Macau casino operator SJM Holdings saw profit nudge up 1.9% in the first six months of 2014, despite the raft of negative factors currently weighing down the world’s top casino gambling hub. Revenue from the 20 Macau casinos that operate under SJM’s license rose 4.7% to HKD 44.4b (US $5.7b) while earnings rose 4.1% to HKD 4.4b ($567.6m) and profit hit HKD 3.9b ($245.1m).
In keeping with market trends, SJM’s mass market table game revenue rose 29.1% to HKD 15.7b while VIP tables revenue fell 5.1% to HKD 27.7b and slots revenue fell 8% to HKD 668m. VIP operations remained 62.8% of SJM’s overall revenue but that’s down 6.6 points from the same period last year. VIP win rate slipped 0.17 points year-on-year to 2.76%. SJM says it managed to maintain its market-leading position among Macau’s six licensed concessionaires, capturing 24.6% of mass table revenue and 23.9% of VIP action. However, its overall 23.5% share is down from 25.3% in the same period last year.
Revenue at SJM’s flagship property Casino Grand Lisboa rose 5% to HKD 16.2b while profit rose 2.2% to HKD 2.2b. Business at SJM’s other self-promoted casinos – Casino Lisboa and Casino Oceanus at Jai Alai – fell 5.3% to HKD 5.8b but the previous year’s numbers benefited from the operations of Casino Jai Alai which was closed for renovations last spring. Revenue at SJM’s 15 third-party promoted casinos rose 7.5% to HKD 22b. Non-gambling revenue from the Grand Lisboa Hotel slipped 4% to $327m while SJM’s 51% share of the Sofitel at Ponte 16 added HKD 117m (+24%).
Looking ahead, the company celebrated the groundbreaking this February of its $4b Lisboa Palace property on Cotai. The sprawling resort-casino is expected to open its doors in 2017 with 700 gaming tables and 1k slots along with numerous entertainment and shopping options. The Palace will also boast 2k hotel rooms, 270 of which will reside in a 20-storey exclusive tower designed by Karl Lagerfeld, marking the first time the designer has put his stamp (not to mention his name) on such a property.
