Macau Legend Development Limited Announces 2013 Interim Results

HONG KONG, Aug. 26, 2013 /PRNewswire/ -- Macau Legend Development Limited ("MLD" or the "Company"; SEHK Stock Code: 1680), one of the leading owners of entertainment and casino gaming facilities in Macau, today announced unaudited consolidated financial information of the Company and its subsidiaries (collectively the "Group") for the six months ended 30 June 2013 (the "Period").

FINANCIAL HIGHLIGHTS

The Group

• Half year revenue increased 25.2% year on year to HK$843.8 million
• Gaming and non-gaming revenue increased by 19.2% to HK$623.0 million and 45.8% to HK$220.8 million, respectively
• Half year adjusted EBITDA increased 17.6% year on year to HK$431.6 million
• Profit attributable to owners of the Company was HK$266.7 million, down 5.7% year on year. The decrease was mainly due to the inclusion of the one-off costs incurred associated with the Listing ("One-off Listing Costs") in the current period of HK$39.5 million (Year 2012: HK$4.8 million). Excluding the One-off Listing Costs, the profit attributable to owners of the Company would have been an increase of 6.5% year on year

MFW Group

• Started to generate positive Adjusted EBITDA contribution to the Group of HK$3.2 million (Year 2012: a loss of HK$5.8 million)

The Group completed the acquisition of Macau Fisherman's Wharf International Investment Limited and its subsidiaries (the "MFW Group"), which operates Macau Fisherman's Wharf ("MFW") on 18 May 2012 and since then the Group consolidated the results of MFW Group. As such, the consolidated results of the Group for the six months ended 30 June 2012 included results of MFW Group for the period from 19 May 2012 to 30 June 2012.

OPERATIONAL HIGHLIGHTS

Gaming

• Half year gaming revenue increased 19.2% year on year to HK$623.0 million. Revenue from Mass Market Tables and VIP Rooms increased by 20.8% and 17.7%, respectively

Non-gaming

• Half year non-gaming revenue rose 45.8% to HK$220.8 million
• The Group's hotel operations, i.e., The Landmark Macau and the Rocks Hotel, achieved an improved average occupancy rate of 91.9% and 79.0%, respectively
• Renovation work currently being undertaken at The Landmark Macau is expected to be completed by end of 2013

MFW Redevelopment

• The construction of the Harbourview Hotel has started and is expected to complete in third quarter of 2014
• The Company entered into a Supply and Technical Assistance Agreement with the Macau Animal Fossil Preservation Association on 20 August 2013 for the proposed Dinosaur Museum
• The Company entered into a Memorandum of Understanding with Dynam Japan Holdings Co., Ltd. on 23 August 2013 to introduce a minimum of 100 next generation pachinko machines and other electronic games at various sites at MFW commencing in 2014 and establish marketing joint venture agreement for customers in Japan and Korea

For the six months ended 30 June 2013, the Group recorded total revenue of HK$843.8 million, an increase of HK$169.9 million or 25.2% over that of the last corresponding period. Gaming revenue and non-gaming revenue of the Group increased by 19.2% to HK$623.0 million and by 45.8% to HK$220.8 million respectively when compared to the last corresponding period.

Co-Chairman, Executive Director and Chief Executive Officer, Mr. David Chow, said, "The increase in gaming revenue was primarily driven by the increase in revenue from both the mass market and VIP gaming segments at Pharaoh's Palace Casino and the consolidation of revenue from gaming services of MFW Group at Babylon Casino of HK$69.2 million for the full reporting period."

"The Group's reported profit for the period amounted to HK$266.7 million. When we exclude those One-off Listing Costs associated with the Listing, the Group's profit for the period amounted to HK$306.2 million, an increase of HK$18.6 million or 6.5% over that of the last corresponding period of HK$287.6 million," Mr. Chow said.

Adjusted EBITDA for the current period grew by 17.6% to HK$431.6 million. The increase in Adjusted EBITDA was mainly due to the increase in Adjusted EBITDA from the gaming operations of both Pharaoh's Palace Casino (by HK$67.7 million or 18.3%) and Babylon Casino (which in turn was mainly due to full six-month consolidation in current period but only for the period from 19 May 2012 to 30 June 2012 for the last corresponding period).

During the current period, operations of MFW Group (including gaming and non-gaming) started to generate positive Adjusted EBITDA contribution to the Group of HK$3.2 million (six months ended 30 June 2012: negative Adjusted EBITDA of HK$5.8 million).

