SJM Holdings Ltd says it will use to its advantage the regulatory changes in the Macau satellite casino sector – and its decision to redeploy satellite-venue tables to its downtown Grand Lisboa property and to an upgraded and expanded Casino Lisboa next door – to “consolidate a leadership position on the peninsula” of the city.
That would result in the group “effectively increasing non-gaming spend and length of stay by customers, and better aligning the peninsula [property] portfolio towards the VIP and premium-mass segments” of gaming customers, said the company in commentary in its interim report published on Monday.
In an August filing, the firm said its unit SJM Resorts Ltd had signed a promissory agreement with the group parent Sociedade de Turismo e Diversões de Macau SA (STDM) to acquire a portion of Hotel Lisboa, for a total consideration of HKD529 million (US$68.1 million).
At the time, SJM Holdings said “SJM Resorts intends to utilise the property to expand the current operation of Casino Lisboa by an additional 7,504 square metres [80,772 sq. feet], which will include former gaming areas and expansion of new facilities”.
The August filing stated that would be “supported by the anticipated reallocation of certain gaming tables and slot machines from satellite casinos scheduled to cease operations by the end of 2025”.
In its interim report, SJM Holdings stated the acquisition of space for gaming at Hotel Lisboa – along with reallocation of some gaming inventory to Casino Grand Lisboa across the road – would help it “realise the full benefits of the satellite portfolio restructuring and preserve the geographic loyalty traditionally associated with the Macau peninsula”.
Some investment analysts have recently suggested the exit of group satellites could see SJM Holdings lose market share on the peninsula.
But in the interim report the group said the concentration on Casino Grand Lisboa and Casino Lisboa was “expected to strengthen SJM’s position by centralising resources within a high-volume hub, broadening the catchment, and supporting earnings growth through improved asset productivity and sharper yield management”.
In June, SJM Holdings said it will cease operating seven of its nine satellite casinos by year-end, with one shuttered at the end of July. Most are in the peninsula district of the city.
Only the Ponte 16 and L’Arc Macau satellites of the group are expected to continue operations beyond 2025, with SJM Holdings having previously announced plans for them to become part of the group’s portfolio of self-promoted operations.
On Monday, Moody’s Ratings affirmed the ‘Ba3’ corporate family rating of SJM Holdings Ltd, but changed the firm’s outlook to ‘negative’ from ‘stable’.
The institution said the change of outlook reflected “a high likelihood” that SJM Holdings’ financial leverage would “remain elevated over the next 12 to 18 months, given its weaker-than-expected results in the first six months of 2025”.
SJM post-satellite
SJM Holdings asserted in its interim report that “the two iconic interconnected properties Grand Lisboa and Hotel Lisboa” – linked by an air-conditioned walkway across a public road – “already form the largest integrated resort on the Macau peninsula.
The casino group also stated in its interim report: “The nine satellite casinos have historically operated on a profit-sharing model. Following the restructuring, SJM will redeploy its gaming tables and slot machines to more centralised, self-owned locations, gaining full control over product, service and compliance standards, enabling a consistent ‘Lisboa’ brand experience and more effective player development.”
It added: “These changes will also support the expansion of operational scale, streamline cost structures, and strengthen the group’s earnings quality, positioning SJM to compete more effectively and capture incremental non-gaming spend through tighter integration of hotel, dining and entertainment offerings.”
Regarding the group’s non-gaming offerings, the interim report said it had a “strong pipeline of newly completed culinary and MICE [meetings incentives, conferences and exhibitions] facilities, with licensing expected within the year”.
These would be “powerful drivers of revenue, visitation, and high-value business once fully launched, further enhancing the group’s ability to capture both mass-market and premium segments,” suggested the commentary.
It said its Grand Lisboa Palace Resort in Cotai had completed work on seven new dining outlets offering European, Chinese, and other Asian food, including “internationally-renowned branded restaurants alongside self-operated casual venues”.
At that property, the Garden House, “a flexible indoor-outdoor space, and the Grand Hall, a 2,900-square-metre [31,215 sq. foot] technologically advanced venue, are both completed and awaiting licensing,” said the casino firm.
At Grand Lisboa downtown, there would be three additional food outlets. Grand Lisboa was also preparing to launch “refurbished function rooms and a grand ballroom upgrade,” added the casino firm.
“Once licensed, these venues will materially expand hosting capacity, strengthen competitiveness in attracting high-value and corporate travellers, and establish SJM as a strong contender in the mid-sized MICE sector,” added the firm.
