Macau's casino industry has seen its gross gaming revenue (GGR) rise for the third straight month and gaming analysts believe the world's largest gambling hub is finally experiencing a recovery. Melco Crown, one of Macau's six biggest gaming operators, is taking extra care in promoting its market after 18 Crown Resort employees were arrested in China for violating gambling laws during the month of October.
Crown Resorts is the largest shareholder in the Melco Crown venture and owns a 27% stake in the company, and Crown employees have been arrested for promoting and advertising gambling services to attract Chinese VIP gamblers to Australian casino resorts. Melco Crown is taking additional precautions to ensure its marketing materials do not violate gambling laws in China.
In a statement, Melco Crown Chairman and CEO Lawrence Ho said, "We believe that Melco Crown and our efforts in China have always been in compliance with the rules and regulations. And of course, in the wake of Crown's recent incident, we have reviewed all of our standard operating procedures to be more cautious and prudent."
Authorities are angry that Crown's high rollers could be targeted by authorities after reports of confiscating the Crown resort's VIP client list in China. Ho said some of Melco Crown's VIP gamblers are likely to hesitate to visit their casinos in light of recent arrests and allegations, but admitted it was too early to predict whether the company would negatively impact VIP revenue in the future.
Melco Crown operates a number of casinos in Macau, including the City of Dreams, Altira Macao, Mocha Club, and Studio City, and the Macau Game Authority has previously instructed all six major casino operators to be careful not to violate gambling laws. Game analysts also believe the recent arrests in China will not have a significant impact on the Macau casino industry, as they have targeted gambling-related promotional activities in overseas casinos.
Melco Crown reported third-quarter financial results showing revenue of $945.7 million during the third quarter of 2015 and increased to $1.15 billion during the third quarter. The company posted a profit of $33.2 million in the second quarter of 2016, up nearly 50% to $62 million in the third quarter. Melco Crown attributed its strong third-quarter earnings to Studio City's focus on public market gamblers and increased revenue from its dream city Manila casino.