Macau’s Galaxy Entertainment on a “Profit High” as Earnings Rise by 56%
Hong Kong-based casino Galaxy Entertainment Group Ltd closed in on a high last week. The company, which is one of the most popular casino and gaming services operators in Macau, has experienced a spectacular rise in profits by a staggering 56%.
Considering this phenomenal growth, the company is seeing a high investment rate from both national and international investors. To commemorate the roaring success, Galaxy Entertainment intends to issue a special dividend of HKD0.50 (US$0.064) per share for both existing and new shareholders.
According to Galaxy Entertainment Chairman, Lui Che Woo, the 56% rise in profits were calculated after making appropriate deductions for the interest, taxation, depreciation, and amortization (EBITDA) which amounted to HKD 4.3 billion. This rise in earnings has come as a surprise for the group, considering the stiff competition it has faced from the many new properties that have mushroomed in Macau since 2015.
Speaking of their competitors, Woo opens up about the how the 25% YOY growth in earnings is an indication that Galaxy Entertainment-operated casinos are still favored over other operators in Hong Kong. The company pegged its total gross gaming revenue (GGR) for the first half of the year at HKD34.3 billion (excluding earnings from venues operated by third-parties and earnings by City Clubs), which is a good 30% higher than what they earned last year.
As of today, Galaxy’s competitors have a sizeable market in Hong Kong. Recent quarterly and half-yearly financial reports indicate significant earnings. StarWorld Macau, another key player in the Hong Kong casino industry, has had a 41% YOY growth and Broadway Macau saw its EBITDA earnings reach HKD15 million.
But despite the rising competition, Chairman Woo remains optimistic about the future of the Galaxy Entertainment Group. The rising rate of tourism in Macau serves to be a good source of foreign earnings and investments for the group. The only thing that could negatively impact the company’s performance is the volatile fluctuations in currency value and the sluggish growth in global trade and economy as a whole.
The Chairman’s faith in the company’s future performance is, for now, good enough for the existing and potential investors. Additionally, Galaxy Entertainment’s 5% stake in the Monaco casino firm Société des Bains de Mer et du Cercle des Étrangers à Monaco, is proof of a bright future for their investments.