MGM China Holdings Ltd. (2282.HK) reported first-quarter adjusted EBITDA of HKD 2.458 billion, beating consensus estimates by nearly 5 percent, even as sequential revenue and profit declined from the previous quarter.
CICC maintained its "Outperform" rating and HKD 16.10 price target on the news, noting the beat was primarily due to a lower-than-expected win rate during the period. JPMorgan analysts also noted the result was 5% above market forecasts in a separate report, where they rate the stock as Neutral.
The casino operator’s net revenue for the quarter was HKD 8.767 billion, a 10 percent increase year-over-year but down 9 percent from the fourth quarter. Adjusted EBITDA saw a similar pattern, rising 4 percent from the prior year but falling 11 percent sequentially. Both metrics have recovered to 152 percent of their pre-pandemic levels from the first quarter of 2019. The company did not disclose net profit or earnings per share for the period.
Despite the stronger-than-expected profit, shares fell 3.8 percent in Hong Kong trading on May 4, with short-selling volume accounting for over 45 percent of total turnover. The results highlight a potential normalization in gaming revenue after a strong post-reopening recovery.
The performance suggests that favorable operating efficiencies are supporting profits even as top-line growth moderates. Investors will be closely watching the upcoming Golden Week holiday data for signs of sustained underlying demand.
This article is for informational purposes only and does not constitute investment advice.
