Hong Kong-listed casino firm Galaxy Entertainment Group (GEG) went from strength to strength in Q1, reporting adjusted earnings up 38% to $3.8b, a new company record. Macau’s third-place casino operator by market share also reported record revenue of $20.2b in the first three months of 2014, up 33% year-on-year and 7% sequentially. GEG enjoyed strong performances in both the VIP and mass market gaming sectors, with VIP revenue up 32% to $14.6b and mass revenue up 37% to $5.1b. Lui Che Woo (pictured fanning himself with some pieces of scrap paper), GEG’s chairman and Asia’s richest casino dude, struck a humble note by noting that 2014 had “begun well.”
GEG’s flagship property Galaxy Macau reported its 11th consecutive quarter of earnings growth, rising 44% year-on-year to $2.8b. Rolling chip turnover rose 50% to $252b while net win rose 47% to $8.7b. Mass table drop rose 10% while win rate rose 11.4 points to a healthy 45.2%, pushing net win up 47% to $3.3b. Slots handle rose 44% and net win rose 15% to $412m. Galaxy Macau’s non-gaming revenue was flat at $375m.
StarWorld Macau boasted a personal best quarterly revenue of $6.8b (+19%) thanks to a 43% rise in mass gaming win to $1.1b. VIP revenue rose 16% to $5.5b while slots win fell 19% to $52m due to a 1.9 point drop in hold. Earnings from the City Clubs brand operations rose 4% to $48m.
Looking ahead, GEG says Phase 2 of Galaxy Macau – a smorgasbord of entertainment, retail and leisure options that will double the size of the current resort – is on budget and on schedule for a mid-2015 launch, while construction of Phases 3 and 4 could get underway before the end of the year. The refurbishing of the Grand Waldo Complex adjacent to Galaxy Macau is also looking good for an early-2015 relaunch. GEG reports it has a whopping $11.7b cash on hand and is “virtually debt free,” giving the company lots of options for kitting out its new resort project on Hengqin island. So, yes indeed, the year has begun well.