Margin Improvement in Sight for SJM as 2026 Marks a Turning Point

SJM Holdings says 2026 is shaping up as an important inflection point, with completed table redeployments and ongoing portfolio upgrades expected to support better margins and stronger returns. Chairman and executive director Daisy Ho said the company believes the changes made in 2025 now provide a base for improved earnings quality.

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Structural Shift

In its latest annual report released on Monday, SJM said the foundations laid in 2025 should help drive a change in the quality of its earnings. That year was marked by structural transition, including the closure of multiple satellite casinos under Macau’s revised gaming framework.

The restructuring created short-term revenue disruption, but the company now sees the next phase as one of progressive improvement. Daisy Ho said that with table redeployments completed and portfolio upgrades coming onstream, the group expects to see better profit margins and stronger returns from its directly operated portfolio.

Ho said that the moves are consistent with the overall shift towards a more sustainable business model. The focus, she added, is on strengthening earnings quality through disciplined execution and the systematic redeployment of tables and resources into directly operated properties.

2025 Results

SJM posted a loss of HK$429 million ($54.7 million) last year, even though gross gaming revenue was relatively steady at HK$28.62 billion ($3.65 billion), while adjusted EBITDA was also at HK$3.2 billion ($408.2 million). The results reflected the impact of the company’s restructuring and the closure of satellite casinos.

As per SJM, the transformation towards direct operations will play a pivotal role in boosting results in the longer term. Daisy Ho revealed that the company would benefit from the new operating structure through better margins, efficient cost structure, and better quality of the product and services offered.

This represents a major departure from the satellite-style operations of SJM in Macau. Instead, the company has now begun to concentrate on directly managed venues in Macau.

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Property Changes

As part of the transition, SJM has been consolidating operations on the Macau Peninsula. It has been reallocating gaming tables and slot machines from closed satellite venues to self-promoted properties. The group also completed acquisitions of additional gaming space within Hotel Lisboa and the L’Arc Hotel, which have now been integrated into its directly operated portfolio.

Those moves are expected to support the company’s margin outlook as the redeployment process continues to settle. SJM said the changes are designed to improve how its floor space and gaming assets are used across the portfolio.

Asset Upgrades

Upgrades across key assets are also expected to play a role in the company’s margin recovery. The Hotel Lisboa is expected to add 400 renovated rooms during the latter part of the year 2026, along with additions of gaming zones on a staged basis. The Grand Lisboa Macau is also expanding its room capacity and facilities.

In Cotai, Grand Lisboa Palace has increased table capacity after the satellite transitions. The property has added new gaming areas, including the Sky Phoenix West Tower VIP area, while converting the Dragon Pavilion to support premium mass operations. SJM said these changes are part of a broader effort to improve floor mix and raise returns from directly operated assets.

Next Phase

According to management, the company remains committed to maintaining efficient execution, cost management, and reinvestment initiatives. With most satellite effects having been fully incorporated, the group now seeks to enhance efficiency and build a customer base of better quality.

Daisy Ho said the company now believes 2026 marks a shift in direction, with the operational changes made over the past year beginning to support better returns. SJM’s latest outlook suggests that the company sees its next phase of growth as one built around margin recovery, asset upgrades, and tighter control over its direct operations.

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Source: Asia Gaming Brief