Macau casino operator SJM Holdings saw its net gaming revenue, Adjusted EBITDA and profit all head north in the three months to 31 March 2019, but the company’s share of the Macau gaming market failed to keep pace with the competition.
SJM revealed on Tuesday that its GGR accounted for 14.1% of Macau’s casino gaming revenue in 1Q19, down from 14.7% 12 months earlier as it eagerly awaits the launch of its Cotai integrated resort Grand Lisboa Palace, due to open at the end of this year.
Despite the loss of market share, the company recorded 0.8% increase in net revenue to HK$8.48 billion driven entirely by the mass market segment, which booked 7.9% year-on-year and 4% sequential growth to HK$6.19 billion. By comparison, VIP GGR fell 19.4% year-on-year and 16% sequentially to HK$3.94 billion. Company GGR before commissions and incentives was down 4.6% to HK$10.42 billion.
Group Adjusted EBITDA in 1Q19 grew 8.9% to HK$1.08 billion with EBITDA margin up from 11.5% to 12.4%, while profit attributable to owners of the company increased 16.5% to HK$850 million.
SJM’s flagship property Grand Lisboa saw quarterly GGR fall 10% year-on-year to HK$3.52 billion, falling short of analyst estimates although brokerage Bernstein noted that EBITDA margin improved to 17.1% versus 14.2% in 1Q18 on higher hold (3.2%) and better business mix.
“VIP suffered in the quarter (-17%) while mass held up (+3.7%), with hold improvement in Premium Mass, but both did not perform as well as the market,” Bernstein said.
Satellite GGR fell 1% to HK$5.43 billion and self-promoted casino GGR by 4% to HK$1.47 billion.
SJM Vice-Chairman and CEO Dr Amrbose So stated, “We are very pleased that our efforts to strengthen our mass market business have resulted in material increases in SJM’s net profit and Adjusted EBITDA during the first quarter.
“We strive to continue enhancing our business on Macau Peninsula whilst we complete construction of the Grand Lisboa Palace on Cotai.”
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