GALAXY ENTERTAINMENT GROUP SELECTED UNAUDITED Q1 2017 FINANCIAL DATA

GROUP ADJUSTED EBITDA UP 31% YEAR-ON-YEAR TO $3.2 BILLION UNIQUELY POSITIONED FOR FUTURE GROWTH

LAUNCHING COTAI - THE NEXT CHAPTER - SOON

CONTINUE TO PURSUE JAPAN

WITH MONTE-CARLO SBM STRATEGIC PARTNERSHIP PAID SPECIAL DIVIDEND OF $0.26 PER SHARE ON 28 APRIL 2017

Hong Kong, 4 May 2017 - Galaxy Entertainment Group ("GEG" or the "Group") (HKEx stock code: 27) today reported selected unaudited first quarter financial data for the three month period ended 31 March 2017. (All amounts are expressed in Hong Kong dollars unless otherwise stated)

Q1 2017 RESULTS HIGHLIGHTS

GEG: Continues To Drive Mass, Profitable Volumes and Control Costs

  • Q1 Group Revenue of $14.1 billion, up 5% year-on-year, down 2% quarter-on-quarter

  • Q1 Group Adjusted EBITDA of $3.2 billion, up 31% year-on-year, up 7% quarter-on-quarter

  • Played lucky in Q1 which increased Adjusted EBITDA by approximately $50 million

  • Latest twelve months Adjusted EBITDA of $11.1 billion

  • Hotel occupancy for Q1 across the Group's seven hotels was 97%

    Galaxy Macau™: Strong Performance Driven By Mass

  • Q1 Revenue of $10.2 billion, up 5% year-on-year, up 1% quarter-on-quarter

  • Q1 Adjusted EBITDA of $2.6 billion, up 27% year-on-year, up 9% quarter-on-quarter

  • Played lucky in Q1 which increased Adjusted EBITDA by approximately $75 million

  • Hotel occupancy for Q1 across the five hotels was 97%

    StarWorld Macau: Delivers Another Solid Quarter Driven by Mass

  • Q1 Revenue of $3.1 billion, up 6% year-on-year, down 10% quarter-on-quarter

  • Q1 Adjusted EBITDA of $649 million, up 27% year-on-year and up 2% quarter-on-quarter

  • Played unlucky in Q1 which decreased Adjusted EBITDA by approximately $25 million

  • Hotel occupancy for Q1 was 98%

    Broadway Macau™: A Unique Family Friendly Resort, Strongly Supported By Macau SMEs

  • Q1 Revenue of $135 million, versus $181 million in prior year and $159 million in Q4 2016

  • Q1 Adjusted EBITDA of $6 million, versus $3 million in prior year and $14 million in Q4 2016

  • No material luck impact for Q1 Adjusted EBITDA

  • Hotel occupancy for Q1 was virtually 100%

    Balance Sheet: Remains Well Capitalized and Liquid

  • Cash and liquid investments was $25.0 billion and net cash of $19.8 billion as at 31 March 2017

  • Debt of $5.2 billion as at 31 March 2017 primarily reflects ongoing treasury yield management initiative

  • Paid the previously announced special dividend of $0.26 per share on 28 April 2017

    Development Update: Macau's Largest Development Pipeline and Future Earnings Potential

  • Cotai Development - The Next Chapter, soon to commence construction to include hotel, MICE, entertainment and gaming

  • Hengqin - Plans moving forward to develop a leisure destination resort to complement our high-energy entertainment resorts in Macau, anticipated to disclose further details later in the year

  • International - Announced a strategic partnership with Monte-Carlo SBM to explore the development of IRs in Asia - including Japan

Dr. Lui Che Woo, Chairman of GEG said:

"We are pleased to report our financial results for the three month period ending 31 March 2017. Our financial results continued to show positive momentum over Q4 2016, with the Group reporting Q1 Adjusted EBITDA of $3.2 billion, up 7% quarter-on-quarter and up 31% over the same period last year. These results were achieved despite additional capacity entering the market in the later part of 2016.

We continue to drive each and every segment of our business with a particular focus on yielding our resorts and delivering profitable volumes. Our emphasis on executing our renowned 'World Class, Asian Heart' service combined with our unique and world-class resorts; have delivered memorable customer experiences and resulted in our portfolio of hotels being virtually 100% occupied during the period even as recent new competitive capacity continues to ramp up.

I am pleased to report that on 28 April 2017 we paid another special dividend of $0.26 per share, a 73% increase compared to April 2016. We continue to carefully manage our capital allocation with a view to the development of Cotai, Hengqin and international opportunities. To further support our international expansion ambitions in Asia including Japan, we are pleased to announce the strategic partnership with Monte-Carlo SBM.

The continuing growth in the emerging middle-class in the Mainland and their appetite for leisure, tourism and travel gives us continued confidence in the longer term outlook for Macau. GEG is embarking on its next growth program and will soon commence construction of Cotai - The Next Chapter, which will include hotel, MICE, entertainment and gaming. GEG has the largest and most well-defined development growth pipeline of all Macau concessionaires.

Finally, I would like to thank all of our hard-working staff, as our results would not be possible without their united efforts."

Market Overview

We are pleased to see that Macau is transitioning to a sustainable market recovery lead by mass. The positive trend of the later part of 2016 has continued into the first quarter of 2017. Gross Gaming Revenue ("GGR") for the first quarter of 2017 was $61.6 billion, up 5% over the fourth quarter of 2016 ($58.7 billion), this is the third consecutive quarter of GGR growth that Macau has experienced.

