SJM
ste25
Macau casino operator SJM Holdings Ltd’s free cash flow is likely to remain negative in fiscal year 2025 due to its pledge to fund the acquisition of a portion of Hotel Lisboa (pictured) as well as two other satellite casino properties. The company’s liquidity is also “inadequate” as it is facing “material” financing needs in the next fiscal year, says a memo from Lucror Analytics, a Singapore-based specialist in credit research.
SJM Holdings’ net debt has increased in the first half of the current fiscal year. That was in contrast to its Macau market peers, which mostly reported “stable or lower net debt”, observed Lucror Analytics, in a note carried on the Smartkarma platform.
SJM Holdings reported gross debt of HKD27.26 billion (US$3.49 billion) as of June 30, according to its interim results filing lodged with the Hong Kong bourse on August 28. The casino operator’s cash balance as of June-end was HKD2.4 billion, and its net debt stood at circa HKD24.9 billion, the latter figure up 3 percent from a year ago, noted Lucror Analytics.
“We believe free cash flow will remain negative in fiscal year 2025, as the company has to fund the HKD529-million acquisition of gaming space in Hotel Lisboa, as well as the two satellite casinos (for a currently undisclosed sum) this year,” remarked the institution. The latter venues are Ponte 16 and L’Arc Macau, which are to become SJM Holdings’ self-promoted casinos, the company flagged previously.
The Lucror Analytics memo added, referring to some commercial space on the neighbouring mainland territory of Hengqin Island, that SJM Holdings will convert into a three-star hotel: “The circa HKD800-million acquisition of the Hengqin property will be payable over three years.”
SJM Holdings currently operates eight satellite casinos, following the closure of Casino Grandview in July. Those eight satellite casinos collectively have circa 440 gaming tables and 300 slot machines, said Lucror Analytics. Macau’s old regulatory arrangement of allowing third-party investors to share benefits from gaming via the licences of Macau concessionaires, formally ceases at year-end.
Some satellite tables bound for Casino Lisboa
The SJM group is looking to allocate “25 percent to 35 percent” of its satellite-segment gaming tables and slot machines to a revamped and enlarged gaming area at the Hotel Lisboa. The group is acquiring space at the site, that would “double” the current capacity at Casino Lisboa, Lucror Analytics noted in its memo. It cited management remarks on SJM Holdings’ interim results earnings call.
As well as SJM Holdings being able to “optimise its assets”, via such steps, management “projects that excess staff costs arising from the shutdown of satellite casinos will be manageable: a problem the company faced in 2023 to 2024 after it closed five satellite casinos,” noted Lucror Analytics.
SJM Holdings has been encouraged by the city’s government to absorb the gaming staff from closing satellite properties and reassign them to other roles at the company.
As a result, the casino operator’s daily operational expense would be likely to increase by HKD100,000 to HKD200,000 per day – from HKD21.8 million per day as of the second quarter, Lucror Analytics noted, citing management remarks in the latest earnings call. In consequence, SJM Holdings would explore “various means to reduce costs”, added Lucror Analytics.
Meanwhile, SJM Holdings would face “material refinancing needs” in fiscal year 2026, as the company has a number of tranches of senior notes maturing within that year, the credit research specialist noted.
“These comprise the US$500-million bond due in January 2026, as well as the HKD1.25-billion notes and MOP300-million notes due in May 2026,” stated Lucror Analytics, adding it thought risk in relation to refinancing was “low”.
“The company will likely seek new bank loans to refinance the USD500-million bond, according to management.
“Meanwhile, SJM has HKD3.1 billion of undrawn credit availability out of its HKD19 billion syndicated loan facilities, which could cover the maturing Hong Kong dollar and Macau pataca notes,” observed Lucror Analytics.
https://www.ggrasia.com/sjms-free-cash-flow-likely-negative-this-year-amid-pledged-casino-ops-acquisitions-will-need-fresh-financing-in-2026-lucror?utm_source=rss&utm_medium=rss&utm_campaign=sjms-free-cash-flow-likely-negative-this-year-amid-pledged-casino-ops-acquisitions-will-need-fresh-financing-in-2026-lucror
ab25
Macau casino operator SJM Holdings Ltd moved into first-quarter profit of HKD31 million (US$4.0 million), compared to a HKD74-million loss a year earlier.
That was on total net revenue that rose 8.1 percent year-on-year, to HKD7.48 billion.
Gaming net revenue went up 7.5 percent year-on-year, to nearly HKD6.95 billion.
The gaming performance was supported by a 41.1 percent year-on-year gain in gross gaming revenue (GGR) at the group’s Cotai resort, Grand Lisboa Palace (pictured), to nearly HKD1.57 billion.