The Group's profit excluding MFW Group for the period amounted to HK$321.2 million, an increase of HK$23.3 million or 7.8% over that of the last corresponding period of HK$297.8 million. The increase was mainly attributable to the increase in profit generated from the gaming operations at Pharaoh's Palace Casino in the current period when compared to the last corresponding period.

Mr. David Chow, said "This is the Group's first results announcement following our successful listing on the Hong Kong Stock Exchange on 5 July 2013, and we are please that the first half of the year was very fruitful. During this period, we recorded encouraging results and the redevelopment project of Macau Fisherman's Wharf also progressed as planned in terms of timing and costs."

The directors of the Company do not recommend the payment of an interim dividend for the six months ended 30 June 2013.

FINANCIAL AND OPERATIONAL REVIEW

Gaming Operations

Gaming revenue growth driven by increase in mass market table wins and VIP game turnover

As at 30 June 2013, the Group had a total of 325 slot machines and 150 gaming tables in its two casinos, Pharaoh's Palace Casino at The Landmark Macau and Babylon Casino at Macau Fisherman's Wharf. On 31 May 2013, 12 gaming tables were temporarily not in operation at two VIP rooms at The Landmark Macau. Among the 150 gaming tables, Pharaoh's Palace Casino has 60 mass gaming tables and 67 VIP tables while Babylon Casino has 23 mass gaming tables. On 27 July 2013, a new VIP room utilizing 6 of these gaming tables commenced operation. The Group is now screening for a gaming promoter to operate the other VIP room at The Landmark Macau.

For the six months ended 30 June 2013, the Group posted a total gaming revenue of HK$623.0 million, a 19.2% increase as compared to that of HK$522.5 million in the last corresponding period.

The average number of mass gaming table at the Pharaoh's Palace Casino was reduced from 66 to 60 for the six months ended 30 June 2012 and 2013, respectively as tables were relocated to VIP rooms at The Landmark Macau. This increased the average number of VIP tables to 59 in the current period from 52 in the last corresponding period.

Revenue from mass market tables for the period increased by 20.8% to reach HK$549.4 million from last year. The increase was primarily driven by increase in both games drop and hold rate at the Pharaoh's Palace Casino. This improvement was despite a reduction in the average number of mass gaming tables at Pharaoh's Palace Casino during the period. During the period, net win per table per day of the mass market tables at the Pharaoh's Palace Casino amounted to HK$81,000, representing a 20.9% increase over the last corresponding period.

Revenue from VIP rooms for the period increased by 17.7% to HK$68.1 million from the last corresponding period. The increase was primarily attributable to the increase in average number of VIP tables during the period. The increase in games turnover during the period also contributed to the improved VIP revenue. Net win per table per day of VIP tables for the period recorded a growth of 4.2% to reach HK$319,000.

Non-gaming Operations

MFW Redevelopment project progresses as planned

For the six months ended 30 June 2013, the Group's total non-gaming revenue increased by 45.8% to reach HK$220.8 million. Non-gaming revenue for the current period from The Landmark Macau and Macau Fisherman's Wharf accounted for 59.4% and 40.6% of the total non-gaming revenue, respectively.

Hotel Operations

The Landmark Macau and the Rocks Hotel achieved an average occupancy rate of 91.9% and 79.0% respectively during the period, while MFW attracted a total of around 1.7 million visitors, a 3% growth compared to that of the last corresponding period.

During the period under review, renovation work at The Landmark Macau was on schedule. Over 50% of the hotel rooms have completed renovation on 30 June 2013 and the renovation work of the remaining hotel rooms will be substantially completed by the end of 2013. The construction of the sauna and spa facility, which is expected to occupy a gross floor area of approximately 3,160 square meters, also commenced and is expected to be completed by the third quarter of 2013.

MFW Redevelopment

During the period, the MFW redevelopment project progressed as planned in terms of timing and costs. Construction of superstructure of the Harbourview Hotel has been commenced with three floors already erected. Demolition work of Tang Dynasty has started and is expected to be completed by first quarter of 2014 allowing for construction of the Legend Palace Hotel on this site. An agreement has also been entered into between Macau Animal Fossil Preservation Association and the Group for the supply and technical assistance of dinosaur fossils for display in at the planned Dinosaur Museum at MFW.

