Its analysts said in a recent industry report that the SAR’s gross gaming revenue recovery at the beginning of this year had been faster than anticipated, which should lead to a faster improvement in revenue, cash flow, and a deleveraging of gaming concessionaires.

Following the relaxation of Covid control measures and travel restrictions, mass-market gross gaming revenue has recovered to 67 per cent of the figure recorded in 2019 in the first quarter of 2023, with VIP segment casino revenue recovering to 23 per cent of the first-quarter 2019 level on average.

As a result, the rating agency has revised upward its full-year Macau revenue forecast, anticipating that mass gross gaming revenue will recover to 75 per cent to 85 per cent of 2019 levels this year before a full recovery in 2024.

Meanwhile, S&P Global Ratings predicted that VIP segment gross gaming revenue would remain at approximately 20 per cent to 25 per cent of 2019 levels in 2023.

It also suggested that increased regulations could periodically cause volatility to gaming revenue and profitability.

Several concerns were cited, such as the proliferation of gaming, rapid revenue growth, and perceived corruption – all of which were said to have prompted the Chinese central government to impose visa restrictions, increase scrutiny on the movement of money into and out of Macau, and beef up enforcement of marketing restrictions.

The Macau SAR government’s commitment to diversifying revenue and developing non-gaming amenities can lead to higher capital spending, the analysts stated.

The agency has also revised its rating outlooks for Sands China and Wynn Macau to the ‘positive’ level from the ‘negative’ level, and also gave MGM China and Melco Resorts (Macau) a ‘stable’ rating.