GGRAsia – SJM 1Q EBITDA US$111mln as revenue grows, loss narrows

SJM 1Q EBITDA US$111mln as revenue grows, loss narrows

May 10, 2024 Newsdesk Latest News, Macau, Top of the deck

Macau casino operator SJM Holdings Ltd reported adjusted earnings before interest, taxation, depreciation, and amortisation (EBITDA) of HKD864 million (US$110.5 million) for the first quarter of 2024, compared with HKD31 million a year earlier, the firm said in unaudited highlights filed with the Hong Kong Stock Exchange on Thursday.

The company said it had “exceptional” results for the first three months this year, “posting impressive gains on multiple fronts,” according to a separate press release.

SJM Holdings said it achieved an adjusted EBITDA margin of 12.5 percent in the first quarter of 2024, rising 11.7 percentage points from a year ago, and above the 12.4-percent margin recorded in the first three months of 2019.

The company reported a first-quarter 2024 loss attributable to shareholders of HKD74 million, an improvement on the HKD869-million loss in the prior-year quarter.

The group posted aggregate net revenue of HKD6.92 billion for the January to March period, up 73.0 percent from the prior-year period, and about 80 percent of first-quarter 2019 levels.

SJM Holdings recorded gross gaming revenue (GGR) of HKD6.89 billion in the opening quarter of 2024, a 77.3-percent increase year-on-year, and about 9.0 percent higher sequentially.

First-quarter non-rolling GGR for the group’s self-promoted casinos “reached 134 percent of first-quarter 2019,” stated the firm.

Rolling GGR stood at HKD645 million in the reporting period, up 220.9 percent year-on-year. Non-rolling GGR rose by 71.9 percent year-on-year, to HKD5.71 billion in the opening quarter of 2024, and electronic game revenue reached HKD535 million, 47.0 percent higher from a year earlier.

The firm’s net gaming revenue was just above HK6.46 billion, up 74.5 percent year-on-year, but still about 34 percent lower than the net gaming revenue of HKD10.42 billion in the same quarter of 2019, according to corporate data.

“These robust results not only signal a strong recovery, but also reflect the group’s continuous efforts in ramping up its non-rolling market segments, as well as the initial promising outcomes from the ‘One Platform’ initiative launched in late December 2023,” the company added.

In early March, management of SJM Holdings mentioned the introduction in late December of a new “centralised platform” to manage its self-promoted properties and reposition existing satellite casinos.

The centralised system “aims to better manage operating costs and improve cross property synergies,” stated the company in its Thursday announcement.

‘Strong performance’

The group’s first-quarter non-gaming revenue stood at HKD456 million, up 54.5 percent year-on-year, and a 3.0-percent increase sequentially. It compared with non-gaming revenue of HKD182 million in the first three months of 2019.

“The quarter was characterised by strong performance across all our self-promoted properties, in both gaming and non-gaming sectors,” said SJM Holdings’ chairman Daisy Ho Chiu Fung, in prepared remarks included in the results release.

She added: “It is a clear testament to the effectiveness of management’s focused efforts on improving our internal return-on-investment and our team’s relentless drive for exceptional customer experiences.”

Grand Lisboa Palace in Cotai recorded gross revenue of nearly HKD1.42 billion in the three months to March 31, including GGR of HKD1.11 billion and non-gaming revenue of HKD307 million, as compared with GGR of HKD310 million and non-gaming revenue of HKD164 million a year ago.

The complex’s adjusted property EBITDA was HKD88 million, compared with a negative figure of HKD230 million in the first quarter of 2023.

Grand Lisboa (pictured), the company’s Macau peninsula flagship, delivered adjusted property EBITDA of HKD535 million in the first three months this year, compared with HKD156 million in the prior-year period.

Grand Lisboa’s gross revenue was just under HKD2.00 billion, including GGR of HKD1.88 billion and non-gaming revenue of HKD81 million, as compared with GGR of HKD928 million and non-gaming revenue of HKD64 million in first-quarter 2023.

Among Macau gaming concessionaires with satellite casino interests, SJM Holdings has the greatest number. As of March 31, the nine satellite casinos that use its licence generated aggregate GGR of nearly HKD2.64 billion, up 54.7 percent year-on-year.

But these satellite properties also collectively generated negative adjusted property EBITDA amounting to HKD52 million in reporting period, though that was narrowed from the negative HKD105 million in first-quarter 2023.