Macau satellite casino operator Macau Legend has announced a significant increase in loss for 2024, totaling HK$667.23 million ($85.78 million) period, causing concerns about its ability to continue.
The group’s current bank borrowings of over HK$2 billion ($257.1 million), due to the group’s current financials may not be repayable. The group notes that even the current HK$166.4 million ($21.4 million) in default is unlikely to be repayable. In its most recent financials, the group indicates that ‘there exist circumstances that cast significant doubt on the Group’s ability to continue as a going concern’.
The group notes that the possibility to continue with sufficient working capital for at least 12 months from the end of 2024 ‘will depend upon the Group’s ability to generate sufficient financing and operating cash flows’.
This would only be possible via continual support from the lending banks to not take actions to demand immediate repayment of outstanding borrowings as a result of non-compliance with loan covenants. The group is also actively seeking support from the banks for the restructuring of the group’s outstanding installments due in 2025. The group is further seeking support from the controlling shareholder and substantial shareholders to not request repayment of shareholders’ loans of HK$339.4 million ($43.63 million). The group notes that it is also undertaking mitigating measures, including a cost control program.
During the year the group recorded total revenue of HK$771.5 million ($99.18 million), an increase of 4.3 percent yearly. Total gaming revenue for the period amounted to HK$393.1 million ($50.54 million), a yearly increase of 17.1 percent. This was all related to the service income received from Macau gaming concessionaire SJM for services and facilities provided relating to the mass market tables at the Legend Palace Casino.
Also during the period, the group reported HK$378.3 million ($48.63 million) in non-gaming revenue, a drop of 6.4 percent yearly. This was attributed to a drop in the average daily room rate. The group operates two hotels in Macau, the Legend Palace Hotel and the Harbourview Hotel.
