GGRAsia – SJM Holdings 1H loss widens, gaming revenue down by 25pct

SJM Holdings 1H loss widens, gaming revenue down by 25pct

Aug 01, 2022 Newsdesk Latest News, Macau, Top of the deck

Macau casino operator SJM Holdings Ltd reported a first-half net loss of nearly HKD2.76-billion (US$351.2 million), compared to a loss of HKD1.47-billion in the first six months of 2021. That was on revenue that declined by 20.9 percent year-on-year, to HKD4.13 billion, due to lacklustre performance both in the mass-market and VIP gaming segments, the firm said in a Monday filing to the Hong Kong bourse.

Group adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) for the first half of 2022 was negative to the tune of almost HKD1.18 billion, compared to the negative HKD510 million recorded in the prior-year period.

The firm said the Covid-19 pandemic “continued to have a materially adverse effect” on the company’s first-half performance. It pointed out that it expected that gross gaming revenues in Macau – as well as hotel, restaurant and other non-gaming activities that depend on tourism – would “continue to be negatively impacted by Covid-19 for an indefinite period in the future.”

SJM Holdings said: “We do not expect a return to our pre-pandemic level of revenue during 2022.

“Even after travel restrictions are lifted, moreover, it is not possible to predict whether there will be lingering economic effects and health concerns caused by Covid-19 that will affect our business for a longer period.”

In a press release on Monday, the company’s vice-chairman and chief executive, Ambrose So Shu Fai, also confirmed the group would take part in the fresh public tender for Macau gaming rights, which is accepting bids until September 14.

“We look forward to successful participation in the tender for new Macau gaming concessions later this year and to our continued presence in Macau for many years to come,” Mr So said.

SJM Holdings’ board did not recommend an interim dividend for the six months to June 30. It already had not recommended an interim dividend in 2021.

Group net gaming revenue for the six months to June 30 declined by 24.9 percent year-on-year, to just above HKD3.81 billion.

Mass market table gross gaming revenue decreased by 21.7 percent year-on-year, to HKD3.44 billion. VIP gross revenue stood at HKD386.9 million in the period, down 54.8 percent from a year earlier.

Revenue from slot machines went down by 6.3 percent year-on-year, to HKD248.0 million.

SJM Holdings’ existing self-promoted casinos are located at the following properties: Grand Lisboa Palace (pictured); Grand Lisboa; and Hotel Lisboa. Other self-promoted units include: Casino Oceanus at Jai Alai – including the gaming area in the Jai Alai building; Casino Eastern; and Casino Taipa. As of June 30, the company also operated 14 third party-promoted gaming venues, i.e., so-called satellite casinos.

Last month, SJM Holdings announced it had completed a refinancing of its syndicated banking facilities, consisting of a HKD9-billion term loan and a HKD10-billion revolving credit.