Visitation to Macau for the first quarter was 7.9 million, up by 6% year-on-year; overnight visitors rose by 12% to 3.9 million. The average length of stay of visitors increased by 0.1 day year-on- year to 1.2 days. Mainland visitors also recorded growth reaching 5.3 million, up 8% year-on-year, driven by strong growth of IVS of 2.8 million, up 14% year-on-year.

On the regulatory side, the MSAR Government announced that they have submitted to the Legislative Assembly that concessionaires would be able to retain smoking lounges on the main gaming floor and that they would need to install smoking lounges into VIP rooms by 1 January 2019.

In January 2017 three additional train lines to Zhuhai were added to the high speed rail network and a further four were added in April. This combined with the proposed opening of the Taipa Ferry Terminal in May this year and the opening of the Hong Kong-Zhuhai-Macau Bridge in 2018,

will further enhance the catchment and ease of access to Macau for both Chinese and international visitors.

Group Financial Results

Q1 2017

The Group posted revenue of $14.1 billion, up 5% year-on-year, and generated Adjusted EBITDA of $3.2 billion, up 31% year-on-year in Q1 2017. Galaxy Macau™'s Adjusted EBITDA was $2.6 billion, up 27% year-on-year. StarWorld Macau's Adjusted EBITDA was $649 million, up 27% year-on-year. Broadway Macau™'s Adjusted EBITDA was $6 million, versus $3 million in prior year.

Latest twelve months Adjusted EBITDA was up 25% year-on-year to $11.1 billion and up 7% quarter-on-quarter which is an indicator of business momentum.

During Q1 2017, GEG experienced good luck in its gaming operation which increased its Adjusted EBITDA by approximately $50 million. Normalized Q1 2017 Adjusted EBITDA was $3.1 billion, up 34% year-on-year and up 11% quarter-on-quarter.

The Group's total gaming revenue on a management basis1 in Q1 2017 was $13.1 billion, up 4% year-on-year but down 2% quarter-on-quarter. Total mass table games revenue was $5.8 billion, up 15% year-on-year. Total VIP revenue declined 5% year-on-year to $6.8 billion as a modest volume increase was more than offset by not playing as lucky.

GEG Q1 2017 Adjusted EBITDA (HK$'m)

$2,433

$2,961

$3,180

$2,037

$2,369$2,583

$512 $637 $649

$3 $14 $6

$26

$92

$25

$125

$24

$115

($237) ($209) ($197)

2016 Q1 2016 Q4 2017 Q1

Galaxy Macau™ StarWorld Macau Broadway Macau™ City Clubs Construction Materials Net Corporate Costs

1 The primary difference between statutory revenue and management basis revenue is the treatment of City Clubs revenue where fee income is reported on a statutory basis and gaming revenue is reported on a management basis.

Balance Sheet, Treasury Management and Special Dividend

The Group's balance sheet remains liquid and healthy. As of 31 March 2017, cash and liquid investments were $25.0 billion and net cash was $19.8 billion. Total debt decreased from $5.9 billion at 31 December 2016 to $5.2 billion at 31 March 2017. Our debt primarily reflects a treasury management exercise where interest income on cash holdings exceeds corresponding borrowing costs. Our strong balance sheet combined with substantial cash flow from operations allows us to return capital to shareholders via dividends and to fund our development pipeline and international expansion ambitions.

The Group paid the previously announced special dividend of $0.26 per share on 28 April 2017, a 73% increase compared to April 2016.

Galaxy Macau™

Galaxy Macau™ is the primary contributor to Group revenue and earnings. During Q1 2017, Galaxy Macau™ revenue was $10.2 billion, up 5% year-on-year, up 1% quarter-on-quarter to the best revenue quarter in over two years. Adjusted EBITDA was $2.6 billion, up 27% year-on-year, up 9% quarter-on-quarter. Adjusted EBITDA margin under HKFRS increased to 25% (Q1 2016: 21%), or 32% under US GAAP (Q1 2016: 27%).

Galaxy Macau™ experienced good luck in its gaming operations which increased its Adjusted EBITDA by approximately $75 million in Q1 2017. Normalized Q1 2017 Adjusted EBITDA was

$2.5 billion, up 32% year-on-year and up 10% quarter-on-quarter.

VIP Gaming Performance

Total VIP rolling chip volume for Q1 2017 was $131.8 billion, up 1% year-on-year, up 3% quarter-on-quarter. This translated to revenue of $5.1 billion, down 6% year-on-year and up 1% quarter-on-quarter.

VIP Gaming

HK$'m

Q1 2016

Q4 2016

Q1 2017

QoQ%

YoY%

Turnover

130,536

127,814

131,755

3%

1%

Net Win

5,458

5,057

5,113

1%

(6%)

Win %

4.2%

4.0%

3.9%

Mass Gaming Performance

Mass gaming revenue for Q1 2017 was $4.0 billion, up 21% year-on-year, up 3% quarter-on- quarter.

Mass Gaming

HK$'m

Q1 2016

Q4 2016

Q1 2017

QoQ%

YoY%

Table Drop

7,734

8,375

8,839

6%

14%

Net Win

3,284

3,860

3,968

3%

21%

Hold %

42.5%

46.1%

44.9%

Galaxy Entertainment Group Limited published this content on 04 May 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 04 May 2017 04:34:16 UTC.

Original documenthttp://www.galaxyentertainment.com/uploads/investor/4bfc4c23a661895df3dda0f18bbdb997785e5e54.pdf

Public permalinkhttp://www.publicnow.com/view/E576E26E59662E6118DEF4728D1C55BB9D0CD63C