The company – which is only required under Hong Kong Stock Exchange rules to make formal earnings reports on a six-monthly basis – released on Tuesday unaudited selected highlights from its trading for the three months to March 31.
A separate release on Tuesday cited SJM Holdings’ chairman, Daisy Ho Chiu Fung, as saying: “While the market experienced softer consumer spending in the first quarter, SJM Holdings’ performance remained steady on a sequential basis.”
She added: “The property enhancements undertaken throughout 2024 are now coming to fruition, with a pipeline of new offerings set to launch in phases – serving as growth levers for the mass market. Although the near-term macroeconomic outlook presents some headwinds, we remain focused on execution and confident in the long-term fundamentals of Macau’s tourism economy.”
Vitaly Umansky, senior analyst at Seaport Research Partners, wrote in a Tuesday note following the first-quarter highlights being issued: “SJM seems to be taking some market share in the lower end of base mass (especially the day tripper market) as other operators have been overly focused on premium play.
“In the short term this may benefit SJM, but we see other operators looking to expand base mass positioning in the next few quarters.”
SJM Holdings’ first-quarter adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) rose 10.9 percent year-on-year to HKD958 million.
During the period reported, the group’s GGR from rolling chip business, i.e., VIP play, was HKD641 million, a decrease of 0.6 percent year-on-year.
Mass-market table game GGR was HKD6.20 billion, up 8.6 percent year-on-year.
Electronic game GGR was HKD707 million, a 32.1-percent improvement.
https://www.ggrasia.com/grand-lisboa-palace-1q-ggr-up-41pct-y-o-y-as-promoter-sjm-holdings-records-modest-profit?utm_source=rss&utm_medium=rss&utm_campaign=grand-lisboa-palace-1q-ggr-up-41pct-y-o-y-as-promoter-sjm-holdings-records-modest-profit
mar25
Seaport Research has highlighted that, while SJM’s Grand Lisboa Palace (GLP) continues to ramp up operations, its return on investment remains disappointingly low and is unlikely to generate any positive value relative to the cost of investment in the near future, if at all.
This assessment follows the release of SJM’s 4Q24 results. Vitaly Umansky, senior analyst at Seaport, noted that the ramp-up at GLP is a critical driver for the stock to show positive momentum. Meanwhile, SJM’s strategy for GLP is still evolving. The company has been strengthening its sales and marketing team in recent quarters, which has led to increased costs.
http://agbrief.com/news/macau/06/03/2025/grand-lisboa-palace-growth-lags-unlikely-to-yield-positive-value-in-foreseeable-future-seaport/?utm_source=Asia+Gaming+Brief&utm_campaign=003b468a55-AGB%3A+%2302095+Thursday%2C+06th+March%2C+2025&utm_medium=email&utm_term=0_51950b5d21-003b468a55-%5BLIST_EMAIL_ID%5D&ct=t%28AGB%3A+%2302095+Thursday%2C+06th+March%2C+2025%29&goal=0_51950b5d21-003b468a55-%5BLIST_EMAIL_ID%5D&mc_cid=003b468a55&mc_eid=31e20475e6
mar25
The ramp up of business at the Grand Lisboa Palace resort in Cotai, run by Macau concessionaire SJM Holdings Ltd, has been slower than expected by investment analysts, but should continue as the company makes “targeted investments” to improve operations at the complex, say two separate brokerages.
CBRE Capital Advisors Inc suggested in a Wednesday memo that any closure of a satellite casino in Macau operated under SJM Holdings could eventually contribute to lift business volumes at Grand Lisboa Palace (pictured).
Satellite casinos operate under the gaming licence of a Macau concessionaire, but are usually promoted by third parties.
Under a new gaming regulatory framework – coinciding with the current 10-year concessions of the six Macau operators – third-party investors in satellite casinos will only be permitted to earn a “management fee” via a ‘management company’ from 2026.
Macau has 11 satellite casinos that continued to operate under the new 10-year gaming concessions that started in January 2023. Nine of the 11 satellite casinos are under SJM Holdings’ licence, one is under Galaxy Entertainment Group Ltd’s permit, and one is under Melco Resorts & Entertainment Ltd’s gaming rights.
https://www.ggrasia.com/grand-lisboa-palace-to-continue-to-ramp-up-any-satellite-casino-closure-could-help-biz-analysts?utm_source=rss&utm_medium=rss&utm_campaign=grand-lisboa-palace-to-continue-to-ramp-up-any-satellite-casino-closure-could-help-biz-analysts
mar25
SJM Holdings has reported net gaming revenue of HK$26.8 billion (US$3.45 billion/MOP27.5 billion) for the year ending December, up 33.8 per cent from the previous year.
According to an audited filing to the Hong Kong stock exchange on Tuesday, adjusted EBITDA jumped nearly 118 per cent to HK$3.76 billion.
