Not surprisingly, SJM reports strong results.



“Our strong balance sheet provides a solid platform for the group to pursue its strategy of growing our mass market and VIP businesses. In addition to our flagship casinos Grand Lisboa and Lisboa, the restructured third party-promoted casinos are contributing nicely to the revenue and earnings of the group and our newest casino Oceanus is ramping up to meet our expectations.  We expect that the year 2010 will be a rewarding one."


--Ambrose So, CEO of SJM Holdings



  • SJM grew faster than market in 2Q
  • Oceanus performing close to expectations
  • Will expand Portuguese school site, which SJM is pursuing


  • Grand Lisboa results--2Q driven by volume, not hold.
  • Satellite casinos margin decrease QoQ
    • Lower margin because of better volume from VIP business, which has lower margin
  • Provision for losses attributable to junket is the lowest in the industry
  • Oceanus walkway has support from government authorities  
  • Grand Lisboa 32 tables--migration from other properties, not new tables
  • Mr. Fok appointment-- contribution to cultural and non-gaming activities
  • Interim dividend: more cautious.... Full-year 2010 dividend will continue 50% payout policy
  • Capex YTD: $305 MM; $500MM-600MM for 2nd half of 2010, used for Oceanus, Grand Lisboa, and Ponte 16; for 2011, less than 2010 until movement on Cotai
  • Cotai: negotiating one of the plots with adjacent owner; hopefully, will be settled by 1Q 2011. No land premium has been paid, still waiting for land grant from Government.
  • Expecting some pressure on labor costs with new products coming online on Cotai
    • Some promotions and then backfill those positions; may see up to 10% rise in labor costs
    • Will have a retention plan in 4Q 2010
    • For 2Q 2010, 8.1% YoY increase in labor costs
  • 3rd party casinos
    • VIP business least susceptible to downturn
    • 3-5% revenue share contracts--3-4 year contracts
    • If in a downturn, they will close down tables and give them to SJM, which it can use for expansion purposes
  • Dr. Ho is recovering well

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