SJM Holdings booked a 12.5% increase in profit to HK$3.21 billion and 13.2% increase in Adjusted EBITDA to HK$4.21 billion in 2019 on strong hotel income and lower gaming taxes, but the long wait to launch its Cotai integrated resort, Grand Lisboa Palace, continues to bite with significant declines in VIP prompting a further fall in Macau market share.
While group-wide net gaming revenue dropped 1.5% to HK$33.16 billion, revenue from VIP gaming plummeted by 30.4% to HK$13.69 billion, comprising just 34.2% of SJM’s total GGR compared with 44.8% in 2018. Notably, the company’s VIP market share declined from 12.2% in the previous year to 10.4% in 2019.
It was a better result in mass, where GGR grew 8.9% year-on-year to HK$25.13 billion, and in slots which saw revenue increase 2.5% to HK$1.19 billion.
Nevertheless, SJM’s total share of the Macau gaming market in 2019 fell to a new low of 14.1%, down from 14.9% in 2018, 16.1% in 2017, 19.1% in 2016 and 21.7% in 2015.
Providing an update on the progress of Grand Lisboa Palace – the HK$39 billion property it hopes will reverse that trend – SJM said it has now completed construction work and submitted applications for the relevant licenses in order to begin operations in the second half of the year. When finally open, Grand Lisboa Palace will boast up to 500 gaming tables and 1,000 gaming machines over 27,000 square meters of casino floor space, 1,900 hotel rooms across three luxury hotel brands and 75,000 square meters of retail space.
Meanwhile, peninsula property Grand Lisboa, which contributes around a third of the group’s gaming revenue, saw GGR decline 17.6% to HK$12.91 billion in 2019, with VIP down 31.4% to HK$6.97 billion. Mass market GGR increased 8.1% to HK$5.48 billion and slot revenue by 5.4% to HK$469 million, with Adjusted EBITDA at Grand Lisboa up 12.9% to HK$2.35 billion.
SJM said its other self-promoted casinos, namely Casino Lisboa, Casino Oceanus at Jai Alai and Casino Taipa, booked a 0.7% increase in GGR to HK$6.31 billion while revenue at the 16 satellite casinos operating under the company’s gaming license fell 5.4% to HK$20.78 billion.
