Local casino operator SJM Holdings Limited is expecting a positive run of events with aggregated annual earnings expected to cross $257 million via its Grand Lisboa Palace development.

Fitch Ratings confirms better earnings

Fitch Ratings Incorporated also confirmed that the firm will have a better earnings outlook once it’s Grand Lisboa Palace development is complete. A new report from Inside Asian Gaming includes an assessment from the senior notes of the firm which comes with a BB+ default rating.

The source also said that the fundraising exercise will be run by Champion Path Holdings Limited, a wholly-owned subsidiary of SJM Holdings Limited. The proceeds will subsequently be used to help pay for the general debt obligations of the firm.

SJM Holdings Limited is responsible for about 20 gambling-friendly properties across Macau. Its Grand Lisboa Palace project is a $5 billion development that began in February 2014. The project will help SJM better compete with the $3.2 billion Studio City Macau development from Melco Resorts and Entertainment Limited.

SJM expecting good results by this year

The 1,900-room property based in Cotai Strip is expected to start welcoming its first guests by March this year. According to Fitch Ratings, the earnings before interest, tax, depreciation, and amortization (EBIDTA) of the property should be well over $450 million.

The firm said,

“We believe Grand Lisboa Palace will allow SJM Holdings Limited to gain a foothold on the Cotai Strip and raise its market share. We forecast that Grand Lisboa Palace will have earnings before interest, tax, depreciation, and amortization of $257.93 million with 330 tables by 2022 and $451.41 million with 380 tables by 2023.”

It also expects the debt-to-earnings ratio of the firm to be around 7.1 for 2020. It could recover to 3.5 by 2022 and 1.8 to 2023.