Macau casino operator SJM Holdings Ltd reported a first-half net loss of nearly HKD1.47 billion (US$188.5 million), compared to HKD1.41 in the first six months of 2020. That was on revenue that rose by 19.4 percent year-on-year, to HKD5.22 billion, supported by gains in the mass-market segment, the firm said on a Tuesday filing to the Hong Kong bourse.
Group adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) for the second quarter was negative to the tune of HKD510 million, an improvement on the negative HKD984 million recorded in the prior-year period.
The group’s adjusted EBITDA margin was a negative 9.8 percent, compared with a negative 22.5 percent for the year-earlier period, stated the company.
The firm said the Covid-19 pandemic “continued to have a materially adverse effect” on the company’s first-half performance. But it added that “certain results showed improvement in comparison with the first half of 2020.”
The firm’s board did not recommend an interim dividend for the six months to June 30.
Group net gaming revenue for the six months to June 30 increased by 18.8 percent year-on-year, to just below HKD5.08 billion.
Mass market table gross gaming revenue (GGR) increased by 33.2 percent year-on-year, to nearly HKD4.39 billion. VIP gross revenue stood at HKD855.6 million in the period, down 37.5 percent from a year earlier.
Revenue from slot machines grew by 12.7 percent year-on-year, to HKD264.6 million.
SJM Holdings’ existing self-promoted casinos are: Casino Grand Lisboa at Grand Lisboa (pictured); Casino Lisboa inside Hotel Lisboa; Casino Oceanus at Jai Alai – including the gaming area in the Jai Alai building; Casino Easter; and Casino Taipa. As of June 30, the company also operated 14 third party-promoted gaming venues, i.e., so-called satellite casinos.
Gross gaming revenue at the group’s flagship Casino Grand Lisboa decreased by 9.7 percent year-on-year, to just below HKD1.20 billion. The property’s adjusted casino EBITDA was negative HKD170 million, a 54.1 percent improvement from the prior-year period.
Outside of the reporting period, SJM Holdings launched on Friday the HKD39-billion Grand Lisboa Palace, Macau’s newest casino resort, located on Macau’s Cotai strip. The company’s chairman and an executive director, Daisy Ho Chiu Fung, told GGRAsia that the property might reach break-even in a year “or less”, notwithstanding the challenging business environment due to the Covid-19 pandemic.
“SJM’s operating results in the first half of the year reflect the cautious reopening of Macau for tourism,” said the company’s vice-chairman and chief executive, Ambrose So Shu Fai, in a separate release on Tuesday.
“We anticipate continued growth in the second half of 2021, and we are very pleased that our Grand Lisboa Palace Resort is now open to welcome the increasing flow of visitors,” he added.
Brokerage Sanford C. Bernstein Ltd said in a Tuesday memo that SJM Holdings’ management was “pleased with the first five days’ results” of Grand Lisboa Palace.
“The property visitation was supported by old customers and locals (about 10,000 per day), with 504 hotel rooms now opened,” said the institution.
It added: “Grand Lisboa Palace has attracted some inactive customers from their loyalty programme as they prefer the Cotai experience that SJM previously could not provide – a key question is how many of those customers are there.”
(Updated at 9.30am, Aug 4)
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