Galaxy Entertainment Group
POWER SCORE: 4,490
POSITION LAST YEAR: 1
CLAIMS TO FAME
- Built Galaxy into Macau’s de facto local gaming champion
- Substantial liquidity left Galaxy best-positioned to ride out COVID-19 pandemic
- Holds strategic stakes in Monte Carlo casino operator SBM and Wynn Resorts
LIKE EVERYONE in Macau, Galaxy Entertainment Group has felt the financial pain of the COVID-19 pandemic. Having reported a HK$4 billion (US$514 million) loss in 2020, GEG only just sneaked back to a HK$900,000 (US$116,000) profit in the first six months of 2021 with recent COVID scares and border restrictions around October Golden Week casting doubt over what 2H21 results might hold.
But with Francis Lui at the helm, GEG’s conservative fiscal policy has it better placed than any of its fellow Macau casino concessionaires, who have relied heavily on sizeable new loan facilities and bank waivers to ride out the pandemic. According to updates provided in August, the company held liquid investments of HK$43.0 billion (US$5.53 billion) and net cash of HK$31.6 billion (US$4.06 billion) as of 30 June 2021, making it the only one of Macau’s “Big 6” to hold a net cash position.
And there is much to look forward to in 2022, even amid the uncertainty surrounding COVID-19 and the expiration of gaming licenses on 26 June.
Galaxy Macau Phase 3, originally due to open in 2021 but delayed as a result of the pandemic, will be Macau’s most significant property launch of the year, comprising a raft of new gaming and non-gaming elements including Galaxy International Convention Center, an Andaz Hotel and an all-suite Raffles at Galaxy Macau, featuring 450 suites under the famous Singapore hotel brand.
Galaxy Phase 3 will be closely followed by Phase 4, and between them will see Galaxy Macau add a combined 3,000 rooms across eight new hotel brands targeted at the premium segment via high-end family rooms and villas.
This will more than double the offerings at GEG’s flagship property, which currently boasts six hotels including top end Ritz-Carlton and high-quality Asian brands Okura and Banyan Tree.
It will also help boost the company’s Macau market share, analysts say. Currently sitting just behind Sands China at around 21% market share, it is predicted that Phases 3 and 4 will give GEG a small boost in VIP and substantial boost in the more lucrative mass market segment once fully operational.
It is perhaps the significance of GEG’s Macau expansion that allowed the company to pause its pursuit of an integrated resort license in Japan in May with little to no fanfare, having previously expressed an interest in Yokohama among other locations. Given Yokohama’s recent withdrawal from Japan’s IR race under a new mayor, GEG’s decision in that regard looks even more astute.
It is this considered approach that has formed the backbone of Galaxy’s success, an achievement made even more impressive by the fact that neither Francis Lui nor his father, group Chairman Lui Che Woo, had any notable gaming industry experience when Galaxy Entertainment Group won a Macau gaming concession back in 2002.
Twenty years on, the company approaches Macau’s long-awaited license re-tendering process as one of the elite heavyweights of Asian gaming.
For the full list of 2021 Asian Gaming Power 50 winners, click here.