SJM Holdings profit jumps one-quarter on mass market strength


sjm-holdings-profit-jumpsMacau casino operator SJM Holdings started 2018 off on the right foot, posting profits more than one-quarter higher than the year before.

Figures released Wednesday show the Hong Kong-listed SJM’s gaming revenue rising 6.7% year-on-year to HK$8.4b (US$1.07b) in the three months ending March 31. Adjusted earnings improved 17% to HK$987m while profit shot up 25.8% to HK$730m, mainly due to a surge in mass market gaming at SJM’s self-promoted casinos.

The mass market table games segment, which is traditionally more profitable than the junket-led VIP segment, reported revenue rising 9.5% to HK$5.74b. SJM’s average number of mass tables in Q1 rose by 42 to 1,417. Slots revenue was up 14.6% to HK$294m, with the average number of slots in action during Q1 rising by 151 to 2,700.

The VIP segment reported rolling chip turnover rising nearly 13% but VIP win rate slipped 0.39 points to 2.74%, pushing VIP revenue down 1.1% to HK$4.88b. SJM’s average number of VIP tables in Q1 fell by 31 to 284.

SJM’s non-gaming revenue remains something of an afterthought, adding a mere HK$187m to the pile. However, hotel occupancy at SJM’s flagship Grand Lisboa property improved nearly four points to 97.2% in Q1.

SJM’s share of the overall Macau gaming market, which fell to a record low 16.1% in FY17, slipped even lower to 14.7% in Q1, down from 16.7% in the same period one year ago. Regardless, SJM CEO Ambrose So said the company was “very pleased” with the “material increases” in earnings and profit.

The company wasn’t generous with updates on its in-development Grand Lisboa Palace property on Cotai (pictured), saying only that the company “continued to make progress” on the venue’s construction in Q1. Last month, So said he expected a year of “major breakthroughs” on the oft-delayed project, but analysts continue to insist the property may not open until late 2019 or early 2020.

SJM bid goodbye to its aging founder/chairman Stanley Ho last month, and the vacant seat was occupied by Stanley’s daughter Daisy Ho, while two other longtime execs were named co-chair and So was named vice-chair.