GEG confident in new concession, reports 40% revenue drop in Q2

Galaxy Entertainment Group (GEG) recorded a net revenue of HKD2.4 billion in the second quarter, down 56% year-on-year and down 41% quarter-on-quarter.

According to its second quarter financial report, the gaming operator posted a net revenue of HKD6.5 billion, down 39% year-on-year in the first half of the year.

The plunge in revenue is attributed to the city’s reduced tourism activity during the second quarter of the year, where a number of cities across China experienced travel restrictions.

For GEG, these restrictions on inter-provincial travel impacted visitation to Macau, and in turn adversely impacted both revenue and profitability. 

Meanwhile, Group Adjusted EBITDA was -HKD0.4 billion, versus HKD1.1 billion in Q2 2021 and HKD0.6 billion in Q1 2022. 

“Our balance sheet remains liquid and healthy. As of 30 June 2022, cash and liquid investments were HKD29 billion and net cash was HKD20.3 billion,” said Lui Che Woo in the financial report. 

“Given the ongoing impact of Covid, today the Board of Directors has decided not to declare a dividend. We paid the previously announced special dividend of HKD0.30 per share on 29 April 2022,” he added. 

Meanwhile, the GEG chairman is confident in its proposal bids regarding the tendering process for gaming concessions that was officially announced July 22 and due by September 14.

“We are well positioned to compete for one of the Macau’s gaming concessions, given our track record of introducing innovative non-gaming elements into our resorts, our strong operational history, significant investment into Macau’s economy and our substantial CSR efforts, including supporting SMEs,” said Lui. 

Figures from the Gaming Inspection, and Coordination Bureau show the city’s gross gaming revenue for the second quarter has plunged to HKD8.2 billion, down 67% year-on-year and down 52% quarter-on-quarter.