Inside Asian Gaming

INSIDE ASIAN GAMING | March 2011 8 land parcel GEG has the right to develop on Cotai. He added the company has already begun working on the second phase of the property, with further details to be announced in due course. Mr Lui dismissed market rumours that some of the land parcel will be sold to a third party. “We are going to develop every inch of the land,” Mr Lui affirmed. Undervalued? Immediately after the announcement of the opening date, Union Gaming Research issued an upbeat comment on GEG stock (SEHK:00027), saying Galaxy Macau could easily “outperform very low expectations.” Union Gaming forecasts GEG’s 2011 net revenue and EBITDA to reach HK$30.7bn and HK$3.4bn, respectively, in 2011, and HK$44.5bn and HK$5.4bn, respectively, in 2012, adding its 2012 EBITDA estimate is 7% higher than current consensus expectations. GEG shares are currently trading at 16.2x Union Gaming’s 2011 EBITDA estimate and 9.3x the 2012 estimate. GEG is the third Macau casino operator to open a property in Cotai. Wynn Macau is also in the process of designing a new 52- acre property in Cotai slated to open in late 2014 or early 2015. An oasis beckons—Galaxy Macau Advancing Macau—Dr Lui CheWoo Good things take time—Francis Lui date was set to give Galaxy Macau staff more time to fine-tune their customer service skills. “We could have rushed it [in order to be open by Golden Week], but we decided that it is more important to give our customers the best experience possible.” According to Mr Lui, the first phase of Galaxy Macau only occupies one third of the even though the new GEG and Sands China properties have capacity to host nearly double that number. GEGVice-Chairman Francis Lui expressed confidence the government would allow Galaxy Macau to add more gaming tables if the demand arises, saying he believed the table cap was imposed in order to prevent gaming capacity from getting too far ahead of player demand, as opposed to limiting the industry’s growth. Other draws At opening, Galaxy Macau will also feature 50 dining outlets and a Banyan Tree spa, as well as ‘the world’s largest sky wave pool’, spanning 4,000 square meters with waves over 1.5 meters in height, and a man-made beachmade with 350 tons of white sand. Dr Lui Che Woo, Founder and Chairman of GEG, said Galaxy Macau will advance Macau’s transformation into an entertainment and leisure centre by giving the city its first resort tailor-made for the Chinese and Hong Kong travelers. Francis Lui revealed there are plans for the property to host concerts, filmpremieres and other events to enrich Macau’s tourism appeal. Additionally, GalaxyMacauwill boast Macau’s first 3D cinema with 9 screens, set to open in late 2011. Galaxy Macau will open shortly after the holiday period following Labour Day on 1st May, and thus will not benefit from the traditional influx of Chinese visitors to Macau during the so-called ‘Golden Week’ period. Francis Lui explained the opening Galaxy Macau