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Old 10-21-2015, 11:05 PM
 
11,928 posts, read 12,371,750 times
Reputation: 6478
I don't know if anybody is following the meltdown in casino revenue in Macau China. The new president has made it central to his presidency that he is cracking down on corruption. Under his presidency gambling revenue has reduced by 50% as VIP baccarat has dried up.

The two gaming companies most heavily invested in Macau are Wynn Resorts (the legendary hotel builder Steve Wynn) and Sands Corporation who owns the Bethlehem casino. The president of China is not concerned about high living (rooms are still over 95% occupied at an average rate of well over $300) and fancy restaurants are as full as ever. He is only concerned about the VIP gambling that pushed casino revenue in Macau to over $50 billion per year.

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While gaming revenue on the Las Vegas Strip is stable, casino revenue has been dropping at the Venetian|Palazzo resort owned by Sands corporation). The first quarter of 2015 Sands Vegas casino revenue slightly dropped below Sands Bethlehem. It dropped below in both the 2nd and 3rd quarter as well .


Casino Revenue in $ millions
-3rd Q | 2nd Q | 1st Q - subsidiary name (4th quarter 2014)
$127.9 | $86.5 | $111.8 Sands Vegas ($130.0 million)
$134.3 |$128.4 | $118.8 Sands Bethlehem ($123.6 million)


Now Vegas Sands is a big operation which features the largest number of hotel rooms in one complex in the world and a huge convention center. But with revenue dropping, Sands may choose to try and expand Bethlehem by adding another hotel tower and a convention center.

Keep in mind that PA has a much higher gambling tax rate than NV.
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Old 10-22-2015, 07:17 AM
 
2,891 posts, read 5,178,287 times
Reputation: 2127
Quote:
Originally Posted by PacoMartin View Post
I don't know if anybody is following the meltdown in casino revenue in Macau China. The new president has made it central to his presidency that he is cracking down on corruption. Under his presidency gambling revenue has reduced by 50% as VIP baccarat has dried up.

The two gaming companies most heavily invested in Macau are Wynn Resorts (the legendary hotel builder Steve Wynn) and Sands Corporation who owns the Bethlehem casino. The president of China is not concerned about high living (rooms are still over 95% occupied at an average rate of well over $300) and fancy restaurants are as full as ever. He is only concerned about the VIP gambling that pushed casino revenue in Macau to over $50 billion per year.

-----------------
While gaming revenue on the Las Vegas Strip is stable, casino revenue has been dropping at the Venetian|Palazzo resort owned by Sands corporation). The first quarter of 2015 Sands Vegas casino revenue slightly dropped below Sands Bethlehem. It dropped below in both the 2nd and 3rd quarter as well .


Casino Revenue in $ millions
-3rd Q | 2nd Q | 1st Q - subsidiary name (4th quarter 2014)
$127.9 | $86.5 | $111.8 Sands Vegas ($130.0 million)
$134.3 |$128.4 | $118.8 Sands Bethlehem ($123.6 million)


Now Vegas Sands is a big operation which features the largest number of hotel rooms in one complex in the world and a huge convention center. But with revenue dropping, Sands may choose to try and expand Bethlehem by adding another hotel tower and a convention center.

Keep in mind that PA has a much higher gambling tax rate than NV.
Do you think people from China (or people who go to Macau) would instead go to the Sands in Bethlehem? I always thought that the Chinese people at the Sands lived in NYC or in NJ and weren't of the 0.5% to fly to Macau to gamble.
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Old 10-22-2015, 09:15 AM
 
11,928 posts, read 12,371,750 times
Reputation: 6478
China forbids its citizens from taking more than 20,000 yuan (slightly over $3,000) out of the country - a limit that drives Chinese high rollers to seek illegal ways to move cash across the border to Macau, a semi-autonomous region of China since 1999.

To get around these limits, Chinese high rollers turn to VIP junket operators, who use elaborate methods to lend money to gamblers and settle any subsequent debts, often without a paper trail. Many are believed to be linked to organized crime groups known in the region as "triads."

High-end jewelry shops in Macau casinos ostensibly sell expensive gold watches, but, in fact, funnel cash to Chinese gamblers through credit card transactions that look like purchases. The person buys a watch for $120,000 but the store immediate buys it back for $100,000 and has quickly gotten around currency controls for a massive 20% fee. Chinese officials using public money or putup state assets as collateral for gambling debts in Macau.

Junket operators are also popular among casinos aiming to reduce credit default risk and unable to legally collect gambling debts on the mainland, where gambling is illegal. This inherent conflict of interest, together with the anonymity gained through the use of the junket operator in the transfer and commingling of funds, as well as the absence of currency and exchange controls, present vulnerabilities for money laundering.

Quote:
Originally Posted by blazerj View Post
Do you think people from China (or people who go to Macau) would instead go to the Sands in Bethlehem? I always thought that the Chinese people at the Sands lived in NYC or in NJ and weren't of the 0.5% to fly to Macau to gamble.
No, I don't think any mainland Chinese are coming to Bethlehem. Sands has outperformed any other Pennsylvania casino largely because they have the corporate knowledge to appeal to Chinese immigrants or 2nd generation who share the interest in table games. While PARX regularly makes more money in slots because of the larger nearby population, Sands Bethlehem makes more overall profit because of the significantly lower tax rates on table games.

Bethlehem has been by far the smallest of the seven divisions of Sands Corporation (soon to be 8). But in recent fiscal quarters it is the only division that has been growing regularly. Casino revenue has been larger than Vegas division for the all three quarters of 2015.

I wasn't suggesting that the Sands corporation would try and lure mainland Chinese to Bethlehem, just that they may invest heavily since it is the only corporate division that is improving it's revenue.
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