Galaxy Entertainment Group (GEG) Ltd registered a 31% increase, quarter to quarter, in the adjusted earnings before interest, taxation, depreciation and amortization (EBITDA) in the third quarter of 2020 (Q3), largely attributed to the resort group’s heightened undertakings on cost control.
The group posted a negative EBITDA of HKD943 million in Q3 2020, up from the EBITDA loss of HKD1,370 million in the preceding quarter, according to the latest financial report filed by GEG.
Since the outbreak of the Covid-19, casino operators in Macau have grappled with the economic fallout of a plunge in visitor arrivals.
GEG is no exception, with its adjusted EBITDA tumbling from the previous positive value of HKD4,112 million in Q3 2019 to a negative earning in the same period this year.
In a letter in response to the Group’s financial data, Lui Che Woo, chairman and founder of Galaxy Entertainment, associated the loss with “subdued revenue and ongoing staff costs.”
The reinstatement of the Individual Visit Scheme (IVS) – which allows all mainland residents to visit Macau since September 23 – has been a lifeline thrown to the city’s tourism industry.
However, most mainland cities resumed IVS applications only in late September. Hence, “visitation was not materially impacted in Q3 which will hopefully continue to ramp up in Q4,” said Lui.
In Q3 2020, a total of 750,204 visitor arrivals to Macau were registered. Among all, close to 91%, or 679,773, were mainland tourists, up from 46,360 in Q2 2020.
GEG said it has capitalized on the downtime to renovate and reconfigure the resorts, and roll out new offerings to remain competitive in the market.
The Group also mentioned in the filing that the timeframe for the ongoing third and fourth development phases of Cotai – with a focus centered on non-gaming, mainly targeting MICE, entertainment, and family facilities – may be impacted.
The opening of phase 3 of Galaxy Macau at Cotai, comprising a luxury hotel tower, an Andaz-branded hotel and a conference center, was originally slated for mid-2021. Staff reporter
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