Hong Kong-listed Kingston Financial Group Ltd has reported a 10% decline in revenue to HK$913.1 million (US$117.1 million) and 99% decline in profit to HK$2.5 million (US$321,000) for the six months to 30 September 2021, despite booking significant improvement in its Macau gaming business.
According to the company’s interim results announcement, the decline in group performance was primarily attributable to an increase in impairment loss on advances to customers in its margin financing segment.
Kingston Financial is also involved in securities brokerage, underwriting and placements, which saw a 54% year-on-year decrease in revenue to HK$11.1 million (US$1.4 million).
However, Kingston saw gaming revenue at its Macau casinos, Grandview Casino in Taipa and Casino Casa Real on the Macau Peninsula, grow by 238% to HK$18.8 million (US$2.4 million), albeit with an Adjusted Segment EBITDA loss of HK$42.8 million (US$5.5 million). Both casinos are run under license from SJM.
Hotel revenue also increased by 59% to HK$24.1 million (US$3.1 million) with both hotels seeing average occupancy of 37%, still well below pre-COVID levels but higher than the 9% and 4% at Grandview and Casa Real in the prior year period.
Despite the improved performance in its Macau business segments, Kingston noted that its future operating environment remains uncertain given the impact of COVID-19 and changes currently being considered to Macau’s gaming law.
“With the fluctuation brought by COVID-19 pandemic, cross-border travel between the Mainland, Macau and Hong Kong remains uncertain,” management said. “It is still difficult to assess the full impact of COVID-19 on Macau’s tourism and gaming industry.
“In addition, the Macau government launched consultation regarding amendments to the Gaming Law, which proposed tightening a number of requirements, including the introduction of government representatives in casino operators and increasing the percentage of local residents’ shareholding in gaming enterprises in Macau.
“The public consultation has been completed, but there is uncertainty as there is no timetable for the legislation. The Group will regularly review its policy to respond timely to the changing environment and to maintain business stability.”
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