Group Rev of $12.3 billion, up 5% QoQ but down 29% YoY
Adj EBITDA of $2.1 billion, UP 13% QoQ but down 36% YoY
- Adjusted EBITDA of $1.7 billion, down 30% YoY, up 19% QoQ
- Played unlucky in Q3 which reduced Adjusted EBITDA by approximately $117 million
- Hotel occupancy across the five hotels was 99%, Non-gaming revenue of $742 million, up 92% YoY and 60% QoQ
- VIP Win % = 3.6% in Q3 2015 vs 3.2% in Q3 2014
- Mass Hold % = 43% in Q3 2015 vs 44.9% in Q3 2014
- Adjusted EBITDA of HK$514 million, down 43% YoY, up 1% QoQ
- Played unlucky in Q3 which reduced Adjusted EBITDA by approximately HK$11 million
- Hotel occupancy was 99%
- VIP Win % = 2.7% in Q3 2015 vs 2.9% in Q3 2014
- Mass Hold % = 40.3% in Q3 2015 vs 41.4% in Q3 2014
- Virtually broke even with Adjusted EBITDA of HK$(1) million
- Played unlucky in Q3 which reduced Adjusted EBITDA by approximately HK$3 million
- Hotel occupancy was 99%
- Mass Hold % = 25.1% in Q3 2015 vs 20.7% in Q2 2015
Development cost savings of HK$400-HK$500 for Phase 2
Issuing a special dividend of HK$0.14 per share
Mass and non gaming - growing relative to VIP, despite still being the market leader in VIP
Will be realizing a HK$800 million cost savings program, and so far is on pace to deliver this initiative.
Cost savings program was previously underway, but are just now quantifying the program.
Hotel OCC continues to grow. Up to 99% from 96% over the same period last year
Bad luck hurt virtually all properties, luck on mass side was slightly better than the prior year period
Starworld Mass business growing very nicely
Phase 2 Update - Invested a total of $15.7 billion thus far on the project
Finished their strategic investment in Monaco's SBM (casino monopoly in Monte Carlo)
They remain cautiously optimistic regarding the future of Macau
Cite that a growing consumer in China will aid the growth of Macau
Anticipate to re-capture lost players when growth resumes
Flexible balance sheet is a huge positive going forward and will allow Galaxy additional opportunities
- Cost savings? Where will the costs be taking out?
- HK$800 million in savings and they have done about 35% of that thus far. Should be a 12-18 month program.
- Labor, marketing, and procurement will take up the largest share of the savings
- Shuffling around their human resources more effectively
- Looking into strategic marketing initiatives - wouldn't specify
- China/Macau Government comments
- Confident in the government's ability to support the industry and economy. See their willingness to work with the operators. Recent steps are a real positive
- Constantly looking to re-allocate their tables to Mass and premium Mass
- Revenue mix is really beginning to shift from VIP to mass, non gaming and slots. Represents roughly 50% of revenue now
- Cited strong Golden Week as a positive sign for the future.
- Opening of Horizon their premium mass offering has been very successful and will look to continue to use that as a future driver
- Table allocations. Awarded another 100 tables?
- They are in further talks with the government, but haven't received confirmation for the additional tables
- Tables are reportedly under utilized, how will they help?
- Would offer flexibility to allocate more tables to effective areas of the casino.
- It is also another sign of support from the government
- Will apply the tables to their highest and best use, (likely to premium mass segment)
- Couldn't comment on Phase 2's specific contribution to EBITDA but said it was very accretive
- Non Gaming was so strong due to Phase 2 and they are very pleased with this segment.
- Non Gaming Margin = Very high (wouldn't give exact numbers)
- SSS growth looking strong in their retail segment.
- 60k foot traffic per day for phase 2 was the whisper number, is that still holding?
- Still north of 60k per day, but they are also attracting better customers and Horizon will continue to drive that number higher
- Phase 3 or 4 changes to CAPEX?
- Studying diligently, focusing on consumer and forecasting where the consumer will be.
- CAPEX allocation is subject to change but for now, they haven't made changes
- Retail area not open until end of july, should we see more of an uptick since they weren't open for the full Q?
- Yes, expect to open more stores which will add to the non gaming number.
- They are very bullish on the potential of their retail segment