Galaxy Entertainment Group’s increased interim dividend signals confidence in the sustainability of its cash flow despite a weaker second quarter, according to CBRE Equity Research.
The Macau gaming operator declared an interim dividend of HK$0.90 ($0.12) per share, 12.5 percent higher than its HK$0.80 final dividend for 2025.
CBRE analysts John DeCree and Max Marsh said the increase came despite a challenging quarter for the wider Macau market, geopolitical uncertainty and Galaxy entering the final stages of its current development program.
‘The dividend hike […] signals confidence in the overall business outlook and sustainability of cash flow,’ the analysts wrote.
Galaxy’s net cash position of approximately HK$36 billion ($4.6 billion) also provides substantial support for shareholder returns and its remaining development commitments.
‘The best dividend is a growing dividend,’ CBRE said, describing Galaxy’s balance sheet as a ‘fortress’.
The brokerage expects Galaxy to remain focused on completing its development pipeline and returning capital to shareholders through dividends, while also exploring opportunities outside Macau.
Galaxy reported adjusted EBITDA of HK$3.38 billion ($433 million) for the second quarter, down 5 percent year-on-year due largely to a difficult comparison with the previous year’s gaming hold.
However, CBRE estimated that adjusted EBITDA would have risen 8 percent after normalizing for hold. The brokerage said the mass-market gaming and non-gaming businesses remained resilient despite disruption from the FIFA World Cup, which was more pronounced in the VIP segment.
CBRE forecasts Galaxy’s adjusted EBITDA will reach HK$14.32 billion ($1.84 billion) in 2026 before increasing to HK$15.01 billion ($1.92 billion) in 2027.
Galaxy is completing Galaxy Macau Phase 4 and renovating StarWorld Macau. Phase 4 remains scheduled to open in 2027, adding 1,350 hotel rooms and suites, a 5,000-seat theater, retail and dining facilities, and a casino.
Around 40 percent of StarWorld’s rooms were unavailable during the second quarter, reducing the property’s EBITDA by an estimated HK$14 million ($1.8 million), according to CBRE.
The renovation includes combining some rooms to create larger premium suites and is expected to be completed by the first quarter of 2027.