Most importantly, SJM turned a profit of HK$3 million, a turnaround from the previous year’s loss of HK$2 billion.
In 2024, SJM accounted for about 13 per cent of the city’s gross gaming revenue, including 15.8 per cent of mass market table revenue and about 5 per cent of VIP revenue.
Cotai-based Grand Lisboa Palace Resort’s occupancy rate rose 14.4 per cent to 97 per cent for the whole year. The average room rate, meanwhile, fell by 9.9 per cent to HK$1,191.
https://www.macaubusiness.com/sjm-achieves-profit-turnaround-with-hk3-mln-gain/
may24
SJM Holdings has bought an older, three-storey building on Macao’s Avenida de Almeida Ribeiro – commonly known by its Cantonese name San Ma Lo – and plans to turn it into a mass market “food and beverage hotspot.”
The building, which currently functions as the Kam Pek Community Centre, was acquired for a sum of HK$166 million (US$21.2 million), according to a statement released by the concessionaire yesterday. The vendor was SJM’s parent company Sociedade de Turismo e Diversões de Macau, S.A. (STDM).
SJM says the refurbished community centre will serve “as a culinary anchor at one end” of the avenue, with the company’s “Grand Lisboa and Hotel Lisboa at the opposite end.”
https://macaonews.org/food-drink/macau-sjm-kam-pek-community-centre-food-dining-macao/
may24
Macau concessionaire SJM Holdings released its 1Q24 financial results on Thursday, with revenue and EBITDA improvements largely in line with expectations.
But one lingering concern remains the slow ramp of the company’s US$5 billion Cotai integrated resort Grand Lisboa Palace (GLP), with analysts becoming increasingly hesitant in touting its short-term growth prospects – particularly in regard to market share.
In a Friday note, investment bank JP Morgan said it is “not (yet) convinced that GLP can garner its target share of 5% in the coming years,” and has revised its earnings estimates accordingly.
Likewise, Vitaly Umansky of research house Seaport described the ramp-up of GLP as “tepid” at 2.0% market share in Q1, and noting that had it not been for high hold in VIP, share would likely have been 1.9%. He did, however, note comments from SJM management that market share may have approached 2.2% in April.
https://www.asgam.com/index.php/2024/05/10/analysts-not-convinced-sjms-grand-lisboa-palace-can-hit-5-market-share-target/
may24
SJM Holdings Limited’s (SJM) first quarter financial results showed slight improvements and met analyst expectations, but the slow ramp-up at Grand Lisboa Palace amidst a robust Macau recovery was worrying for the gaming operator, brokerage Seaport pointed out.
may24
Seaport Research Partners expects a sluggish ramp-up at SJM’s latest integrated resort project, Grand Lisboa Palace (GLP), with the long-term return on investment for the Cotai property to remain suboptimal.
In a recent report published following the release of SJM’s first-quarter results, the researcher expressed concerns regarding the slow pace of GLP’s ramp-up despite a strong recovery in Macau.
Analyst Vitaly Umansky noted that SJM’s first quarter results are slightly better than expected, but are largely driven by high VIP hold.
The analyst highlighted that GLP’s ramp-up was “critical for the stock to show positive uplift momentum”. However, the progress so far remained tepid, with GLP only achieving a 2 per cent market share.
https://www.macaubusiness.com/grand-lisboa-palace-shifts-to-premium-mass-marketing-amid-lacklustre-ramp-up/
mar24
A SJM Resorts vai organizar, a 30 de Março, um espectáculo de rock com Ayal Komod, cantor de Taiwan que interpretará trechos musicais populares do seu repertório no Grand Pavillon do Grand Lisboa Palace. A SJM lançou um pacote exclusivo que oferece bilhetes para o concerto e alojamento em hotel. Assim os hóspedes que jantarem nos restaurantes designados e fizerem compras nos pontos de venda do Grand Lisboa Palace e do Grand Lisboa durante o período promocional, terão a oportunidade de resgatar bilhetes para o concerto. O pacote de hotel exclusivo para o “SJM Ayal Komod Music Show” está disponível para reserva até 29 de Março. Inclui uma estadia de luxo no Grand Lisboa Palace ou no The Karl Lagerfeld na noite do concerto, pequeno-almoço para duas pessoas, crédito para refeições no valor de 500 patacas e dois bilhetes para o espectáculo. Além disso, de 13 a 28 deste mês, os clientes que jantarem em restaurantes designados ou fizerem compras nos pontos de venda da SJM e se registarem como membros do Cartão Supremo SJM, terão a possibilidade de obter até dois bilhetes gratuitos para concertos.
https://jtm.com.mo/local/ayal-komod-traz-rock-ao-grand-lisboa-palace/
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