Macau’s Galaxy Group posts Q4 earnings recovery and presses ahead with ICC plans

Macau-based gaming and hospitality holding company, Galaxy Entertainment Group (GEG) has reported its financial results for the three month and 12-month periods ended 31 December 2020, with net revenue down 75% from the previous year.  The Group, however, pointed to a Q4 recovery and said it was continuing with its long term development plans, including its Galaxy International Convention Center, part of the Cotai Phase 3 project. In 2020, visitor arrivals to Macau were 5.9 million, down 85% year-on-year. The GEG chairman, Dr Lui Che Woo’s statement in the annual accounts, released 25 February, noted that in Q4 2020, Mainland China, Hong Kong and Macau had continued to experience travel restrictions. “Given the subdued revenue, the Group’s Adjusted EBITDA was HK$1bn (US$130m) for the fourth quarter,” the chairman said. “This represents a 207% improvement compared to the Adjusted EBITDA loss of HK$0.9bn reported in Q3. This improvement was largely driven by an increase in visitation which translated into increased revenue and continuing cost control. The full year Adjusted EBITDA was HK$1bn versus HK$16.5bn in 2019.” By the end of 2020, the group held HK$46bn in cash and liquid investments with HK$9.2bn in total debt. “Due to our conservative financial management, the Group’s net cash as at year-end provides us with valuable flexibility in managing our ongoing operations and allows us to continue with our longer-term development plans,” Lui noted in the report. The chairman added the group continued to make good progress with its development projects including Cotai Phases 3 & 4. “Meanwhile, we renovate, reconfigure and introduce new products to our resorts. In addition, we remain engaged in our international expansion plans including Japan,” he added. The Cotai Phase 3 expansion will gradually open by the end of this year, with a HK$13.5bn construction granted already awarded for Phase 4. Phase 3 includes the Galaxy International Convention Center (GICC) and a 46,451sqm 16,000-seat multi-purpose Galaxy Arena. It will be directly connected to the future Hyatt Hotel Corporation 700 rooms Andaz Hotel. The GICC will also include 10,000sqm of pillar-less space that can accommodate up to 7,000 delegates, a banqueting area that can hold corporate dinners for up to 2,400 people, a grand ballroom for 1,000 guests, and a 650-seat auditorium.