Galaxy Entertainment reports net revenue of HKD7 bln in Q1, phase 3 to boost future development

Galaxy Entertainment Group reported on Monday that its net revenue for the first quarter of 2023 was HKD7.05 billion (MOP7.26 billion/US$900 million), a quarter-on-quarter increase of 142 percent. The adjusted EBITDA for the quarter was HKD1.91 billion, reversing the negative figure of HKD163 million reported in the previous quarter.

According to a stock filing sent to Hong Kong’s stock exchange, the group’s gross gaming revenue for the first three months was HKD6.07 billion, up 79 percent year-on-year, and mass gross gaming revenue was HKD4.93 billion, up 86 percent year-on-year.

The upside came from strong opex control and solid mass performance, and the group’s flagship Galaxy Macau was “a standout performer” with a 61 percent recovery in EBITDA that helped it “retain the title of Macau’s most lucrative casino” in the first quarter of the year, J.P. Morgan analysts DS Kim and Mufan Shi noted in a Monday update.

The gaming operator also had ample liquidity, with cash and liquid investments of HKD28.7 billion and net cash of HKD21.3 billion as of the first quarter of this year.

“It has been very pleasing to see solid pent-up customer demand following the relaxation of travel restrictions. Visitor arrivals, hotel occupancy, gaming revenue, and retail sales have all seen good growth,” said the chairman of the company, Lui Che Woo, in the filing.

In the second quarter, the group expects to see “further improvements” as more facilities come online, including the Galaxy International Convention Center (GICC),  Raffles at Galaxy Macau, and Andaz Macau.

“The reopening after Covid-19 and Phase 3 expansion will generate 900 new jobs for locals,” the chairman stated.

The MICE facilities of the group’s Phase 3 project have been trial running. The Galaxy Arena and GICC have hosted multiple shows and events, including a concert by K-pop girl band Blackpink over the past weekend.

The Raffles and Andaz hotels covered by the Phase 3 development are scheduled to open later this year, and the gaming operator is recruiting additional staff in preparation for the launch.

The group is also developing its Cotai Phase 4 project, which has a strong focus on non-gaming elements, primarily targeting MICE activities, entertainment, family facilities, while also including gaming.

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