Grand Emperor Hotel Profit Rises 485%!

Written on January 6, 2007 by admin

Emperor International Holdings & Emperor Entertainment Hotel Announce 2006/2007 Interim Results.

We are only showing the details related to Macau, for full story check the link below the article.

We are seeing some interesting numbers here, the VIP numbers are indeed impressive, but the mass-market average is lower!

Emperor Entertainment Hotel Limited
– Turnover rose 778% to HK$593 million
– Profit rose 485% to HK$109 million
– Mass-market table win per day up 20% to HK$28,000
– VIP table gross win per day up 17% to HK$676,000
– Interim dividend of 4 HK cents
– Room for expand operations

Turnover soared by more than seven times to approximately HK$593.3 million during the Review Period (2005: HK$67.6 million). Profit attributable to shareholders rose 485.2% to approximately HK$109.2 million (2005: HK$18.7 million). The surge in turnover and profit was mainly attributable to contributions from the Group’s flagship project, Grand Emperor Hotel in the Macau Special Administrative Region.

The Grand Emperor Hotel in Macau is the flagship of this segment. The hotel officially commenced business in January 2006, and was the first new hotel in Macau in the year, in line with the Group’s strategy to get in early in the fast growing and lucrative market. The Review Period marked the first period to record a full six-month operation of the hotel as a full-scale entertainment facility. The result showed positive contributions from all segments.

The Grand Emperor Hotel is located at the heart of Macau’s city centre, a short distance from the main ferry terminal and the casino landmark Hotel Lisboa. Targeting medium to high rollers, the Grand Emperor Hotel has 136,660 square feet of gaming space spread across seven floors. It offers 348 slot machine seats and approximately 90 gaming tables in a gaming concourse and VIP rooms, featuring mainly baccarat — the most popular table game in Macau.

The Group owns 45% of the project. With management control vesting in the Group and other stakeholders remaining passive investors, the project’s financials are consolidated into the Group’s balance sheet in order to provide transparency for the market and investors. Since the commencement of business in January 2006, the hotel has quickly established its brand-name in Macau, the world’s second largest gaming market. Despite keen industry competition with the arrival of several new players in the market, the project recorded turnover of approximately HK$532.1 million (2005: Nil), and profit reached approximately HK$210.1 million, compared with a loss of HK$10.6 million
previously. The hotel building recorded a revaluation gain of HK$123.1 million (2005: HK$20.4 million).

Gaming Revenue

Despite growing market competition, the Group’s casino operations, provided by licence holder Sociedade de Jogos de Macau (”SJM”), performed in line with management expectations. All segments picked up quickly since the project launched in January 2006. Management expects continual improvement in its results when the hotel further expands its operations.

Gaming Concourse

During the Period, the Group had increased the number of tables in operation in the mass market-targeted concourse to 48 tables from 44 tables as reported in the latest annual report. These tables resulted in a gross win of approximately HK$235.9 million, with an average win of approximately HK$28,000 per table per day, up from approximately HK$23,000 as reported in the latest annual report. Revenue for the Period was approximately HK$94.3 million.

Slots

Slot machines recorded turnover of approximately HK$58.6 million from the operation of 348 slot seats, up from 333 seats as reported in the latest annual report. The slot machines returned an average win of approximately HK$900 per seat per day, compared with approximately HK$700 as reported in the latest annual report. Income for the Period was HK$18.2 million.

VIP Room — Self-managed

The Group managed one of the eight VIP halls within the hotel. Supported by a decade-long operating experience in Macau, the six gaming tables of the Group in its VIP hall, all of which offer baccarat, recorded a rolling of approximately HK$28.9 billion and an income of approximately HK$288.1 million. Average win per table per day was approximately HK$676,000, compared with approximately HK$579,000 as reported in the latest annual report.

Win percentage (calculated before discounts and commissions) was 2.6%, compared with 2.7% as reported in the latest annual report. The win percentage is subject to short-term fluctuation but is steady in the long run based on historical industry averages.

VIP Room — Rental

The Group received rental contribution from the leasing of five VIP halls operating within the hotel. Income was HK$16.9 million during the Review Period. The Group had leased out its sixth hall in October 2006.

Non-Gaming Revenue

The Grand Emperor Hotel recorded HK$71.7 million in non-gaming income, compared with HK$24.7 million as reported in the latest annual report. This comprised mainly of contributions from hotel rooms, food and beverage, as well as rental income from sauna, night club and retail space operations on the ground floor of the hotel.

The hotel rooms had an average daily rate of HK$700 during the Period. The occupancy rate of the available guestrooms was 81%, compared with 64% reported in the latest annual report.

Income from food and beverage was HK$25.9 million, and rental income from sauna, night club and retail space operations was HK$7.3 million. According to Macau Government Documentation and Information Centre, there were 12,411 hotel rooms in Macau as of September 30, 2006, a 16.2% increase from the previous year, with an average occupancy rate of approximately 70%. Amid growing competition and increase in room supply, the Group managed to attract and retain hotel guests with its top-class attentive service and high- end entertainment and lodging facilities.

The Group anticipates increasing contributions from the gaming arm when the hotel expands its operation following the increased supply of dealers from SJM.

For Enquiries:

Emperor International Holdings Limited/
Emperor Entertainment Hotel Limited
Sidney Luk
Tel: +852-2835-6715
Fax: +852-2893-5327
Email: sidneyluk@emperor.com.hk
Website: http://www.emp163.com