Galaxy Entertainment Group Ltd., a dominant force in Macau’s casino landscape, recently released its third quarter financial results for 2024, underscoring a robust recovery trajectory despite facing operational challenges. As of September 30, the company reported net revenues of HK$10.7 billion (approximately US$1.38 billion), reflecting an 11% year-on-year increase. This growth signals a strong rebound as the organization continues to navigate the post-pandemic landscape.
Earnings Amidst Unfavorable Luck
The company’s gross gaming revenue (GGR) increased to HK$10.2 billion (US$1.31 billion), representing a 16% rise from the previous year. However, the GGR did see a slight decline of 2% compared to the second quarter of 2024, indicating some volatility in the gaming performance. Breaking down the figures, the mass table win was recorded at HK$8.39 billion (US$1.08 billion), while the rolling chip win contributed HK$1.10 billion (US$141 million) and electronic gaming produced HK$666 million (US$86 million).
One noteworthy aspect was the adjusted EBITDA, which stood at HK$2.94 billion (US$378 million), marking a 6% increase year-on-year. However, it experienced a 7% decline from the previous quarter. Management noted that unfavorable luck negatively impacted EBITDA by approximately HK$165 million (US$21 million) during this period. Nevertheless, the adjusted EBITDA over the last 12 months demonstrated an impressive 68% growth, reaching HK$11.8 billion (US$1.52 billion).
Performance of Casino Properties
Among Galaxy Entertainment’s properties, Galaxy Macau continued to be the flagship establishment, achieving a GGR of HK$8.64 billion (US$1.11 billion), which is a 10% increase from the previous year. Moreover, the property recorded non-gaming revenue of HK$1.47 billion (US$189 million). Despite a slight year-on-year drop in adjusted EBITDA to HK$2.56 billion (US$329 million), it maintained a solid margin of 30%, slightly down from 34%.
StarWorld Macau also delivered promising results, showing a GGR increase both year-on-year and quarter-on-quarter. Additionally, Broadway Macau reported a staggering net revenue increase of 158% year-on-year, demonstrating that the overall portfolio is benefitting from both improved visitation rates and enhanced operational strategies. To further boost its offerings, Galaxy Entertainment is investing heavily in upgrades at StarWorld, focusing on the main gaming floor and lobby area, as well as expanding dining options.
Future Developments: Capella and Phase 4 Enhancements
In an ambitious bid to improve guest experiences and expand its portfolio, Galaxy Entertainment is advancing its Galaxy Macau Phase 4 developments. This expansion includes the highly anticipated Capella Hotel, set to open in mid-2025, featuring approximately 100 ultra-luxury sky villas and suites. The development is designed to enhance non-gaming attractions, emphasizing entertainment and family-friendly facilities, thereby diversifying revenue streams and enhancing customer engagement.
Strong Financial Health and Return to Shareholders
As of September 30, Galaxy Entertainment’s financial health remained robust, boasting HK$28.6 billion in cash and liquid investments. The company declared an interim dividend of HK$0.50 per share on October 25, signaling a commitment to returning value to shareholders amidst ongoing investments.
Chairman Lui Che Woo reiterated the company’s solid financial footing and operational cash flow, which facilitate significant capital returns to shareholders while enabling investments in both local and international strategies. As he aptly stated, “Our solid balance sheet and cash flow from operations allows us to return capital to shareholders through dividends, fund our development pipeline, and pursue our international expansion ambitions.”
Conclusion
The financial results of Galaxy Entertainment Group in the third quarter of 2024 demonstrate a promising ascent in net revenues and gross gaming figures, marking a significant recovery in the face of operating challenges. With ongoing developments and a strategic focus on enhancing offerings, the company appears poised for sustained growth. As Galaxy Entertainment continues to innovate and expand, both investors and stakeholders can anticipate a bright future ahead in the dynamic Macau casino landscape.
