UPDATE 1-Stanley Ho's SJM Q4 nearly triples on Macau growth

Wed Mar 16, 2011 7:52am EDT

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* Q4 net profit at HK$1.12 bln, up 160 pct

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* 15/19 analysts have buy or strong buy on stock (Adds further details, background)

By Farah Master

HONG KONG, March 16 (Reuters) - SJM Holdings (0880.HK), one of Asia's largest casino operators, reported a 160 percent rise in its fourth quarter net profit, beating forecasts due to stellar growth in Macau, the world's largest gaming market.

Controlled by gaming tycoon Stanley Ho, SJM is one of the six licensees allowed to operate in the former Portuguese colony where revenues outstrip that of Las Vegas several times over.

The biggest operator in the neon-lit enclave, made a fourth-quarter net profit of HK$1.12 billion ($143 million), according to its annual results.

The fourth-quarter result beat analysts' forecasts of HK$866 million and was nearly triple the HK$430.7 million made in the same period of 2009.

Gabriel Chan, analyst at Credit Suisse said the results were better than expected.

"It's around 5 percent above expectations," he said.

Analysts are mostly bullish on SJM, citing its over 30 percent market share in Macau and despite lingering concerns about the 89-year old chairman's recent dynastic tussle.

Shares in the lucrative gaming firm, which competes with Sands China (1928.HK) and Wynn Macau (1128.HK), rose 1.9 percent on Wednesday to $HK12.58, outperforming the main Hang Seng index's .HSI 0.1 percent gain.

Shares in SJM had fallen to as low as $HK10.58 in February from a record high of over HK$15 the previous month following a sensational legal spat between Ho and factions of his family -- including four wives and 17 known children.

The stock rebounded 8 percent last week after Ho said the dispute had been resolved. [ID:nTOE72A01F] <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ SPECIAL REPORT-The Macau Connection: link.reuters.com/reb58r Graphics on Macau gaming: link.reuters.com/dyp67r For a newsmaker on Stanley Ho :[ID:nTOE70O029] Factbox on Ho family feud over gambling assets [ID:nTOE70O05D] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

For the full year, SJM, reported a net profit of HK$3.5 billion, which compared with the market forecast of HK$3.3 billion according to Thomson Reuters Starmine.

In 2009 SJM made a net profit of HK$906.7 million

Ho's gambling empire, which had a lucrative monopoly until 2002, operates 17 casinos in Macau, significantly outnumbering the local operations of other casino magnates Sheldon Adelson's, Las Vegas Sands (LVS.N), and Steve Wynn's, Wynn Resorts (WYNN.O).

SJM posted an 282.3 percent increase in basic earnings per share (EPS) to HK$0.69 from HK$0.18 in 2009.

Adjusted EBITDA rose 113.2 percent to HK$4.8 billion, slightly higher than an expected HK$4.7 billion.

Macau gaming revenue has soared over the past year driven by a torrent of gamblers from mainland China. February's total jumped 48 percent to an all-time monthly high of $2.5 billion, around five times the Las Vegas strip's revenues for January, the last reported month from the Nevada Gaming Control board. [ID:nTOE72004C]

Revenue for SJM in 2010 rose 67.9 percent to HK$57.2 billion, in line with analysts' estimates.

The stock is rated by 15 out of 19 analysts as a 'buy' or 'strong buy' according to Thomson Reuters Starmine. There are no 'sell' recomendations. (Editing by Lee Chyen Yee)

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