SJM Holdings reports HK$1.4 bln in losses for H1

Gaming operator SJM Holdings Limited reported HK$1.4 billion (US$176.8 million) in net losses for the first half of this year, the group’s most recent financial report published today (Tuesday) revealed.

In the same period last year, the local gaming group had reported over HK$1.6 billion in net profit attributable to its owners.

‘First half results of the group were severely impacted by the COVID-19 outbreak, which led to the closure of Macau casinos for 15 days in February, as well as ongoing restrictions on entry from the Mainland, Hong Kong and other locations, curtailment of transportation channels and quarantine requirements,’ the company noted.

During this period the gaming concessionaire’s net gaming revenue decreased by 74.4 per cent year-on-year to about HK$4.2 billion, with SJM reporting some HK$984 million in negative Adjusted EBITDA.

The company also claimed that by the end of the six month period under review it held a 15 per cent share of Macau’s gaming revenue, including 22 per cent of mass market table gross gaming revenue and 8.6 per cent of VIP gross gaming revenue.

SJM’s mass-market gross table gaming revenue decreased by 73.5 per cent during the first half of 2020 to HK$3.2 billion, while VIP gross gaming revenue showed a decrease of 81.6 per cent to HK$1.3 billion.

As of June 30 2020, SJM operated 192 VIP gaming tables in operation with 14 VIP junket promoters.

The gaming company also operated 15 satellite third party-promoted casinos also, comprising a total of 514 mass market gaming tables, 78 VIP gaming tables and 510 slot machines, with gaming revenue from its satellite casinos dropping by 74.4 per cent year-on-year to some HK$2.7 billion.

Still, the concessionaire underlined that it had maintained a strong financial position, with bank balances and cash amounting to HK$7.3 billion as of June 30 2020, despite a 49.2 per cent decreased when compared with the position as of December 31 2019.

The company has maintained that depending on the timeline for obtaining the necessary operating permits, its Grand Lisboa Palace is expected to open by the end of 2020.

By the end of June, SJM had entered into capital commitments in connection with the Grand Lisboa Palace project with a total value of approximately HK$5.0 billion.

‘We expect that gross gaming revenues in Macau, as well as hotel, restaurant and other non-gaming activities that depend on tourism, will continue to be negatively impacted by COVID-19 for an indefinite period in the future,’ the group concluded.

‘Whilst certain travel restrictions are likely to be gradually lifted, and that visitation and spending will respond positively to such lifting, we do not expect a return to our
previous level of revenue during any part of 2020′