SJM revenue improves in H1 2021 but losses grow slightly

This was a rise of 19.3% compared to the same period in 2020, when casinos and gaming facilities were closed due to the novel coronavirus (Covid-19) pandemic.

Guangdong province lifted some of its most stringent Covid-19 measures in July last year, just before SJM’s H1 2020 results were released.

Gaming revenue made up HK$5.07bn of the total, a rise of 18.8% year on year.

Mass market table game operations made up a majority of the total, at $4.28bn. This was an increase of 33.2% compared to the first half of 2020. VIP gaming operations amounted to HK$855.6m, a sharp decline of 38.2% year on year.

Slot machine revenue made up HK$264m of the total gaming revenue, bringing it to HK$5.5bn. But commissions and incentives created an expense of HK$429.0m, leaving the total at HK$5.07bn.

However, special taxes on gaming, including levies and gaming premium costs, took HK$2.21bn of the revenue total, leaving net gaming revenue at HK$2.86bn.

While hotel, retail and other income added to the total to bring total revenue to HK$5.22bn, HK$4.53bn worth of expenses left SJM at an overall loss.

Operating and administrative expenses came to HK$3.84bn – this was a small rise of 2.1% compared to H1 2020.

Marketing and promotional expenses came to HK$618.3m, more than five times the amount attributed to marketing in H1 of 2020. Costs of sales amounted to HK$118.9m, while the remaining expenses consisted of finance costs worth HK$16.6m.

As a result, the operator’s total net loss came to HK$1.48bn, slightly more than it lost in 2020. Taxation of HK$10.4m left the overall loss for the period at HK$1.49bn, 1.3% more than 2020’s loss.

Gross gaming revenue in SJM’s flagship casino, Casino Grand Lisboa, increased by 9.7% year on year, amounting to HK$1.19bn.

Yesterday, it was announced that SJM’s newest venue, the Grand Lisboa Palace, was to begin a phased reopening in Macau.

Today, Macau’s government also announced a “state of immediate prevention” to limit spread of the novel coronavirus (Covid-19), after four residents tested positive for the virus.

The new rules mean that anyone wishing to leave the region must produce a negative Covid-19 test taken in the 24 hours before they depart.