Galaxy Entertainment Group (HKSE: 0027) beat analyst estimates to post record pre-tax earnings in the second quarter of HK$3.02 billion (US$389 million).
“The prospects for Macau and our company for the rest of this year and beyond are encouraging,” Chairman Lui Che Woo said. “Macau will benefit from the major infrastructure and transport improvement, and the VIP growth will remain robust.”
Nine analysts polled by Bloomberg had forecast EBITDA of $2.88 billion.
First-half net income surged 35 percent to $4.6 billion (US$593.19 million) on a 9% increase in revenues to HK$30.8 billion.
VIP turnover at the company’s flagship Galaxy Macau dropped 4% year on year to HK$178.2 billion in the second quarter, while mass gaming revenue grew 13% to $6.85 billion.
Company-wide, though, VIP growth has been “solid,” said Deputy Chairman Francis Lui. “It grew by 10 percent in the first half. I don’t see VIP spending falling dramatically for the rest of this year.”
He said the group will add 12 VIP gaming tables to Galaxy Macau by October. The company has approval to add 50 tables this year under the government’s 3% cap on annual table growth market-wide.
GEG has raised the budget for Galaxy Macau’s second-phase expansion by HK$3.6 billion to HK$19.6 billion, doubling the size of the resort. The expansion, which is under way and slated for completion in 2015, will add as many as 500 gaming tables and JW Marriott and Ritz-Carlton hotels with a total of 1,300 rooms.
Galaxy plans to spend as much as HK$60 billion to begin the third and fourth phases of the project as early as the end of this year and begin operations from 2016 through 2018.
The company earlier this year completed the HK$3.25 billion purchase of the Grand Waldo casino hotel located near Galaxy Macau and has taken the property off the market for several months of refurbishments.
