Galaxy Entertainment : Media Release of Q4 & Annual Results 2016

Q4 2016 GROUP ADJUSTED EBITDA OF $3.0 BILLION, UP 20% YOY FULL YEAR 2016 GROUP ADJUSTED EBITDA OF $10.3 BILLION, UP 18% YOY

SUBSEQUENTLY ANNOUNCED ANOTHER SPECIAL DIVIDEND OF $0.26 PER SHARE PAYABLE ON OR ABOUT 28 APRIL 2017, A 73% INCREASE COMPARED TO APRIL 2016

Hong Kong, 28 February 2017 - Galaxy Entertainment Group Limited ("GEG" or the "Group") (HKEx stock code: 27) today reported results for the three months and twelve months periods ended 31 December 2016. (All amounts are expressed in Hong Kong dollars unless otherwise stated)

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Q4 2016 & FULL YEAR HIGHLIGHTS

GEG: Continues to Drive Mass Business, Profitable Volumes and Control Costs

• Q4 2016 Group Adjusted EBITDA, increased by 20% year-on-year and 10% quarter-on-quarter to $3.0 billion

• Full year Group revenue increased by 4% year-on-year to $52.8 billion

• Full year Group Adjusted EBITDA increased by 18% year-on-year to $10.3 billion

• Full year net profit attributable to shareholders ("NPAS") of $6.3 billion, an increase of 51% year-on-year including $0.5 billion of non-recurring charges

• Full year Adjusted NPAS of $6.8 billion, an increase of 17% year-on-year after adjusting for non-recurring charges

• Played lucky in Q4 2016 which increased Adjusted EBITDA by approximately $150 million

• Normalized Q4 2016 Adjusted EBITDA grew 20% year-on-year and 15% quarter-on-quarter to $2.8 billion

  Galaxy Macau™: Strong Performance Driven by Mass

• Q4 2016 Adjusted EBITDA increased by 16% year-on-year and 7% quarter-on-quarter to $2.4 billion

• Full year revenue increased by 7% year-on-year to $38 billion

• Full year Adjusted EBITDA increased by 22% year-on-year to $8.5 billion

• Full year non-gaming revenue increased by 21% year-on-year to $2.8 billion

• Hotel occupancy across the five hotels in Q4 2016 was 97%

• Played lucky in Q4 2016 which increased Adjusted EBITDA by approximately $100 million

• Normalized Q4 2016 Adjusted EBITDA grew 17% year-on-year and 14% quarter-on-quarter to $2.3 billion

  StarWorld Macau: Delivers Another Solid Quarter Driven by Mass

• Q4 2016 Adjusted EBITDA increased by 14% year-on-year and 19% quarter-on-quarter to $637 million

• Full year revenue decreased by 9% year-on-year to $11.8 billion

• Full year Adjusted EBITDA decreased by 2% year-on-year to $2.2 billion

• Hotel occupancy in Q4 2016 was 99%

• Played lucky in Q4 2016 which increased Adjusted EBITDA by approximately $40 million

• Normalized Q4 2016 Adjusted EBITDA grew 16% year-on-year and 18% quarter-on-quarter to $0.6 billion

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

• Q4 2016 Adjusted EBITDA was $14 million Vs $(4) million in Q4 2015

• Full year Adjusted EBITDA was $30 million Vs $(7) million in 2015

• Hotel occupancy in Q4 2016 was virtually 100%

• Played lucky in Q4 2016 which increased Adjusted EBITDA by approximately $10 million

• Normalized Q4 2016 Adjusted EBITDA was flat quarter-on-quarter at $8 million and up $5 million over prior year

  Balance Sheet: Remains Well Capitalized and Liquid

• Cash and liquid investments was $22.6 billion and net cash was $16.7 billion as at 31 December 2016

• Debt of $5.9 billion as at 31 December 2016 primary reflects ongoing treasury yield management initiative

• Paid two special dividends in 2016: $0.15 per share on 29 April and $0.18 per share on 28 October 2016

• Subsequently announced another special dividend of $0.26 per share payable on or about 28 April 2017, a 73% increase compared to April 2016

  Development Update: Robust Growth Development Pipeline

• Cotai Phases 3 & 4 - Continue to move forward with Phases 3 & 4 with the potential to commence construction in late Q1 or early Q2 2017, with a non-gaming focus, primarily targeting MICE, entertainment and family facilities

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

• International - Continuously exploring opportunities in overseas markets, including Japan

Dr. Lui Che Woo, Chairman of GEG said:

"We are pleased to report our financial results for the three months and twelve months periods ending 31 December 2016. We have delivered very credible and solid results given the challenging operating environment that we experienced for the majority of 2016. Despite these challenges, the Group reported Q4 Adjusted EBITDA of $3.0 billion, up 10% quarter-on-quarter and full year Adjusted EBITDA of $10.3 billion up 18% year-on-year.

