Emperor Entertainment Hotel Ltd, which operates Macau’s Grand Emperor Hotel and Inn Hotel Macau, reported a 28.2% decline in net profit to HK$263.9 million (US$34.1 million) for the financial year ended 31 March 2020, impacted by a significant fall in VIP gaming revenue.
Pointing to US-China trade tensions and the COVID-19 outbreak as the primary contributors to the decline, Emperor E reported a 17.2% drop in group-wide revenue to HK$1.14 billion (US$147 million) including an 18.5% fall in gaming revenue to HK$926.8 million (US$119.6 million) and 11.5% fall in hotel revenue to HK$216.4 million (US$27.9 million).
The VIP gaming space was by far the hardest hit, with rolling chip volume plummeting from HK$19.3 billion in 2019 to HK$10.2 billion (US$1.32 billion) in FY20 and revenue down 37.6% to HK$267.9 million (US$34.6 million). Emperor E’s self-managed VIP room boasts 10 tables.
The main gaming floor saw a 6.3% decline in revenue to HK$623.2 million (US$80.4 million), lifting its share of the group’s gaming revenue from 58.5% last year to 67.3% this time around. Slot machine revenue declined from HK$42.6 million to HK$35.7 million (US$4.6 million).
Despite the suppressed operating environment, Emperor E said it remains confident in the long-term outlook for Macau.
“The unfavorable business environment arising from the pandemic and the volatile global economy are likely to somewhat hinder the development of Macau’s gaming market,” it said.
“In response to the recent downturn in market sentiment, the Group will closely monitor the market situation, and promptly adjust strategies accordingly. As soon as the pandemic is well contained, and the travel restrictions and health control measures upon arrivals are eased, the Group expects that the suppressed desire for leisure and pent-up consumption demand will be unleashed, resulting in an obvious rebound on the number of visitor arrivals.
“The Group strives to stay competitive in the marketplace, and anticipates reaping the greatest benefits when the market revives.”
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