Galaxy Entertainment Group (GEG) reported “solid” performance in the third quarter. The Macau concessionaire saw net revenues rise 11% year on year, against a quarterly drop of 2%.
From July through September, GEG recorded net revenues of HK$10.7 billion (£1.066billion/€1.283 billion/$1.38 billion), up 11% year-on-year, but down 2% from the previous quarter.
Adjusted earnings before interest taxes, depreciation and amortisation (EBITDA) rose 6% from Q3 2023 to HK$2.9 billion (US$373 million), but “played unlucky” quarter-on-quarter, down 7%.
In a statement, Galaxy chairman Lui Che Woo said the balance sheet is “healthy and liquid” and positions GEG to “pursue international expansion” as well as local growth.
GEG is working to complete Phase 4 of development at Galaxy Macau, an ambitious undertaking spanning 600,000 square metres. The $HK43 billion project will add several luxury hotel brands along with a 4,000-seat theatre, a water resort deck and a new casino. The lavish Capella at Galaxy Macau will open in 2025.
On 25 October 2024, the Hong Kong-listed firm paid an interim dividend of HK$0.50 per share.
Golden Week a good harbinger
Lui pointed to robust Golden Week visitation in Macau as a strong fourth-quarter predictor. The Chinese gaming hub welcomed a total of 993,117 visitors during the seven-day holiday, with daily average arrivals at nearly 102% of pre-pandemic levels. “Macau hotels’ average guestroom occupancy stood at 95% during the period,” GEG noted.
According to a breakdown by Macao News, net revenue by property was HK$8.4 billion for Galaxy Macau; HK$1.3 billion for StarWorld Macau and HK$62 million for Broadway Macau. Occupancy at Galaxy Macau’s seven hotels was 98% from July through September, versus the citywide average of 95%.
In keeping with the city’s drive to grow international tourism, GEG has opened a new “overseas business development” office in Bangkok. It has similar offices in Tokyo and Seoul.
Poised for growth
Seaport Research Partners analyst Vitaly Umansky agreed that GEG opened strong in the fourth quarter. According to Macau Business, he added that the surge may level off in November and December.
However, Umansky said the company’s “competitive advantage… is its entertainment/event offerings, scale, service and product offering. Large music performances drive outsized business with the fourth-quarter schedule supporting Galaxy Macau share gains.” Galaxy Arena at the Cotai resort is the city’s largest indoor entertainment space, with a 16,000-seat capacity.
“With a re-focused marketing effort and smart digital tables up and running before Chinese New Year,” Umansky added, “we expect share gains to continue at Galaxy Macau over the next few quarters and into 2025.”
