Melco Resorts & Entertainment has declared it will secure up to HK$5.03 billion through a stock offering and loans from its parent organization to tackle the difficulties of its substantial income decrease in the initial six months of 2022.
Melco Resorts & Entertainment’s income in the first half of 2022 was HK$4.12 billion, signifying a 20.9% reduction compared to the same timeframe in 2021.
In comparison to the pre-pandemic income of HK$17.07 billion in the initial six months of 2019, income has plummeted by 75.8%.
Gaming income alone was HK$3.81 billion, showing a 24.9% year-over-year decline and a 77.2% drop compared to 2019. The majority of this income originated from mass market table games, which generated HK$3.43 billion. VIP gaming income was HK$386.9 million, and slot machines and other gaming income totaled HK$248 million.
The remaining HK$317.7 million stemmed from hotel, food and beverage, retail, and rental-related income.
After subtracting special gaming taxes, special levies, and gaming premiums, totaling HK$1.66 billion, net gaming income was HK$2.14 billion.
Income from hotels, restaurants, retail, rentals, and other services amounted to HK$317.7 million, and there was also an increase of HK$2.2 million in profit sharing from joint ventures.
Despite the decrease in income, expenditures have risen.
Management and administrative expenditures were the most significant, reaching HK$4.36 billion, a rise of HK$513.9 million from the initial half of 2021. Financial expenses were HK$398 million, a year-on-year increase of HK$381.4 million.
The remaining HK$462.1 million includes marketing and promotional costs, sales and service charges related to hotel operations, and other losses.
After deducting expenses, the pre-tax loss was HK$2.75 billion. After subtracting HK$10.7 million in taxes, the total loss for the period was HK$2.77 billion, an increase of 84.9% from the corresponding period last year.
This is HK$4.5 billion less than pre-pandemic levels.
Adjusted EBITDA was a loss of HK$1.17 billion, more than double the loss of HK$510 million in the first half of 2021.
Sands China’s GGR was HK$705 million, while Sands Cotai Central’s GGR was HK$231 million. The GGR of other self-operated casinos (including Sands Macau, Sands Macao, Sands Oriental, and Sands Taipa) was HK$674 million.
Satellite casinos, which are 14 third-party promoted casinos, had a GGR of HK$2.46 billion.
The company also mentioned details of the upcoming share issuance and a HK$2 billion loan provided by its parent company, Las Vegas Sands.
Las Vegas Sands will provide Sands China with a HK$2 billion loan for a period of six years at an annual interest rate of 4%.
A maximum of 1.45 billion shares will be issued as part of the fundraising, at a price of HK$2.08 per share. After deducting expenses, Sands China expects to raise HK$200 million.
The Macau administration has issued six bids for gaming permits. To be eligible for one of these permits, City of Dreams must attain a minimum equity level. They will utilize HK$2.7 billion of the HK$93 billion to achieve this. The remaining HK$3.1 billion will be allocated for other purposes.
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