The challenges of the second quarter of the Galaxy Entertainment Group continued throughout the year as the group again points to innovations and changes as heavy Macau headwinds affect the latest financial statement of the company.
During the third quarter of 2019, sales decreased by two percent year-on-year to HK$12.7bn (US$ 1.62bn), driven by numerous Macau-based impacts including ongoing trade tensions, a declining global economy, local competition, currency fluctuations, and Hong Kong disturbances.
In the latest update, GEG lauded ongoing development activities across Japan, stressing that the country represents “a great long term growth opportunity that will complement our Macau operations and our other international expansion ambitions”.
The company continues to improve its development team in Japan and remains confident about participating in the integrated resort process, as the company is also moving forward with its design plan for a luxury resort on Hengqin to “complement our high energy resorts in Macau.”
The hotel and casino operator has also advanced its $1.5 billion expansion plan for its entities in Galaxy Macau and StarWorld Macau, claiming that it is “uniquely positioned for long term growth”.
Lui Che Woo, chairman of GEG, said of the ongoing work: “We continue to progress with our $1.5 billion property enhancement program at Galaxy Macau and StarWorld Macau, the program continues on schedule and on budget. We are pleased to have recently completed the renovation of two VIP rooms which have been well received by our customers.
“We will continue to enhance our resorts and anticipate the full program will be completed by mid-2020. Furthermore, we continue our construction works of Cotai Phases 3 and 4 and continue to refine our development plans for a lifestyle resort in Hengqin.
“Regarding our expansion efforts in Japan, we continue to strengthen our Japan development team and build our resources as we move forward in the integrated resort process.”
GEG’s Galaxy Macau subsidiary continues to dominate the property portfolio, with sales remaining flat year-on-year at HK9.3bn (US$ 1.19bn).
StarWorld Macau fell to HK$2.5bn (US$ 319 m) by 14 percent, while Broadway Macau dropped to HK$141 m ($18 m).
“I am pleased to report the third quarter results for the group in 2019,” Lui Che Woo added. “Given the overall market conditions and weaker global consumer sentiment we believe the group has delivered solid financial results.
“Macau has faced numerous headwinds in 2019, these includes ongoing trade tensions, a slowing global economy, regional competition, currency fluctuation, disruptions in Hong Kong among others. These events have been impacting consumer sentiment and subsequent spending habits.”