GGRAsia – Galaxy 1Q EBITDA up 49pct y-o-y at US$363mln, flat q-o-q

Galaxy 1Q EBITDA up 49pct y-o-y at US$363mln, flat q-o-q

May 14, 2024 Newsdesk Latest News, Macau, Top of the deck

Macau casino operator Galaxy Entertainment Group Ltd saw mass-market gross gaming revenue (GGR) down slightly quarter-on-quarter in the three months to March 31, but VIP GGR was up nearly 43 percent sequentially, albeit from a much lower base than in pre-pandemic trading.

The company reported first-quarter adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) of nearly HKD2.84 billion (US$362.9 million), up 48.7 percent year-on-year, and up 1.0 percent quarter-on-quarter.

First-quarter net revenue rose 49.6 percent year-on-year, to HKD10.55 billion. Such revenue was up 2.3 percent sequentially.

The firm gave the information in unaudited first quarter performance highlights, filed with the Hong Kong Stock Exchange on Tuesday.

“We were particularly encouraged with our casino performance over the May Golden Week and post the reconfiguration of Galaxy Macau’s gaming floor,” said company chairman Lui Chi Woo, as cited in the announcement.

He was referring first, to a five-day holiday period in mainland China – Macau’s main tourism feeder market – that had started on May 1, and second to changes on the main floor of the group’s Cotai flagship resort, Galaxy Macau.

The group’s first quarter group-wide GGR was just under HKD9.63 billion, up 58.7 percent from the prior-year period. Judged sequentially, it increased by 4.2 percent.

Mass GGR was nearly HKD7.73 billion, up 56.6 percent year-on-year, but down 1.3 percent from the fourth quarter last year.

First-quarter revenue from electronic gaming stood at HKD600 million, up 78.0 percent year-on-year and up 18.1 percent sequentially.

First-quarter rolling chip volume rose 78.5 percent year-on-yearto just under HKD38.46 billion. It was up 11.2 percent quarter-on-quarter.

GGR in the VIP segment was just under HKD1.30 billion, up 63.6 percent year-on-year and 42.9-percent higher sequentially.

The Galaxy Entertainment chairman also noted in is remarks that during the first quarter the firm “made substantial adjustments to Galaxy Macau’s gaming floor”.

While “in the shorter term this was disruptive for the month of January and the early part of February,” once renovation was completed just prior to Chinese New Year, the group had “seen a significant improvement in the flow of customer traffic across the entire floor”.

Mr Lui added, referring to gaming tables with security and casino-currency tracking enhancements: “Across our portfolio, we are in the process of implementing smart tables which will drive further efficiency across the gaming floor.

“Additionally, we are updating our slot machine products and we are working on a range of upgrades to StarWorld Macau,” stated the chairman, referring latterly to the group’s first purpose-built casino-hotel property, launched in 2006.

The chairman also mentioned the April announcement of the Capella at Galaxy Macau hotel to be located in a new luxury tower at Galaxy Macau.

Mr Lui stated: “This represents our continued commitment to delivering unparalleled experiential luxury to our guests in Macau and supporting the [Macau] government’s vision to develop Macau into the world centre of tourism and leisure.”

The company said its balance sheet was “healthy and liquid”. As of March 31, cash and liquid investments amounted to HKD26.4 billion and the net position was HKD25.0 billion after debt of HKD1.4 billion.

Galaxy Entertainment noted: “This provides us with valuable flexibility in managing our ongoing operations and allows us to continue investing in our longer-term development plans. “

The group paid a special dividend of HKD0.30 per share on April 26 this year.

In Tuesday’s announcement, the casino firm said it was “now firmly focused on the development of Phase 4” of Galaxy Macau, “which is already well under way”.

Phase 4 (pictured), scheduled to be completed in 2027, is to include “multiple high-end hotel brands,” as well as a 4,000-seat theatre, retail and a water resort deck. “We will continue to adjust the development timeline in accordance with the market demand,” stated the company.