CASINO

Mass market sales bring down Grand Emperor Hotel owner’s profits

TAGs: grand emperor hotel, Macau

Emperor Entertainment Hotel Limited reported a profit of HKD155.7 million ($19.9 million) for the six months ended September 30, 5.3% lower than the same period last year.

Mass market sales bring down Grand Emperor Hotel owner’s profitsIn its filing at the Hong Kong Stock Exchange (HKSE), the owner of the Macau Grand Emperor Hotel said that its casino’s revenue was HKD546.7 million ($69.9 million), 6.8% lower than the same period last year.

“While VIP segment delivered stable performance, gaming concourse segment was lackluster as a result of capacity expansion in Cotai. Nevertheless, the Group strived to enhance the table yield and improve customer segmentation, which enabled the Group to mitigate, to a certain extent, the impact of heightened competition,” the report read.

Total revenue from April to September of this year was HKD665.6 million ($85.1 million), 5.2% lower year on year. Of this, gaming operations contributed HKD546.7 million ($69.9 million). Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) was HKD194.7 million ($24.9 million), of which HKD165.1 million ($21.1 million) came from gaming.

Gross win in its casino’s 67-table gaming concourse targeting the mass market was HKD552.3 million ($70.6 million), down 11.8% from HKD626.5 million ($80.1 million) posted in the corresponding period last year. Revenue was HKD309.8 million ($39.6 million), constituting 46.5% of total revenue for the period.

The 10-table VIP room, meanwhile, brought in HKD217.4 million ($27.8 million), 32.7% of total revenue for the period.

Hotel revenue from the Grand Emperor and the Inn Hotel Macau brought in HKD118.9 million ($15.2 million), or 17.9% of total revenue for the two quarters.

The company recognized the ongoing trade war between the U.S. and China, which many fear will raise prices of goods on both sides, but it said, “the Group is still positive regarding the long-term growth prospects for Macau’s gaming market given the increasing visitation and penetration of Chinese tourists to the city.”

It noted that the newly opened bridge connecting Mainland China to its special administrative region Macau, “provides an underlying support for a sustained growth.”

The company also said it will be focusing on ways to enhance its VIP segment, which it considers its “core strength.”

Last October, Emperor Entertainment announced its purchase of an additional 15% of Luck United, operator of the Grand Emperor casino. This increased the company’s stake to 75%.

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