SJM net gaming revenue rockets 229.3% in FY23

Gross gaming revenue (GGR) rose by 228.5% to $21.20bn. This consisted of $17.87bn in non-rolling GGR, $1.55bn in rolling GGR as well as $1.77bn in electronic game GGR.

The NGR was the result of removing $1.14bn in commissions and incentives from the GGR. The NGR was generated by SJM Resorts, a subsidiary of SJM Holdings. It represented a 229.3% rise compared to full-year 2022, when the NGR was $6.0bn.

SJM Holdings experienced a difficult year in 2022, compounded by the closure of seven casinos in December 2022. These consisted of five “satellite” casinos – third-party promoted casinos – and two self-promoted casinos.

In its 2023 report, SJM noted that it operated nine satellite casinos as of 31 December 2023. These include Casino Casa Real, Casino Landmark, Casino Emperor Palace and Casino Grandview.

The year also represented the first full year of operation for SJM Resorts’ gaming concession contract, which took effect on 1 January 2023. The concessions were awarded by the Macau government in November 2022 and came about following the passage of a 2021 Macau gaming bill.

SJM Resorts was issued a concession alongside MGM Resorts International, Galaxy Entertainment, Las Vegas Sands, Melco Resorts and Wynn Resorts. Each concession runs for a period of 10 years.

Under “non-current assets” in its full-year report, SJM Holdings marked $2.29bn in gaming concession right.

Property revenue up and net loss diminishes

SJM’s Grand Lisboa Palace Resort generated $3.67bn in revenue for 2023, representing a 434.2% rise. Revenue at Grand Lisboa was $5.74bn for the year.

SJM combined its rundown of Jai Alai Hotel and Sofitel at Ponte 16, reporting $4.70bn in revenue. GGR from SJM’s satellite casinos was $8.64bn.

Overall net revenue – which consists of gaming, hotel, catering. retail, leasing and related services – was $21.62bn for the year, an increase of 223.7% yearly. SJM accounted for $8.48bn in special gaming tax and special levy, a notable increase compared to $2.68bn in 2022.

Income from hotel, catering, retail leasing and related services was $1.56bn for the year.

Turning to expenses, operating and administrative costs proved the highest, totalling at $8.82bn, up 4.2% yearly. Marketing and promotional expenses were $3.82bn, while finance costs hit $1.93bn.

After considering further costs, SJM’s pre-tax loss for the year was $1.83bn, a far cry from the $7.78bn loss recorded in 2022. Tax of $36.1m brought the loss for the year to $1.87bn, $5.97bn less than in 2022.

Adjusted EBITDA was $1.72bn for 2023, a marked improvement from the $3.09bn loss yearly.

Looking ahead to 2024

SJM noted that Macau’s preliminary visitation data for early 2024 indicates that recovery is set to continue for the special administrative region – “back to levels comparable to 2019, the last pre-pandemic year”.

The data showed that visitors for Lunar New Year worked out at a daily average of 169,725, 163% higher compared to 2022.

“Should these trends continue, the effects would be positive on SJM’s operations,” read the report.

The operator also referred to Macau’s overall 2023 GGR total, which was MOP180bn, as a “stipulated triggering event”. This, it said, caused SJM to “increase its non-gaming investment obligations by 20%, or MOP2.4bn, to a total of MOP14.4bn during the life of the gaming concession”.

Daisy Ho, chair of SJM Holdings Limited and managing director of SJM Resorts, said the company’s results, particularly revenue, represented a positive step in its recovery process.

“SJM Holdings’ results for 2023 show substantial recovery in gaming and non-gaming revenues from the pandemic years,” she said.