SJM Holdings has reported an impressive set of financial results for the third quarter and first nine months of 2024, showcasing substantial growth and recovery across its diverse portfolio of properties. This demonstrates the group’s strategic focus on operational efficiency, cost management, and leveraging its flagship properties to drive sustainable growth. 

SJM Holdings Announces Strong Financial Performance in Q3 and First Nine Months of 2024

Q3 2024: Robust Revenue Growth and Improved Profitability

During the third quarter of 2024, SJM Holdings achieved a significant 27.8% year-on-year increase in total net revenue, which amounted to HK$7.5 billion (equivalent to approximately $964 million). This growth was primarily driven by the group’s core business segment, net gaming revenue, which increased by 29.2% to reach HK$7 billion. The rise in gaming revenue is attributed to substantial growth across the rolling, non-rolling, and electronic gaming segments.

Exceptional Adjusted EBITDA Performance

A key highlight of Q3 2024 was the significant improvement in adjusted EBITDA, which surged by an impressive 83.2% year-on-year to HK$1.04 billion. This growth reflects the group’s focus on cost management and operational efficiency, resulting in an adjusted EBITDA margin expansion from 9.6% in Q3 2023 to 13.8% in Q3 2024.

The increase in profitability is a testament to SJM Holdings’ strategic initiatives aimed at optimizing its operations, thereby enhancing shareholder value and maintaining a strong financial foundation.

Strong Performance of Key Properties: Grand Lisboa Palace and Grand Lisboa

Grand Lisboa Palace Resort: A Significant Growth Driver

One of the standout performers in Q3 was the Grand Lisboa Palace Resort, which reported a 63.9% year-on-year increase in total revenue to HK$1.78 billion. This surge in revenue was driven by a balanced mix of growth in both gaming and non-gaming segments. Notably, the resort’s adjusted property EBITDA turned positive, reaching HK$165 million, compared to a loss of HK$27 million in the corresponding quarter of 2023.

The Grand Lisboa Palace continues to be a significant growth engine for SJM Holdings, leveraging its comprehensive offerings to attract a diverse customer base and maximize revenue streams.

Grand Lisboa Casino: Solid and Resilient Growth

The Grand Lisboa Casino also delivered robust results, with total revenue increasing by 30.3% year-on-year to HK$2.02 billion. The property’s adjusted property EBITDA grew by 46.1% to HK$545 million, showcasing its resilience and strong demand for both gaming and non-gaming offerings.

Nine-Month Financial Overview: Sustained Growth Momentum

For the first nine months of 2024, SJM Holdings reported a 39.9% year-on-year increase in total net revenue, which amounted to HK$21.3 billion. Meanwhile, net gaming revenue rose by 41.0% to HK$19.89 billion, indicating a steady recovery in the gaming sector post-pandemic.

Impressive EBITDA Growth

Over the same nine-month period, the group’s adjusted EBITDA more than doubled, increasing by a remarkable 169.8% to reach HK$2.78 billion. The adjusted EBITDA margin also expanded significantly, rising from 6.7% to 13.0%. This underscores the group’s focus on improving operational efficiency and profitability across all its properties.

Additional Revenue Contributions from Other Properties and Segments

Beyond its flagship properties, SJM Holdings’ other self-promoted casinos, such as Jai Alai Hotel and Sofitel at Ponte 16, contributed positively to the group’s overall performance. In the third quarter, these properties saw a 16.1% year-on-year increase in total revenue to HK$1.46 billion.

The satellite casinos segment also experienced a strong recovery, with casino revenue growing by 19.7% compared to the previous year. This growth demonstrates SJM Holdings’ commitment to optimizing its existing portfolio and capitalizing on market recovery.

Capital Expenditure and Investment Strategies

During the third quarter of 2024, the group incurred capital expenditures of HK$166 million, primarily directed towards furniture, fixtures, equipment, and leasehold improvements. These investments are part of SJM Holdings’ strategy to enhance the guest experience and maintain the quality of its properties.

