H1: SJM Holdings posts 6.1% total revenue increase
SJM Holdings has posted strong revenue figures for H1, though EBITDA is down due to increased expenses and investment in acquisitions.
Key points:
– Total net revenue is up 6.1% year-on-year from HK$13.8bn (US$1.8bn) to HK$14.6bn
– EBITDA has taken a hit due to increase expenses and the acquisition of new property in July
– SJM Holdings has also announced the August acquisition of a property within Hotel Lisboa
Macau stalwart, SJM Holdings, has released its H1 financial results, exhibiting a 6.1% year-on-year increase in total net revenue.
The strong showing built on impressive Q1 results and has been driven significantly by a 5.7% uptick in net gaming revenue which stepped up from HK$12.9bn (US$1.7bn) to HK$13.6bn.
Adjusted EBITDA did not follow this positive trend, falling by 5.1% this year to HK$1.6bn.
This can be attributed to a notable increase in expenses and operational costs – some of these costs may prove worthwhile investments moving forward, however.
A July acquisition of 12 floors of office units near to Hengqin Port will be turned into a three-star hotel comprising 250 rooms within the next 24 months, all being well.
The expansion is intended to capitalise on Macau’s increasing tourist footfall by meeting the demand for mid-market accommodation and has cost SJM RMB 724m (US$101m).
In the same vein, though not covered by the interim financial report, is the agreed purchase from STDM of a property that forms part of Hotel Lisboa.
This deal was announced alongside the results and is set to complete in December 2025 – the new premises will be used to expand the current operations of Casino Lisboa by 7,504 square metres.
Good to know: Due to changes in regulation, SJM Holdings will have to cease operation of nine satellite casinos – one closure has already finalised with the others set to follow later this year
In H1 2025 SJM suffered a total comprehensive expense of HK$151.3m which was HK$36.9m more than it registered in the same period last year.
This time around, the company also took out more funds by way of bank loans repayable within a year – that figure shifted from HK$1.7bn to HK$3.4bn, increasing SJM’s debt burden.
Notably, SJM Holdings have managed to secure a significant investment through unsecured notes, meaning the investee has no obligation to personally repay the debt should the company collapse.
Last year, there was no such investment acquired, but this year, SJM has picked up HK$5.5bn in this manner.
Looking to the future and SJM Holdings has announced its plans to increase its involvement around tourist attractions and sporting events, particularly through the support of events including: the CTA Tour SJM Professional Finals in Macau, the National Tennis Championships, the SJM Macau Open and the Macau Grand Prix.
It is thought that engagement with these events could facilitate access to more “premium travellers.”
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