Galaxy posts 6 percent increase in revenue in 18Q3

Galaxy Entertainment Group posted a six percent increase in its net revenue for the third quarter of 2018, reaching $13 billion, with the results held back by bad luck.

VIP volume was up 14 percent year-on-year, above market performance, while mass and slots GGR tracked at 9 percent year-on-year growth, in line with the market.

Group adjusted EBITDA was $3.9 billion, up 10 percent year-on-year.

Galaxy said bad luck in its gaming operations impacted adjusted EBITDA by $332 million.

Normalized adjusted EBITDA was $4.2 billion, up 16 percent year-on-year.

Bernstein Research said the results were in line with its expectations.

“All properties suffered bad luck in hold. Further, results were somewhat negatively impacted by construction disruption at both Galaxy Macau and StarWorld largely due to smoking room buildout impacting VIP and Premium Mass,” it said in a note.

Union Gaming analysts added that the third quarter was also negatively impacted by construction disruption as all gaming rooms went offline at some point to be retrofitted for smoking lounges.

On a property basis, Galaxy said it posted an increase in revenue from its flagship property Galaxy Macau, as well as StarWorld Macau and Broadway Macau. Bernstein noted StarWorld was a standout, posting 13 consecutive quarters of table drop growth.

Looking ahead, Galaxy noted the potential impact of international trade tensions, rising interest rates, and currency fluctuations.

The company said it will also be continuing to plan for the introduction of a full smoking ban in Macau – and will be introducing additional and upgraded smoking lounges next year.

However, the company remained bullish over the long term – with improving infrastructure and access set to drive long-term growth in Macau.