Macau casino operator Galaxy Entertainment Group Ltd on Thursday said its annual profit decreased by 60 percent in year-on-year terms to HKD4.2 billion (US$540.6 million). The 2015 results included HKD1.2 billion of non-recurring charges and were also impacted negatively by win rates, the firm said in a filing to the Hong Kong Stock Exchange.
Galaxy Entertainment recorded annual adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) of HKD8.7 billion, a decrease of 34 percent from 2014. The firm said bad luck in its gaming operations reduced the adjusted EBITDA by approximately HKD210 million.
Market wide casino gross gaming revenue (GGR) in Macau declined 34.3 percent in 2015 compared to the previous year, according to official data.
The casino operator reported operational cost control savings of approximately HKD500 million last year, saying it expects to cut costs by an additional HKD300 million in 2016.
The company posted revenue for full-year 2015 of HKD51 billion, down 29 percent from the previous year. These results included seven months of operations of the second phase of casino resort Galaxy Macau (pictured) and sister property Broadway at Galaxy Macau, both opened on May 27.
Galaxy Entertainment founder and chairman, Lui Che Woo, said the firm “delivered credible financial results” despite the “macro headwinds” that impacted Macau’s gaming industry in 2015.
“Our focus in 2015 was on driving profitable volumes combined with cost control initiatives,” said Mr Lui in a statement, adding that the casino operator “resized VIP areas and optimised areas with higher growth potential, such as premium direct and premium mass”.
Galaxy Entertainment said it finished the year on a positive note, as its fourth quarter revenue and adjusted EBITDA increased sequentially by 8 percent to HKD13.3 billion and by 18 percent to HKD2.5 billion, respectively. Adjusted EBITDA however was down 7 percent year-on-year in the three months to December 31.
The firm’s flagship Cotai property Galaxy Macau saw its full-year revenue decrease by 24 percent year-on-year to HKD35.5 billion. Galaxy Macau’s adjusted EBITDA was 30 percent lower year-on-year at HKD6.9 billion.
Galaxy Macau’s total VIP rolling chip volume for the year was HKD555.1 billion, 41 percent lower than in 2014. This resulted in revenue from VIP operations of HKD19.9 billion, down 37.2 percent from the prior year, while revenue in the mass segment decreased by 4 percent year-on-year to HKD11.6 billion.
In the three months to December 31, VIP revenue at Galaxy Macau was HKD5.2 billion, a 30-percent fall from the prior-year quarter but up 16 percent sequentially. In the mass segment, fourth quarter revenue increased by 19 percent year-on-year to HKD3.2 billion, the firm said.
Non-gaming revenue at the property for full year 2015 grew by 52 percent year-on-year to HKD2.3 billion, said Galaxy Entertainment.
Broadway Macau reported negative adjusted EBITDA of HKD7 million in its seven months of operation, the firm said, adding that the property has helped “drive traffic across Cotai”.
StarWorld Macau, a casino hotel on Macau peninsula, posted a 37 percent year-on-year decrease in adjusted EBITDA to HKD2.2 billion in 2015. The property generated annual revenue of HKD13 billion, down 42 percent from 2014.
The casino hotel recorded a 52 percent year-on-year decline in VIP revenue in 2015, to HKD8.5 billion, while its mass gaming revenue decreased by 4 percent to HKD4.1 billion.
“StarWorld Macau is in the process of transitioning to a mass centric property and this is exemplified by mass revenue growing [sequentially] in every quarter of 2015,” said the casino operator.
Galaxy Entertainment announced on Thursday a special dividend of HKD0.15 per share, totalling approximately HKD650 million, to be paid on April 29. The company paid two special dividends in May and October last year, amounting to HKD1.8 billion.
“While it is too early to call a bottom to the market especially given the current volatile macro economic environment, sequential growth in Macau’s gaming revenue in the final quarter of 2015, coupled with healthy visitor numbers over the important 2016 Chinese New Year period, potentially signal market stabilisation,” said Galaxy Entertainment’s Mr Lui.
Aug 20, 2018A key to entrepreneur Kazuo Okada reasserting control over...
Aug 17, 2018Entrepreneur Kazuo Okada (pictured) has told GGRAsia that...
Jul 06, 2018The operator of the Widus Hotel and Casino at Clark...
Jun 11, 2018Cambodia has some attributes that make it potentially...
Jun 06, 2018Global gaming supplier International Game Technology Plc...
Sep 21, 2018Police in the city of Cixi, in the mainland Chinese province of Zhejiang, have recently broken up a gambling ring that took bets through a website set up overseas, Chinese-language media from the...
Sep 21, 2018
Sep 21, 2018
”Assuming that our [Tigre de Cristal] phase two project and the other future operators’ development plans remain on track, we may see the benefits of a ‘cluster’ effect [in the Primorye Integrated Entertainment Zone] as early as 2021”
Summit Ascent, lead developer of Tigre de Cristal