Galaxy Entertainment posts record H1 results, Cotai projects on track

    Galaxy Entertainment Group posted record H1 revenue and earnings, driven by strong growth in both the VIP and mass market sectors and said the next stage in its Cotai developments remain on schedule.
    Revenue rose 25 percent year-on-year to $38.4 billion, while adjusted EBITDA rose 26 percent to $7.3 billion. Net profit attributable to shareholders also hit a record of $6.0 billion, up 29 percent year-on-year. The results were in line with expectations, according to UBS.
    Total gaming revenue on a management basis was up 24 percent to $38.2 billion, with mass revenue up 28 percent to $9.9 billion and VIP up 24 percent to $27.5 billion.
    At a news conference yesterday, deputy chairman Francis Lui said that the company would increase its workforce by 50 percent, recruiting 8,000 more workers at the end of this year for the second phase of its Galaxy Macau resort on the Cotai strip.
    The company acknowledged the World Cup had proved a distraction for gamblers in Macau, with total gross gambling revenue in the territory falling in both June and July, but said it remains optimistic about long-term prospects.
    “The fundamental long-term drivers for growth are unchanged, with major infrastructure works and increasing domestic consumption set to drive substantial growth in visitation to Macau in the years ahead,” it said in a Hong Kong Stock Exchange filing.
    The group, which operates the Galaxy Macau and StarWorld Macau properties, also said it will pay a special dividend, its second this year of $0.45 per share, payable on or about 31 October 2014.
    Galaxy Macau, which has been open three years and remains the key growth driver, had H1 revenue of $25 billion, up 38 percent. Adjusted EBITDA for the same period increased by 35 percent to a record $5.4 billion.
    Total VIP rolling chip volume for the period was $517 billion, up 49 percent year-on-year. This translated to revenue of $17 billion, up 44 percent year-on-year. Revenue in the mass segment was $6.4 billion, up 32 percent. Second quarter revenue increased by 19 percent year-on-year to $3 billion, but dipped 9 percent sequentially due to the World Cup.
    StarWorld Macau revenue increased by 7 percent year-on-year to $12.3 billion, on the back of strong growth in the mass gaming segment.
    The company said the Phase 2 of its Galaxy Macau project is on budget and on scale for completion by mid-2015. The Grand Waldo Complex will re-launch in early 2015 following an extensive refit, for which it will unveil plans in Q4, 2014
    Site investigation works for Cotai Phases 3 & 4 are expected to start later this year, doubling its footprint on Cotai to two million square metres.
    It also said it continues to advance its plans to develop a resort on a 2.7 square kilometre land parcel on Hengqin Island. The RMB10 billion ($1.6 billion), low rise, low density resort will complement the Group’s high energy properties located in Macau.