Melco International Development Ltd. saw an 100-fold increase in profit for the year ended Dec. 31, 2016, attributed to the performance of its core gaming arm, Melco Crown Entertainment.
Profit attributable to owners of the company was HK$10.4 billion (US$1.3 billion) for the year ended Dec. 31 2016, compared to only HK$100 million in 2015.
Net revenue was HK$23.9 billion in 2016, increasing 50-fold compared to HK$400 million in 2015.
Adjusted EBTIDA for the year was HK$5.3 billion, up from HK$400 million for the year ended Dec. 31, 2015.
“The increase was primarily driven by the consolidation of Melco Crown Entertainment since May 2016,” said the company in its filing to the Hong Kong Stock Exchange.
In December 2016, Melco announced that it had entered into an agreement to purchase additional interest in its core gaming arm Melco Crown Entertainment Limited.
After the successful completion of the purchase in February 2017, Melco’s ownership in Melco Crown Entertainment increased from approximately 37.9 percent to 51.3 percent.
In 16Q4, Melco Crown Entertainment posted a 13 percent gain in revenue as a result of improved performance at Studio City and City of Dreams Manila.
Revenue came in at $1.19 billion, up from $1.05 billion a year earlier, in line with consensus estimates.
“The move not only strengthens Melco’s financial position, boosting its capability to realise its global expansion vision, but also represents the confidence it has in Macau’s long term prospects,” said the company in its latest filing.
Entertainment Gaming Asia, in which the group holds an effective equity interest of 64.8 percent, recorded consolidated revenue from continuing operations of US$2 million for the year 2016, down 26 percent year-on-year “due to a decrease in gaming operations revenue as a result of expiry of certain machine leasing contracts within the year.”
MelcoLot Limited, in which the group holds 40.7 percent equity interest, recorded a 5.4 year-on-year growth in revenue, reaching HK$60.3 million.