Success Universe Group Ltd, an investor in the Macau casino hotel Ponte 16 (pictured in a file photo), said on Thursday that it expects to “record a decrease of around 40 percent to 50 percent in the unaudited consolidated profit” for full-year 2024.
That compares with a consolidated profit of about HKD169.3 (US$21.8 million) in 2023.
In a filing to the Hong Kong Stock Exchange, Success Universe said the decline in profit was mainly due to: a “substantial increase” in the fair value loss on the group’s investment properties and a write-down of carrying amount in its stock of properties; the recognition of a “substantial impairment loss” of carrying amount of the group’s leasehold land and building classified under property, plant and equipment; as well a decrease in the group’s share of profit of the associates relating to Ponte 16.
Success Universe is a joint venture partner – with a unit of casino concessionaire SJM Holdings Ltd – in Ponte 16, a property located in Macau’s Inner Harbour district. The gaming venue is considered a “satellite” casino of SJM Holdings.
In November, the Macau government approved the long-anticipated expansion of non-gaming facilities at Ponte 16, along with a renewed and amended public land concession for the property. Permitted facilities, according to the announcement, include a “commercial building”, a “plaza”, and a “vessel” named Macau Palace. Work is expected to begin in the first half of 2025.
The “fair value loss on the group’s investment properties as well as write-down of the stock of properties and impairment loss are all unrealised in nature and are non-cash items which will not affect the cash flows of the group,” stated Success Universe in its Thursday announcement.
The company flagged the decline in profit for 2024 despite recording a gain of nearly HKD31.0 million in December from the disposal of part of its shares in electric car maker Tesla Inc.
Success Universe posted a net loss of just under HKD35.5 million for the first half of 2024.