Cooperation with Dynam

On 23 August 2013, the Company entered into a Memorandum of Understanding for Business Cooperation (the "MOU") with Dynam Japan Holdings Co., Ltd. ("Dynam"). Pursuant to the MOU, Dynam will establish and operate a minimum of 100 next generation pachinko machines and other electronic games at various sites at MFW, commencing in 2014, subject to approval from the Macau government. In addition, under the terms of the MOU, Dynam will enter into a marketing joint venture agreement with the Group.

Prospects

Commenting on the prospects of the Group, Mr. Carl Tong, Co-Chairman and Non-executive Director, said, "We are confident in the long-term growth prospect of the Macau gaming industry. The Macau government's support in terms of policies and infrastructure improvements will further facilitate the influx of visitors. The redevelopment of MFW will transform tourism in the Macau Peninsula, offering one-stop family entertainment as well as cultural and educational experiences."

"As the Company completes the MFW Redevelopment over the next few years, the Group will benefit from opportunities created by the completion of major transportation and infrastructure networks in Macau. Upon completion of the MFW Redevelopment, the number of hotel rooms of the Group will increase from the current of 511 to nearly 1,800 and the number of gaming tables at the casinos in The Landmark Macau and MFW will increase from current of 150 to 500. We are well positioned to capture the opportunities ahead of us," concluded Mr. Chow.

About Macau Legend Development Limited

Macau Legend Development Limited ("MLD" or "the Company") is one of the leading owners of entertainment and casino gaming facilities in Macau. It has two major properties, The Landmark Macau, an award-winning integrated hotel, casino and luxury complex, featuring a five-star hotel and Macau's first themed casino, and Macau Fisherman's Wharf, an integrated gaming, hotel, convention and entertainment complex located on the outer harbor of the Macau Peninsula.

Shares of MLD have been successfully listed on the Main Board of the Hong Kong Stock Exchange with effect from 5 July 2013.

In addition to operating its hotels and non-gaming entertainment facilities, MLD provide gaming services to Sociedade de Jogos de Macau, S.A. ("SJM") at Pharaoh's Palace Casino, which is located in The Landmark Macau, and Babylon Casino at Macau Fisherman's Wharf.

About The Landmark Macau

The Landmark Macau features one of the largest, award-winning, five-star hotels in the Macau Peninsula, offering 439 rooms and suites, as well as casino and gaming areas, recreational and dining space, retail shops, commercial and office premises, and residential apartments. The casino areas of The Landmark Macau comprise Pharaoh's Palace Casino, VIP rooms and a slot machine hall, and occupy a total of approximately 17,644 square meters in gross floor area.

The Company is currently renovating The Landmark Macau, including refurbishing hotel rooms and planning to expand the lobby, add retail space, etc. The Company has remodeled the restaurant on the mezzanine level of the building and added new VIP rooms on the 20th to 22nd floors of the hotel.

About Macau Fisherman's Wharf

Macau Fisherman's Wharf is a waterfront integrated gaming, hotel, convention and entertainment complex located on the outer harbor of the Macau Peninsula. It is the largest entertainment and leisure complex in the Macau Peninsula in terms of site area. It has an operating site area of 109,495 square meters, and features Babylon Casino, a convention and exhibition center, a boutique hotel offering 72 rooms, a marina, an amusement arcade and shopping, dining and entertainment areas, and 16,239 square meters of car park space. Babylon Casino, located in Macau Fisherman's Wharf, occupies over 10,000 square meters in gross floor area.

About the Macau Fisherman's Wharf Redevelopment Project

The Company is currently undergoing the redevelopment of Macau Fisherman's Wharf. Under the envision, the MFW Redevelopment Project is a redevelopment of existing facilities as well as the addition of new facilities, including the Harbourview Hotel, the Legend Palace Hotel, the Legendale Hotel, a general entertainment and cultural facility, a canopied open-air shopping, dining and entertainment colonnade, a yacht club at the Marina and other attractions. These and other facilities identified for redevelopment and construction are currently in varying stages of design, capital commitment planning, budgeting, land acquisition or construction. Upon completion of the MFW Redevelopment Project, Macau Fisherman's Wharf is expected to have over 1,300 rooms and around 350 gaming tables.

For enquiries, please contact:

Macau Legend Development Limited
Rosita Lao / Donald Chow
Tel: (853) 2822 2211
Email: [email protected]

SOURCE Macau Legend Development Limited

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