We have worked hard during the period to carefully control costs without adversely impacting customer service standards and to substantially grow our Mass Market business. Our portfolio of luxury hotels were virtually 100% occupied during the year and we reported non-gaming revenue of $3.2 billion an increase of 18% year-on-year; this demonstrates our commitment to support the Macau Government's efforts to diversify the economy and grow non-gaming revenue.

During the year, we paid two special dividends of $0.15 and $0.18 per share. And I am pleased to announce today that we will pay another special dividend of $0.26 per share this year on or about 28 April 2017, a 73% increase compared to April 2016. This confirms our commitment to return capital to shareholders, whilst maintaining an exceptionally strong and liquid balance sheet to fund our growth development pipeline and international expansion ambitions.

In the medium to longer term we are positive on the outlook for Macau and are confident that Macau will develop into a World Center of Tourism and Leisure as envisioned by the Macau Government and we are pleased to be able to support this Government lead vision.

Finally, I would like to extend my sincere appreciation to all of our committed and hard-working staff who deliver exceptional customer moments and are committed to our renowned 'World Class, Asian Heart' service philosophy."

Market Overview

The Macau gaming market finished the year on a positive note where from August onwards, Gross Gaming Revenue ("GGR") reported positive growth. In addition to the growth of GGR in the later part of 2016, the market also experienced a shift in the mix of gaming revenue from VIP to the Mass market.

Visitation to Macau in 2016 was 30.95 million compared to 30.71 million in 2015. However with the addition of new hotel capacity during the year overnight visitation has increased for seven consecutive months since June 2016 and was up 10% year-on-year to 15.7 million for the full year. For the first time in the last ten years, overnight-stay visitor arrivals exceeded same-day visitor arrivals. In 2016, the average length of stay of overnight visitors stood at 2.1 days. This is a particularly encouraging sign as new capacity has driven increased overnight visitation and it is estimated that overnight visitors spend more than day trippers.

In 2016 infrastructure designed to enable easier access to Macau and movement within Macau continued to progress and we look forward to the completion of these infrastructure projects. These projects will further enhance the appeal and easy of travel to and from Macau and travel within Macau for both Chinese and International visitors.

Group Financial Results

Financial Year of 2016

The Group posted revenue of $52.8 billion, up 4% year-on-year, and generating Adjusted EBITDA of $10.3 billion, up 18% year-on-year in 2016. Net profit attributable to shareholders was

$6.3 billion. Galaxy Macau™'s Adjusted EBITDA was $8.5 billion, up 22% year-on-year. StarWorld Macau's Adjusted EBITDA was $2.2 billion, down 2% year-on-year. Broadway Macau™'s Adjusted EBITDA was $30 million Vs $(7) million in 2015.

GEG experienced good luck in its gaming operation during 2016, which increased its Adjusted EBITDA by approximately $480 million. Normalized 2016 Adjusted EBITDA grew 10% year-on- year to $9.9 billion.

The Group's total gaming revenue on a management basis1 in 2016 was $49.5 billion, up 2% year-on-year as total mass table games revenue was $21.0 billion, up 19% year-on-year and total VIP revenue was $26.5 billion, down 8% year-on-year.

$8,736

$10,348

$6,946

$8,508

$2,185 $2,150

($7) $30

$107

$318

$107

$434

$(813) $(881)

FY 2015 FY 2016

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 Dividends

The Group's balance sheet remains liquid and healthy. As of 31 December 2016, cash and liquid investments were $22.6 billion and net cash was $16.7 billion. Total debt increased from $1.2 billion at 31 December 2015 to $5.9 billion at 31 December 2016. This was due solely to 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.

In 2016, GEG returned capital to shareholders by paying two special dividends of $0.15 per share and $0.18 per share on 29 April 2016 and 28 October 2016, respectively. Subsequently the Group announced another special dividend of $0.26 per share to be paid on or about 28 April 2017, a 73% increase compared to April 2016.

Q4 of 2016

Finishing the year on a positive note, Q4 Group revenue increased 11% quarter-on-quarter to

$14.4 billion and Adjusted EBITDA increased 10% quarter-to-quarter to $3.0 billion. Galaxy Macau™'s Adjusted EBITDA increased 16% year-on-year to $2.4 billion. StarWorld Macau's Adjusted EBITDA increased 14% year-on-year to $637 million in Q4. Broadway Macau™'s Adjusted EBITDA was $14 million Vs $(4) million in 2015.

During Q4 2016, GEG experienced good luck in gaming operations which increased Adjusted EBITDA by approximately $150 million. Normalized Q4 2016 Adjusted EBITDA grew 20% year- on-year and 15% quarter-on-quarter to $2.8 billion.

The Group's total gaming revenue on a management basis2 in Q4 2016 increased 7% year-on- year to $13.3 billion as total mass table games revenue increased by 15% year-on-year to $5.6 billion while total VIP revenue increased 3% year-on-year to $7.2 billion.

2 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.