Date
22 October 2017
Galaxy Entertainment deputy chairman Francis Lui Yiu-tung (R) and group chairman Lui Che-woo (L) have announced a series of initiatives to boost employee morale and loyalty. Photo: HKEJ
Galaxy Entertainment deputy chairman Francis Lui Yiu-tung (R) and group chairman Lui Che-woo (L) have announced a series of initiatives to boost employee morale and loyalty. Photo: HKEJ

Galaxy sees mild margin pressure due to rising staff costs

Macau casino operator Galaxy Entertainment Group Ltd. (00027.HK) expects its profit margin to shrink by 1.0-1.5 percent due to rising employee costs amid a manpower shortage in the industry.

In a bid to retain staff, the company has announced a series of new compensation incentives and other benefits, which could drive up the related costs by as much as 20 percent.

The measures include additional bonuses of one month salary, company shares, and a 5 percent wage hike, the Hong Kong Economic Journal reported Wednesday, citing vice chairman Francis Lui Yiu-tung.

Lui said the gaming market in Macau has gradually picked up in July, with a potential 20 to 30 percent growth in the mass market. That should help fuel a double-digit gain in the city’s gaming revenue for the full year, he said.

Galaxy Entertainment posted 24.6 percent growth in revenue for the first half of the year, at HK$38.4 billion (US$4.95 billion). Earnings before interest, depreciation and amortization amounted to HK$7.3 billion, up 26 percent from a year ago.

The second phase of the company’s mega resort project Macau Galaxy will be completed on schedule next year, said Lui, adding that Galaxy Grand Waldo Hotel will also reopen next year after renovation, with adequate gaming tables expected to be granted by the Macau government.

Meanwhile, the company plans to begin recruiting by the end of this year staff for its Cotai project, on top of about 2,700 dealers for the casino at Macau Galaxy II.

Lui believes the industry will be able to ride out the challenges, given that about 10,000 new job seekers enter the market each year.

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Freelance journalist

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