Galaxy Entertainment profit up 3 pct in 2014
Macau-based casino operator Galaxy Entertainment Group Ltd on Thursday said its annual profit attributable to shareholders grew by 3 percent year-on-year to HKD10.3 billion (US$1.33 billion) in 2014.
Group revenue for the full year climbed 9 percent year-on-year to HKD71.8 billion, while adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) was up by 5 percent from the prior-year to HKD13.2 billion.
The casino operator, founded by Hong Kong tycoon Lui Che Woo, said the results were largely due to its flagship Cotai property Galaxy Macau (pictured) where adjusted EBITDA grew by 12 percent year-on-year to HKD9.9 billion.
StarWorld Macau, a casino hotel on Macau peninsula, posted a 6 percent year-on-year decrease in adjusted EBITDA to HKD3.5 billion, “as challenging market conditions impacted its VIP business in the second half of the year,” the firm said.
For the final quarter of 2014, the company reported group wide adjusted EBITDA of HKD2.7 billion, down by 25 percent from a year earlier.
Michael Ting of CIMB Securities Ltd in Hong Kong said in a note on Thursday that Galaxy Entertainment’s fourth quarter EBITDA was 4 percent below consensus estimates “due to changes in the revenue mix, as growth in the lower-margin VIP segment outpaced the higher-margin mass gaming segment in addition to higher operating costs”.
The group’s total gaming revenue for 2014 was up by 9 percent year-on-year to HKD71.0 billion. Revenue from the mass-market segment increased by 12 percent year-on-year to HKD18.8 billion in 2014, while VIP revenue climbed 8 percent from the previous year to HKD50.4 billion.
Galaxy Entertainment’s chairman Mr Lui said the company “achieved solid revenue and EBITDA growth … despite facing challenging headwinds in the second half of the year”.
“There can be no doubt that the second half of 2014 was one of the most challenging periods in the history of Macau,” Mr Lui said in a statement accompanying the results.
He added: “It is therefore more important than ever that all stakeholders in the industry and Macau pull together in one direction to ensure Macau fulfils its vast economic and social development potential.”
Macau gross gaming revenue for 2014 dropped by 2.6 percent compared to 2013, the first-ever annual drop.
On Thursday, Galaxy Entertainment announced a special dividend of HKD0.28 per share, payable on May 22, 2015. The company paid two special dividends of HKD0.70 per share and HKD0.45 apiece in July and October respectively, totalling HKD4.9 billion in 2014, it said.
The company also confirmed that the second phase of casino resort Galaxy Macau and the rebranded Broadway at Galaxy Macau would open on May 27.
(Updated on Mar 20, 8.20am)
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