Profits increase for the Macau gaming giants

Business | Tereza Cai 1 Mar 2019

Two Macau gaming companies saw increased profits last year.

The net profit of Galaxy Entertainment (0027) for 2018 rose 28.59 percent year-on-year to HK$13.51 billion, beating market expectations. It declared a special dividend of 45 HK cents, without declaring a final dividend.

Net profit was HK$14.1 billion, up 28 percent year-on-year after adjusting for HK$0.6 billion of non-recurring charges.

The group said that it will focus on the mass casino business, and will expand the non-casino business, following the government's expectation of diversifying development.

It expected the HK$1.5 billion property enhancement program for Galaxy Macau and StarWorld Macau to be completed in phases this year and next year.

Full-year revenue rose 14 percent year-on-year to HK$55.2 billion, and the fourth-quarter group revenue was HK$14.2 billion, up 2 percent year-on-year and up 9 percent quarter-on-quarter.

Chairman Lui Che-woo believed that Macau's tourism industry would be more prosperous, benefiting from the Greater Bay Area development.

Lui said he would respect the Macau government's decision on the licenses of the casino industry.

SJM Holdings (0880) posted a year-on-year increase of 45.2 percent in its net profit to HK$2.85 billion for 2018, with a final dividend of 21 HK cents per share.

Net gaming revenue earned by Sociedade de Jogos de Macau SA (SJM), a subsidiary of the company, was HK$33.68 billion in 2018, an increase of 8.3 percent from the previous year.

The subsidiary SJM had a 14.9 percent share of Macau's gross gaming revenue, including 19.5 percent of mass-market table-gaming revenue and 12.2 percent of VIP gaming revenue. The group's flagship casino Grand Lisboa had an increase in gross gaming revenue of 4.7 percent, and 24.3 percent increases in adjusted EBITDA and a 33.8 percent increase in net profit.

Construction of the Grand Lisboa Palace, the group's integrated resort on Cotai, is proceeding apace and the group is looking forward to completing construction in the first half of this year and beginning operations as soon as possible.

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