HONG KONG, Feb 25 — Macau hotel and casino giant SJM holdings, owned by Hong Kong tycoon Stanley Ho, said today its net profit for 2014 dropped 13 per cent as the gambling enclave struggles to stem a revenue decline.
Gaming revenue in the semi-autonomous Chinese city has fallen for eight consecutive months in the face of a corruption crackdown by the Beijing government, which is reining in big spenders from the mainland.
SJM’s woes were compounded when Alan Ho, executive director for the company’s Hotel Lisboa and the nephew of gaming tycoon Stanley Ho, was arrested as part of a prostitution ring bust in January which saw more than 100 people detained.
The company said its net profit for the calendar year fell 12.7 per cent year-on-year to HK$6.73 billion (RM3.12 billion).
SJM’s overall gaming revenue fell 8.8 percent to HK$79.27 billion—VIP gaming revenue dropped 17.26 per cent, while mass market table revenue was up 8.92 per cent.
Those figures reflected “the overall downturn in Macau gaming revenue”, SJM said in a statement.
Macau is the only part of China where casino gambling is legal and has depended on high-rollers from the mainland, now hit by Beijing’s anti-corruption drive.
SJM said 60 per cent of its gambling revenue came from VIP operations in 2014, down from 67 per cent in 2013.
“2014 proved to be a challenging time for Macau’s gaming industry, particularly the second half,” said its chief executive officer Ambrose So.
SJM said it continued to lead overall gaming market share in Macau at 23.2 per cent.
Official figures published by the former Portuguese colony showed that overall gaming revenues fell 17.4 per cent year-on-year to 23.75 billion patacas (RM10.7 billion) in January.
They had already plunged a record 30.5 per cent in December and fell 2.6 per cent overall in 2014, the first annual decline since figures were first released in 2002.
The slowdown has mostly been attributed to the high-profile corruption crackdown spearheaded by Chinese President Xi Jinping.
Xi’s visit in December saw him drive home the message that the territory needs to diversify away from casinos.
Dubbed the “King of Gambling”, Stanley Ho, 93, secured a monopoly on Macau’s casinos in the 1960s before licences were granted to rival firms including some major global players in 2002.
That led Macau to overtake Las Vegas as the world’s gambling capital.
SJM is planning to open a new resort, featuring three five-star hotels, a casino and entertainment facilities in 2017 on the Cotai Strip, a former swamp which is being transformed into mass-market resorts. — AFP
