Galaxy Entertainment Group saw its net revenue grow 6% year-on-year to HK$13.0 billion and Adjusted EBITDA 10% to HK$3.9 billion in 3Q18, the increases coming despite bad luck across all three of its Macau properties and the mid-September closure of casino operations for more than 30 hours during Typhoon Mangkhut.
Galaxy’s results weren’t as strong as the previous quarter, with revenue and EBITDA down 7.0% and 10.0% respectively from 2Q18. Nevertheless, the company recorded its 11th consecutive month of year-on-year EBITDA growth on the back of a standout performance in the mass market segment.
Flagship property Galaxy Macau saw its net revenue increase 7% year-on-year to HK$9.3 billion including gaming revenue of HK$8.2 billion. Rolling chip volume was up 15% to HK$189.6 billion with win of HK$6.4 billion, while mass table drop grew 11.5% to HK$10.7 billion with win of HK$4.4 billion. EGM handle rose 11.3% to HK$527 million.
At StarWorld, net revenue grew 7% to HK$2.9 billion year-on-year with Adjusted EBITDA up 16% to HK$927 million. Rolling chip volume increased 10.3% to HK$73.8 billion with win of HK$2.2 billion while mass table drop grew 13% to HK$4 billion with win of HK$1.7 billion. EGM handle rose 23.9% to HK$41 million.
GEG’s mass-only property Broadway Macau enjoyed a particularly strong quarter, with net revenue for 3Q18 up 38% year-on-year to HK$145 million and Adjusted EBITDA reaching HK$9 million, a 350% sequential increase and 150% higher than the same period last year.
Mass table drop at Broadway increased 31.5% to HK$242 million with win of HK$62 million while slot handle grew 178% to HK$509 million with win of HK$11 million.
Union Gaming analyst Grant Govertsen said Galaxy continues to impress despite concerns over the potential impact of external factors.
“While acknowledging the macro backdrop, management clearly remains bullish on what they’re seeing over the short term: October’s Golden Week volumes were strong (VIP in double digits, mass in high teens) and 4Q is on pace to be the strongest quarter in years (and therefore the strongest of 2018),” he said.
“Obviously one-time events like World Cup in July and the super typhoon in September kept 3Q from being even stronger, but these months book-ended August, which was the strongest month of the year for GEG. At the same time, 3Q was also negatively impacted by construction disruption as all gaming rooms went offline at some point to be retrofitted for smoking lounges.”
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