GGRAsia – Macau Legend 1Q adjusted EBITDA halved

Macau Legend 1Q adjusted EBITDA halved

May 18, 2016 Newsdesk Latest News, Macau, Top of the deck

Casino services firm Macau Legend Development Ltd reported a year-on-year decline of 52.2 percent in adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) during the first quarter of 2016, to HKD35.8 million (US$4.6 million).

Macau Legend’s total revenue for the three months to March 31 decreased by 3.7 percent in year-on-year terms, to HKD350.6 million.

The Hong Kong-listed firm said in a filing on Tuesday that total gaming revenue for the period decreased by 10.6 percent to HKD216.3 million, while non-gaming revenue increased by 9.9 percent year-on-year to HKD134.2 million.

Market wide in Macau, accumulated gross gaming revenue (GGR) for the three months to March 31 was down 13.3 percent year-on-year.

Macau Legend runs two casinos in Macau: Babylon Casino at Macau Fisherman’s Wharf; and Pharaoh’s Palace Casino at the Landmark Macau, both on Macau peninsula. The casinos are operated under the casino licence of Macau gaming operator SJM Holdings Ltd.

In March, Macau Legend announced it had signed a letter of intent to sell its Landmark Macau casino hotel.

New Legend – Macau Legend’s self-run VIP operation – contributed HKD80.6-million in GGR to the firm during the first quarter, an increase of 58.3 percent from a year earlier.

“All gaming segments in Macau including the VIP, premium mass and mass market continue to be difficult but gradually there are signs that the market has stabilised,” said chief executive David Chow Kam Fai (pictured) in a statement.

Macau Legend’s CEO said the firm was taking “positive steps” to reduce risks associated with the current slowdown in Macau’s gaming industry, but he noted the company was also building new capacity for the future. “Our second new hotel [Legend Palace Hotel] at Macau Fisherman’s Wharf is on schedule for a 2016 opening, whereby our mass market and New Legend VIP businesses will have a new five-star environment to upgrade,” said Mr Chow.

Macau’s casino regulator, the Gaming Inspection and Coordination Bureau, told GGRAsia in April that it had not yet received any application regarding the setting up of additional casinos at Macau Fisherman’s Wharf.

Macau Legend is also focusing on Southeast Asian destinations to expand its business. On Friday, the company announced it would pay US$42 million for the right to operate a casino hotel in Laos known as the Savan Vegas Hotel and Entertainment Complex.

The deal also includes the right to a 50-year monopoly on casino operations in three Lao provinces including the one where the resort is located.

Mr Chow said Macau Legend expects “to utilise [its] experience and connections to build [Savan Vegas] into a regional entertainment hub in Southeast Asia”.