available during the May Day break.”
In addition, Las Vegas Sands Corp mentioned in an earnings presentation released last month along with its first quarter results: “About 3,800 rooms, nearly 31% of Sands China’s total portfolio were out of service in the first quarter, due to labour constraints.”
Mr Wong also acknowledged that “it would be a real challenge for overall GGR in the Macau market to return to pre-pandemic levels.”
“That is because of the significant reduction in junket operations that had taken place in the market. That used to be about 50% of the revenue.”
According to several analysts “changes in the regulatory environment in Macau and in mainland China, the latter historically the main source of high-rollers for junket operations in Macau, have led to a slump in junket business and to the end of many operations.”
On that note, Mr Wang said: “With no junket operations, the rolling volume has come down quite significantly. But on the premium mass and mass levels, we are recovering quite well compared to pre-pandemic levels.
“The yield per costumer is better now, because with junket operations, the concessionaire gets less [revenue].”
A number of brokerages has recently taken an optimistic view when it comes on the pace of profit recovery for Macau’s mass-market gambling segment compared to 2019.
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