SBM Reports €280 Million Revenue Loss, Gaming Drops 48%

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Forbes MC Staff   Forbes Monaco

SBM Reports €280 Million Revenue Loss, Gaming Drops 48%

Photo: Forbes Monaco/Nancy Heslin

Sociéte des Bains de Mer (SBM) has reported the Group’s 2020-21 consolidated income, confirming that Covid has had a “major impact” on their gaming and hotel/catering activities.

In a press release, the Group stated from the period of April 1, 2020, to March 31, 2021, during which there were “forced” closures of several establishments in the first half of the fiscal year, revenue fell 54% to €336.9 million compared with €619.8 million the previous year. Specifically, there was a 48% drop in gaming revenue (-€115 million) while hotel revenue tumbled 62% (-€175 million).

During the first lockdown only the Hôtel de Paris and Monte-Carlo Bay Hotel & Resort remained partially open to accommodate mainly permanent guests, but the occupancy rates were low. It was only from June 2 that restaurants and casinos were allowed to reopen but their opening times were reduced again from November 1, following a succession of government restrictions.

Rental revenue, however, was up +11% by €10 million. The rental sector, which combines boutiques and office leasing together with the activities of Monte-Carlo Bay, Balmoral, Villas du Sporting and One Monte-Carlo, reported revenue of €106.2 million, primarily the result of the gradual take-up of the residential leases at the One Monte-Carlo.

An operating loss of - €103.3 million compared to a profit of €22.6 million last year was also revealed along with a consolidated net loss of –€79.1 million (compared to a profit of €26.1 million) and a negative financial result of -€7 million. This includes results for Betclic Everest Group, an online gaming group of which SBM Group holds a 50% stake, with a share in net profit of €30.9 million compared with a positive contribution of €8.7 million the previous year.

“This variation is largely due to continued revenue growth despite the suspension of all sporting competitions at the beginning of the fiscal year as well as significantly reduced operating expenses. As a reminder, the last year results were impacted by a retroactive increase in taxes paid by Bet-At-Home,” the press release stated.

A cost of €7.5 million for the closure of the Sun Casino was also recorded in fiscal year 2020/2021. The Group has decided not to re-open it, and provision has been recorded for all of the outstanding financial commitments.

As a result of the biggest financial loss in the Group’s history, particularly with “the chronic losses recorded by its hotel and catering operations and casino sector, largely due to payroll expenses disproportionate to the revenues generated,” a restructuring plan to “drastically” reduced operating and investment expenses was announced on March 4.

Part of this plan includes the 234 employees over the age of 57 who have volunteered for redundancy on the condition that they will not be replaced. This represents a net charge of €25.3 million in the results for the last fiscal year

Despite a 37% year-on-year reduction in operating expenses (excluding depreciation and amortization and the restructuring plan), the SBM Group operating loss of €103.3 million is down €125.9 million from last year.

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Forbes MC Staff   Forbes Monaco