internationalcasinoreview Business NEWS
Even with the opening of a major new resort in Galaxy World, GEG’s existing property StarWorld lost none of its shine. The company is well placed now to capitalise on the stellar growth of Macau.
stellarperformance GALAXY ENTERTAINMENT GROUP
With the opening of Galaxy Macau resort at the end of the period, parent company Galaxy Entertain- ment Group (GEG) saw an uplift in its revenues, however, its existing busi- nesses were also breaking records in the second quarter and the first half. Revenues in the first half totalled HK$13.67bn (E1.28bn), an increase of 60 per cent over the previous year: in the Q2, revenues were up 72 per cent to HK$7.9bn (E734.7m). All of GEG’s other business, includ- ing City Clubs and its Con- struction Materials Division, continued to perform solidly and made valuable contribu- tions to the group’s results. Adjusted net profit attrib-
utable to shareholders more than doubled to around HK$1.3bn (E120.9m) for six
months to the end of June after adjusting for a one-off charge of HK$800m (E74.4m) in pre-opening expenses for Galaxy Macau, a HK$200m (E18.6m) non- cash charge from the change in fair value of derivatives under convertible notes and a HK$100m (E9.3m) net loss on the buy-back of guaran- teed notes.
Galaxy Macau opened on
May 15 and in just 47 of oper- ation in the period gener- ated revenues of HK$2.4bn (E223.2m) and EBITDA of HK$376m (E35m). Rolling chip turnover at the VIP tables was $50bn (E4.65bn) generating a net win of $1.78bn (E165.5m) or 3.5 per cent. The mass-market tables saw turnover of $2.4bn (E223.2m), with rev- enues of HK$410m (E38.1m), a hold of 17.5 per cent, while slot machines saw a handle of HK$1.8bn (E167.4m) and a net win of
Strong Q3 boosts Shuffle Master
recordbreaking SHUFFLE MASTER
Shuffle Master has reported record net profits for the three months to the end of the July, up 56 per cent to $9.1m (E6.7m), off net revenues up 13 per cent to $58.3m (E42.7m). The revenue growth was helped in large part by a strong performance in its Electronic Gaming Machines division, which saw a 96 per cent year-on-year increase to around $18m (E13.2m) thanks to sales of around 800 units of the new Equinox cabinet. The company also saw 18 per cent growth in lease and service revenues in its Utility division: total revenues from Utility were up 14 per cent to $22.6m (E16.5m) because of increased lease
placements and an eight per cent uplift in average sales price.
In the Proprietary Tables
Games division, revenues from lease, royalty and service was up 11 per cent to a record $10.6m (E7.8m) from increased placements of premium games, side bets and progressives in the US and Singapore. However, total revenues from the division remained relatively flat at around $11m (E8m) due to fewer units being sold.
In the Electronic Tables Systems division, year-on- year total revenues were down 42 per cent to $6.8m (E5m) with lease, royalty and service revenue down nine per cent to $3.5m (E2.6m). They were affected by very strong sales in the prior year period and by the removal of Table Master seats in Pennsylvania and Delaware. Elsewhere in the business, the company managed to reduce its net debt by more than 31 per cent to $38.6m (E28.2m) compared to the end of October last year.
62 October 2011 • businessnews
Shuffle Master CEO Gavin Isaacs
In the year to date, total
net revenues were up 13.5 per cent to $160m (E117.1m) leading to a net profit for the nine months of $21.9m (E16m), up 25.9 per cent. CEO Gavin Isaacs said:
“We have positioned Shuffle Master to take advantage of significant opportunities across the globe providing an even stronger foundation for long-term, sustainable…growth.”
HK$114m (E10.6m). The resort opened on time
but was seven per cent over budget. Its full complement of 2,200 rooms will be open by the end of 2011, as will the entertainment complex including Macau’s first 3D Cineplex and the live enter- tainment and private club China Rouge. The resort’s older sibling,
StarWorld delivered a record- breaking performance in the half, with revenues of HK$10bn (E930m) up 37 per cent on the previous year. EBITDA in the period rose 53 per cent to $1.35bn (E125.6m). Turnover at StarWorld’s
VIP tables was up 34 per cent to HK$309bn (E28.74bn), with a hold of 2.9 per cent creating a net win of HK$8.9bn (E827.7m). Occu- pancy rate in the hotel was 97 per cent. Chairman of GEG Dr Che- woo Lui said: “The first half
Century grows in first half Century Casinos, with operations in Alberta, Colorado and on cruise ships, reported a 21 per cent increase in revenues in the first half to $35.1m (E25.7m) and it overturned the small net loss reported in H1/2010 to generate a net profit of $1m (E732,000). Erwin Haitzmann and Peter Hoetzinger, co-CEOs, said: “We are very pleased with our performance when considering that each of our operations posted increases in revenue as well as adjusted EBITDA. Overall earning from operations almost tripled.”
‘Exceptional’ results boost Galaxy Entertainment
Galaxy Macau, although open for only 47 days in the period, made a significant contribution to revenues and EBITDA
of 2011 has produced very strong results. I am delighted with the opening of Galaxy Macau and the exceptional results of StarWorld. Across each of our divisions, we have seen healthy growth and a positive contribution to the group.” He added: “Once again,
StarWorld outperformed the market. The opening of Galaxy Macau enhanced Star- World’s position and Star-
World posted a series of all- time records [delivering] one of the highest returns of any major casino in the world. Additionally, Star- World received numerous awards in the first half of the year, including the Five-Star Diamond Award, making it the most awarded hotel/casino in Macau.” Dr Lui concluded: “The
growth of the company shows no sign of slowing and
Floods affect Isle’s first quarter
dampenedexpectations ISLE OF CAPRI
The Mississippi floods in April and May had, as expected, a negative impact on Isle of Capri’s results in its first quarter with five casinos affected and more than 100 gaming days lost. Some of the venues are feeling the effects even now. The company saw its net
revenues for the three months to July 24 fall by 2.4 per cent compared to a year earlier to $245.8m (E179.9m) resulting in a net loss of $2.3m (E1.7m) - however, the bottom line nevertheless saw an improvement on the same period in 2010 when the net loss was almost $2.7m (E1.9m). President and CEO Vir- ginia McDowell com- mented: “This quarter clearly contains numerous outside factors that make it difficult to compare our progress to prior year. Flood- ing along the Mississippi River…impacted results at our properties in Daven-
port, Iowa; Caruthersville, Missouri; Lula, Natchez and Vicksburg, Mississippi. Each of these facilities was close for a minimum of six days and up to 41 days for our Natchez facility. In addition to the actual days closed, the properties did not operate at normal levels for some period of time before or after their respective closure due to conditions in the surrounding areas.” The company currently estimates the impact of the flooding on EBITDA to be greater than $7m (E5.1m). It hopes to be able to settle its
flood-related insurance claims within a year. However, at the proper- ties that were not affected, net revenues increased by 2.7 per cent, property EBITDA was up 6.5 per cent and EBITDA margins were up 70 basis points to 21.4 per cent.
the with the largest contigu- ous landbank in Cotai, GEG is well positioned to capi- talised on the growth of Macau.”
Isle of Capri’s casino at Natchez was closed for 41 days
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