Investment holding company Kingston Financial Group Ltd. registered a 2 per cent decrease in revenue derived from its gaming operations in Macau for the six months ended September 30, amounting to HK$231.8 million (US$29.8 million), down from HK$235.3 million one year ago, it informed the Hong Kong Stock Exchange last Friday.
The group owns Casa Real Hotel and Grandview Hotel in the city, and operates gaming businesses in the two properties under the licence of Sociedade de Jogos de Macau, S.A. (SJM).
As at the end of September, the Hong Kong-listed company was operating 63 mass-gaming tables, an increase of three year-on-year, while the number of the group’s VIP tables decreased by two year-on-year to 12, and that of slot machines and live baccarat tables also dropped by six and 19 year-on-year to 232 and 115, respectively.
The company said gaming revenue accounted for approximately 73 per cent of its total hotel and gaming business turnover. Meanwhile, the group’s gaming commissions – amounts paid in order to attract customers – fell by 14 per cent year-on-year to HK$48.6 million for the six months.
Hotel revenues drop
On the other hand, earnings from Kingston’s hotel operations in the MSAR also registered a drop of 12 per cent year-on-year between March and September, down to HK$86.6 million compared to HK$98.4 million last year, despite the fact that the occupancy rate of its two hotel properties both recorded increases.
The average occupancy rate of Casa Real on the Macau Peninsula rose three percentage points year-on-year to 86 per cent for the fiscal first half, while that of the Grandview Hotel in Taipa increased four percentage points to 76 per cent.
The company explained in the filing that the decreases in its overall business performance in the MSAR were ‘in line with the decline in the industry’ affected by ‘the slowing economy in China and anti-graft drive’. However, the filing explained that the gaming business had continued to ‘provide a stable income’ for the group.
The group also expects the city’s hotel and tourism market segment to ‘stabilise’ in 2017, given the steady demand from international and local markets. Yet, the group claimed it would maintain a ‘conservative outlook’ due to ‘the slowdown in tourist spending and China’s campaign against corruption and luxury spending’.
Decreased net profits
For the first six months of its fiscal year, the company saw its total revenues fall by 17 per cent year-on-year down to HK$1.3 billion, while net profit attributable to the owners plunged by 19 per cent year-on-year to HK$744.4 million.
It explained the decrease in the interim net profit was due to ‘the decrease in income from securities brokerage, underwriting and placements business’, which slumped by 77 per cent year-on-year to HK$118.5 million for the six months.
