• About Us
  • The Team
  • Advertise with Us

The latest news on the gaming industry in Asia

() () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () ()
  • Home
  • Macau
  • Philippines
  • Singapore
  • Japan
  • Rest of Asia
  • World
  • Industry Talk
  • Trends & Tech
  • iGaming
  • follow
    • Facebook
    • Twitter
    • RSS Feed
    • LinkedIn

SJM staff cost risk on exposure to satellites: analysts

Jun 17, 2022 Newsdesk Latest News, Macau, Top of the deck  


SJM staff cost risk on exposure to satellites: analysts

Macau casino operator SJM Holdings Ltd is likely to face an increase in its staff costs due to the satellite casino issue, and could face further such liabilities if third-party promoters of such properties decide either to cease casino operations, or if SJM Holdings runs them directly, say a number of analysts.

Fitch Ratings Inc said in a Thursday note on SJM Holdings that its staff costs liability for satellites – a total of 14 such venues run under the company’s gaming licence – could be as much as HKD600 million (US$76.4 million).

Referring to the general trading outlook in Macau, Fitch analysts Samuel Hui, Wendi Wu and Britton Costa wrote: “The challenging operating environment may also encourage more satellite casino owners to cease operation when their contracts expire this month. We estimate staff costs could increase by up to HKD600 million in second half 2022, as SJM Holdings brings gaming staff onto its payroll.”

Brokerage JP Morgan Securities (Asia Pacific) Ltd said in a May 4 note that SJM Holdings’ 14 satellite casinos employed around 6,900 staff, “accounting for about one-third” of the group’s total staff count.

“This could lead to an additional operating expenses burden for SJM in second-half 2022, as it may need to convert some staff – i.e., the staff from satellite casinos that decide to cease gaming operations – onto its direct payroll,” added the instution.

Lei Wai Nong, Macau’s Secretary for Economy and Finance, confirmed in comments at the end of May, that should satellite casinos stop operations, then the licence holder would need to absorb the gaming staff there, into its directly-managed workforce.

If a concession partner takes over directly – as was announced this week by Emperor Entertainment Hotel Ltd, the promoter of the Grand Emperor Hotel and its casino, run under an SJM Holdings licence – then the concessionaire will still face higher staff costs.

Macau satellites are typically hotels with a casino, that promote gaming under a so-called service agreement with one of the city’s gaming concessionaires.

As Macau prepares for a new public tender for 10-year-long gaming rights, coinciding with the expiry this year of the current circa 20-year permits, the city’s government has been planning a shakeup of industry regulation. A portion of it deals with the status of satellites, with some industry commentators saying the proposed new rules are likely to make it harder for them to have a successful business model.

The Macau government has said that if satellites choose to cease gaming, it will be a business decision, not because of rule changes.

Macau Legend Development Ltd, Paradise Entertainment Ltd, and Success Universe Ltd – three Hong Kong-listed firms that between them promote five satellite casinos under the SJM Holdings licence – have respectively made public statements that they wish to retain casino operations at their properties.

In the case of the latter two, in April comments, they mentioned at least until December 31, with subsequently Success Universe – which promotes the Ponte 16 resort near Inner Harbour district – saying it wanted to go on past 2022. Earlier this month, a senior executive at Macau Legend mentioned doing gaming until at least December 31 this year.


  • tweet
Related articles
  • Success Dragon posts FY profit, gaming services rev down
    Success Dragon posts FY profit, gaming...

    Jun 30, 2022  

  • Satellite casino ops still to Dec 31 at Casa Real, Grandview
    Satellite casino ops still to Dec 31 at...

    Jun 29, 2022  

More news
  • Sega Sammy to launch Genesis Crest 43J cabinet in Asia
    Sega Sammy to launch Genesis Crest 43J...

    Jul 01, 2022  

  • Macau monthly GGR for June worst since Sept 2020
    Macau monthly GGR for June worst since...

    Jul 01, 2022  


Latest News

Sega Sammy to launch Genesis Crest 43J cabinet in Asia

Sega Sammy to launch Genesis Crest 43J cabinet in Asia

Jul 01, 2022  

Casino equipment supplier Sega Sammy Creation Inc said in a Friday release it was debuting its Genesis Crest 43J cabinet in Asia. The product will be available at an in-person trade show, G2E Asia:...
Read More
Macau monthly GGR for June worst since Sept 2020

Macau monthly GGR for June worst since Sept 2020

Jul 01, 2022  

Kangwon 2021 average bet 61pct above foreigner casinos

Kangwon 2021 average bet 61pct above foreigner casinos

Jul 01, 2022  

Sign up to our FREE Newsletter

UB8V5.qr.16(Click here for more)

Pick of the Day


638

Aggregate number of Covid-19 cases in the latest Macau outbreak, as of Thursday-end



Most Popular

  • 5-casino Thai market ok says National Assembly committee5-casino Thai market ok says National Assembly committee June 30, 2022
  • Macau tells casinos cut on-duty staff by 90pct: reportsMacau tells casinos cut on-duty staff by 90pct: reports July 1, 2022
  • Macau drops 48hr nucleic acid test for casino staff, guestsMacau drops 48hr nucleic acid test for casino staff, guests June 30, 2022
  • Universal hopes Okada Manila biz listed before Sept 30Universal hopes Okada Manila biz listed before Sept 30 June 30, 2022
  • Only 2 Macau satellites closed as concessions extendedOnly 2 Macau satellites closed as concessions extended June 29, 2022
Copyright 2014-2022 TEAM Publishing and Consultancy Ltd / All rights reserved
  • Code of Ethics
  • Privacy Policy
  • Useful Links
  • Contact Us