However, the group reported an unrealized fair value loss of HK$16 million in its investment in equity securities, which had a minor impact on overall financial performance. Despite this, SJM Holdings maintains a solid balance sheet with a focus on long-term growth.

CEO’s Perspective on Q3 Performance and Future Outlook

Reflecting on the positive results, SJM Holdings’ management emphasized the group’s strategic focus on maximizing revenue through effective cost control and leveraging its diversified property portfolio. The successful performance of Grand Lisboa Palace Resort and Grand Lisboa highlights the company’s ability to capture market opportunities and navigate economic challenges.

SJM Holdings aims to continue this momentum by exploring new growth initiatives and expanding its market presence in the gaming and hospitality sectors. The focus remains on optimizing operational efficiencies, maintaining robust cash flows, and exploring strategic investments to drive sustainable growth in the coming years.

Conclusion: A Promising Outlook 

With strong financial results and a positive outlook for the remainder of 2024, SJM Holdings is well-positioned to capitalize on its strategic investments and portfolio expansions. The group’s focus on operational efficiency, disciplined cost management, and leveraging its flagship properties sets a solid foundation for sustained growth in the highly competitive gaming industry.

FAQs About SJM Holdings’ Financial Results in Q3 2024

1. What were the key financial results for SJM Holdings in Q3 2024?

SJM Holdings reported a strong financial performance in Q3 2024, with total net revenue increasing by 27.8% year-on-year to HK$7.5 billion ($964 million). Net gaming revenue, which forms the bulk of its income, rose by 29.2% to HK$7 billion.

2. How did SJM Holdings’ adjusted EBITDA perform in Q3 2024?

Adjusted EBITDA for Q3 2024 surged by 83.2% year-on-year, reaching HK$1.04 billion. The adjusted EBITDA margin also improved, expanding from 9.6% to 13.8%. This growth reflects the company’s focus on cost management and operational efficiencies.

3. Which properties contributed most significantly to the growth?

The flagship properties, Grand Lisboa Palace Resort and Grand Lisboa, were significant contributors. Grand Lisboa Palace saw a 63.9% increase in total revenue to HK$1.78 billion, while Grand Lisboa’s revenue grew by 30.3% to HK$2.02 billion.

4. What were the financial results for the first nine months of 2024?

For the first nine months of 2024, SJM Holdings’ total net revenue increased by 39.9% to HK$21.3 billion, with net gaming revenue growing by 41.0% to HK$19.89 billion. Adjusted EBITDA more than doubled, rising by 169.8% to HK$2.78 billion, with the margin improving from 6.7% to 13.0%.

5. What was the performance of the Grand Lisboa Palace Resort in Q3 2024?

Grand Lisboa Palace reported strong growth with total revenue increasing by 63.9% to HK$1.78 billion. The property’s adjusted EBITDA turned positive at HK$165 million, compared to a loss of HK$27 million in Q3 2023.

6. How did the satellite casinos and other properties perform?

The other self-promoted casinos, such as Jai Alai Hotel and Sofitel at Ponte 16, saw a 16.1% increase in total revenue, totaling HK$1.46 billion. Additionally, the satellite casinos segment showed a recovery with a 19.7% growth in revenue year-on-year.

7. What were the company’s capital expenditures during Q3 2024?

In Q3 2024, SJM Holdings’ capital expenditures amounted to HK$166 million, mainly for furniture, fixtures, equipment, and leasehold improvements.

8. Did SJM Holdings face any challenges during this quarter?

Despite the strong operational performance, the company faced an unrealized fair value loss of HK$16 million in its equity investments during Q3 2024.

9. What did SJM Holdings’ management say about the future outlook?

The management emphasized their focus on cost control, leveraging flagship properties, and optimizing operations for sustainable growth. They are committed to exploring new growth initiatives and strategic investments to maintain strong financial performance.

10. What are the company’s plans moving forward?

SJM Holdings aims to continue driving revenue growth through strategic investments in its properties, exploring market opportunities, and enhancing customer engagement while maintaining robust cash flows to support long-term growth.