Moody’s Ratings says it expects SJM Holdings Ltd and its Macau-based subsidiary SJM Resorts S.A. to generate only modest earnings growth through the remainder of 2026 and into 2027 – primarily due to the contribution of recently acquired Casino L’Arc and gradual earnings accretion from tables reallocated from former satellite casinos.
Debt is also expected to decline moderately from next year onwards.
According to Moody’s, the group’s reorganization should see Adjusted EBITDA grow from HK$3.4 billion (US$434 million) in 2025 to HK$4.1 billion (US$524 million) this year and HK$4.5 billion (US$575 million) in 2027. Likewise, SJM’s adjusted debt/EBITDA is seen improving from 9.0x in 2025 to around 7.3x in 2026 and to 6.3x in 2027.
Nevertheless, Moody’s has downgraded SJM Holdings’ corporate family rating (CFR) to B1 from Ba3, and the backed senior unsecured rating on bonds issued by subsidiaries from B1 to B2. The outlook has improved from negative to stable.
“The downgrade reflects our anticipation that SJM’s earnings growth will only be gradual over the next 12 to 18 months,” said Stephanie Lau, a Moody’s Ratings Vice President and Senior Credit Officer.
“Consequently, while we expect its financial leverage to improve from a very high level in 2025, it will likely remain elevated.”
The ratings agency explained that SJM’s B1 CFR reflects its long-standing presence in Macau’s gaming market and the city’s favorable long-term growth outlook. It also captures its geographic concentration in Macau and intense competition, as well as its high financial leverage, Moody’s said.
