Mass gaming leads SJM Holdings to 241% year-on-year increase in GGR to US$722 million

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Macau concessionaire SJM Holdings reported gross gaming revenues of HK$5.66 billion (US$722 million) in the three months to 30 June 2023, up 241% year-on-year and 35% higher than the March quarter.

However, gaming revenues were still at just 56% of pre-COVID levels, largely due to the collapse of the junket industry. Group-wide VIP GGR was just 15% of 2Q19 levels at HK$512 million (US$65 million), while mass table games were back to 72% at HK$4.35 billion (US$555 million) and slot machines and ETGs back to 97% at HK$421 million (US$54 million).

Non-gaming revenue of HK$372 million (US$47 million) was up 26% quarter-on-quarter and more than double the HK$172 million (US$22 million) recorded in 2Q19.

Adjusted EBITDA of HK$430 million (US$55 million) reversed a 2Q22 loss and compared with Adjusted EBITDA of just HK$31 million (US$4 million) in Q1, representing 43% of pre-COVID levels. By property, Grand Lisboa reported Adjusted EBITDA of HK$317 million (US$40 million), up 103% quarter-on-quarter, while self-promoted casinos – Casino Lisboa and Casino Oceanus at Jai Alai – improved by 26% to HK$329 million (US$42 million). Cotai property Grand Lisboa Palace (GLP) narrowed its Adjusted EBITDA loss from HK$230 million (US$29 million) in Q1 to HK$62 million (US$8 million) in Q2, although management told analysts during its earnings call overnight that GLP had turned profitable in July.

Notably, the company’s satellite casinos reported an Adjusted EBITDA loss of HK$103 million (US$13 million) – largely flat with Q1 – with JP Morgan’s DS Kim explaining that “the pace of rationalization of excess staff (from five satellite casinos that ceased operation last year) was much slower than expected.”

For the first six months of 2023, GGR grew by 125% year-on-year to HK$9.17 billion (US$1.17 billion), while Adjusted EBITDA of HK$461 million (US$59 million) reversed a HK$1.18 billion (US$151 million) loss in 1H22. Loss attributable to the owners of the company in the first six months of the year narrowed from HK$2.76 billion (US$352 million) a year earlier to HK$1.26 billion (US$161 million).

SJM said it held an 11.8% share of Macau gaming revenue in H1, including 14.9% of mass market table gross gaming revenue and 3.5% of VIP gross gaming revenue.