Macau Legend Development Ltd, the troubled operator of peninsula property Legend Palace as well as the Macau Fisherman Wharf’s precinct, has issued a profit warning on an expected loss of up to HK$640 million (US$80 million) for the year ended 31 December 2024, up from a HK$4.9 million (US$612,500) loss a year earlier.
In a Hong Kong Stock Exchange filing, Macau Legend said the larger loss is primarily due to the recognition of a significant impairment loss in relation to the deposits paid, property and equipment and right-of-use assets held by the group’s investment projects in Macau and Cape Verde.
The group had also recognized a provision for Macau complementary tax of HK$415 million (US$51.9 million) in the prior years resulted from the disposal of a subsidiary, which was written back to profit or loss for the preceding period as disclosed in 2023 Annual Report.
Macau Legend noted that the impairment and write back of provision are non-cash items and do not have an impact on the group’s cash flows and operations but will significantly impact reported performance for the reporting period. This is despite the company noting a 4.3% increase in total reported revenue for FY24. Final results are due to be published by the end of this month.
As reported by IAG, Macau Legend recently had its concession to develop and operate a casino resort in Cape Verde’s capital city of Pria cancelled by the government due to the company allegedly “flagrantly and repeatedly” violating its obligations by failing to resume construction work.
The company also continues to face financial woe and in late August outlined material uncertainties relating to its ability to continue as a going concern.
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