Macau casino operator Macau Legend Development has said that it will explore ways to continue managing two casinos despite the satellite agreement in place with SJM Holdings recently expiring.
The operator said: “If circumstances permit, the company will explore various options to continue the provision of management or any other forms of services related to the gaming operation at Babylon Casino and Legend Palace Casino after 31 December 2022 to the extent permitted by relevant laws and regulation of Macau and will maintain close contact with SJM in this regard.”
The Macau Government has recently proposed a bill to amend the existing gaming law in January 2022, which, if adopted and promulgated, will have a significant impact on the operation of satellite casinos. The existing concession contract entered into between the Macau Government and SJM (pursuant to which Landmark Casino, Babylon Casino and Legend Palace Casino are permitted to operate) expired on 26 June 2022, has been extended to 31 December 2022 in accordance with the applicable laws of Macau. In view of this, on 16 June 2022, Hong Hock entered into the Agreement for Provision of Services and Licensing for Occupation of Use of Spaces with respect to Babylon Casino; and Legend Palace Casino; and the Agreement for Provision of Services and Licensing for Occupation of Use of Spaces with respect to Landmark Casino, with SJM.
Macau Legend stated: “As a casino service provider, the operations of Hong Hock will be affected by the enactment of the Draft Bill. Further details of the Draft Bill and the relevant provisions are to be confirmed in order to assess the impact of the Draft Bill on Hong Hock’s operations. Nevertheless, over the past few decades, Macau’s satellite casinos (including ours) have undoubtedly made a significant contribution to the development of Macau’s economy and the creation of employment opportunities. As a provider of casino management services focused on mass market customers and satellite casinos, Hong Hock has a strong reputation and is well established in the gaming industry, proving that its casinos outperform some of the other satellite casinos. Hong Hock is committed to continuing to provide effective casino management services and will continue to focus on developing and identifying partnership opportunities, as well as contributing to the gaming industry in Macau within the constraints of the new law.”
For the year ended 31 December 2021, the Group achieved a total reported revenue of approximately HK$1,135.6m, representing an increase of approximately HK$434.9m or approximately 62.1 per cent over that of the last corresponding year of approximately HK$700.7m.
Gaming revenue of the Group increased by approximately HK$390.5m or approximately 74.1 per cent when compared to the last corresponding year. The increase in gaming revenue was primarily due to more visitors from mainland China under the better control of COVID-19 pandemic and more local consumption in Macau which caused increment in the reported revenue contributed from Legend Palace Casino of approximately HK$72.7m, increment in reported revenue contributed by Babylon Casino of approximately HK$29.8m, increment in reported revenue contributed by Landmark Casino of approximately HK$315.5m but decrement in reported revenue contributed by Savan Legend Casino of approximately HK$27.6m.
As at 31 December 2021, the group had a total of 194 gaming tables in Macau (31 December 2020: 194), of which 187 (31 December 2020: 185) (including electronic table games) were put into operation. The Group had 7 (31 December 2020: 8) gaming tables which were put into operation in the Lao PDR.
The operator added: “With the recent winding down of the Macau gaming intermediary operators and their related businesses, there has been a significant shift from the VIP segment to the mass market segment, a strategic positioning that Hong Hock has long been focused on. Despite the adverse influence under COVID-19 pandemic, the Group has been improving the existing operations in 2021. In Macau, the Group has focused on upgrading dining and entertainment offerings at MFW. Thakhek Club in Thakhek, Lao PDR (with 130 electronic gaming machines) and the hotel and casino at Savan Legend Resorts, Savannakhet will resume gradually when the Thai/ Laos border is reopened.”
“Looking ahead to second half of 2022, with increasing popularity of vaccines and gradual relaxation of travel restrictions by different governments in recent months, the group expects that the number of visitors coming to Macau will be increasing steadily in second half of this year. The group shall remain optimistic and well-equipped to seize opportunities for recovery when the tourism industry rebounds,” the operator added.