HONG KONG, Nov 20 (Reuters) – Galaxy Entertainment Group (0027.HK) will delay the opening of its new casino in Macau to 2010 from the middle of next year because of a difficult market, the firm said on Thursday.
Some analysts have speculated that work on the Galaxy Macau casino could be stopped because of problems financing the project, following a move by troubled U.S. rival Las Vegas Sands (LVS.N) to halt its projects in the territory.
But in a statement, Galaxy said it was “well capitalised” with about HK$6 billion ($774.2 million) in cash.
“Construction work on Galaxy Macau continues and we have revised the development schedule to better align the opening with market conditions as they improve,” the statement said.
“This is in no way a change in our strategy for Cotai. It is a commercial decision motivated by our objective to achieve a balance between development and the optimization of shareholder returns.”
Last week, Las Vegas Sands laid off nearly 11,000 construction workers while it tries to secure a syndicated bank loan of up to $2 billion to finish a stretch of casino-hotels.
The U.S. firm’s problems are likely to hamper development of the whole of the Cotai Strip — a planned Asian “neon alley” to rival Las Vegas — because the hotels were meant to feed customers to the casinos.
Galaxy said it was confident of funding its new casino on the Cotai Strip because of its cash on hand, credit facilities, income generated from its operations and cost cuts.
Galaxy’s existing casino, StarWorld, notched up earnings before interest, tax, depreciation and amortisation (EBITDA) of HK$136 million in the third quarter, compared to HK$112 million in the previous three months, the statement said.
(US$1=7.749 Hong Kong dollars)
Reporting by Dominic Whiting, editing by Mike Nesbit
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