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China – SJM outlines extent of COVID-19’s impact on first half revenues

By - 30 July 2020

The first half results of Macau casino operator Sociedade de Jogos de Macau were severely impacted by the COVID-19 outbreak, which led to closure of Macau casinos for 15 days in February, as well as ongoing restrictions on entry from the Mainland, Hong Kong and other locations, curtailment of transportation channels and quarantine requirements.

The group’s net gaming revenue decreased by 74.4 per cent, Adjusted EBITDA and profit attributable to owners of the company decreased by 147.3 per cent and 184.1 per cent, respectively, from the year-earlier period, whilst the group’s Adjusted EBITDA Margin decreased to negative 22.5 per cent from 12.2 per cent.

Mass market gross table gaming revenue decreased by 73.5 per cent and VIP gross gaming revenue showed a decrease of 81.6 per cent during the first half of 2020, compared with the year-earlier period.

During the same period, slot machine gross revenue decreased by 59.2 per cent compared with the year-earlier
period. SJM had a 15 per cent share of Macau’s gaming revenue, including 22 per cent of mass market table gross gaming revenue and 8.6 per cent of VIP gross gaming revenue. The Group maintained a strong financial position with cash, bank balances and pledged bank deposits of HK$7,511m as at 30 June 2020.

The Group’s flagship Casino Grand Lisboa decreased gross gaming revenue by 80.7 per cent, Adjusted Casino Grand Lisboa EBITDA and attributable profit decreased by 131.2 per cent and 141.4 per cent, respectively, as compared with the year-earlier period.

The occupancy rate of Hotel Grand Lisboa decreased by 75.9 per cent from the year-earlier period to 18.9 per cent. Average daily room rate increased during the period by 9.5 per cent to HK$1,628. Following completion of construction work on the Grand Lisboa Palace in late 2019, the Group began the
inspection and application process with the Macau Government. Subject to obtaining the necessary
operating permits, the project is expected to open by the end of 2020.

Dr. Ambrose So, Vice-Chairman and Chief Executive Officer of SJM Holdings Limited, said: “SJM’s first half results reflect the severe contraction in travel and tourism caused by the COVID-19 pandemic. In this environment, we strive to control our running costs at a prudent level. At the same time we are working closely with the Macau Government to complete the procedures to open our Grand Lisboa Palace resort on Cotai. We are confident that when the region emerges from the pandemic, SJM will be at
the forefront of Macau’s resumed development into a world centre of tourism and leisure.”

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