SJM Q3 net profit rises 10.3 percent

2013-11-12

From：Macau Daily Times

SJM Holdings Ltd., Asia’s biggest casino company by revenue, posted third-quarter earnings that missed analyst estimates as it faces rising competition in Macau.
Adjusted earnings before interest, taxes, depreciation and amortization, or Ebitda, rose 8 percent to HKD2.04 billion in the three months to September, it said in a filing to Hong Kong’s stock exchange yesterday. That missed an average estimate of HKD2.11 billion from 10 analysts compiled by Bloomberg.
SJM, founded by Hong Kong tycoon Stanley Ho, faces rising competition as rivals including Sands China Ltd. and Galaxy Entertainment Group Ltd. have added shops and entertainment shows at their Cotai resorts.
Net profit climbed 10.3 percent to HKD1.83 billion during the third quarter from a year earlier, while gaming revenue rose 11 percent to HKD21.1 billion.
SJM shares lost 1.2 percent to close at HKD25.4. The stock has risen 41 percent this year, outperforming the benchmark Hang Seng Index’s 1.8 percent gain.
The operator said in September that it will spend HKD25 billion to build its first Cotai resort that features as many as 700 gambling tables, and a luxury hotel in partnership with Italian fashion house Gianni Versace SpA.
“Constrained by capacity and product competitiveness, SJM’s growth may not be as strong as that of peers for the next three years,” said DS Kim, a Hong Kong-based analyst at BNP Paribas in a research note ahead of the results.
SJM runs 20 out of the 35 local casinos in Macau and Ho’s four-decade monopoly in. SJM accounted for 24.3 percent of the city’s casino gaming market in the third quarter, compared with 26.1 percent a year ago.
SJM’s gambling revenue from VIPs, or high rollers rose 8.8 percent in the third quarter, while mass market revenue climbed 18.2 percent, it said.
Gambling revenue in the former Portuguese enclave increased 18 percent to 297.1 billion patacas in the first 10 months of this year, close to the USD38 billion revenue raked in last year. High-stake gamblers contributed about two thirds of the city’s revenue last year.

Copyright@Macau Daily Times