Fitch says SJM’s satellite casino closures pose limited credit risk

SJM Resorts’ plan to shut down seven of its nine satellite casinos by the end of 2025 will likely have a limited effect on its credit profile, Fitch Ratings said, even as the operator considers acquiring two of the properties outright.

The closures come in response to revised regulations in Macau requiring all satellite casinos—venues licensed by gaming concessionaires but operated by third parties—to either be fully owned by the licence holder or operate under non-revenue-sharing agreements starting in 2026.

Fitch said the restructuring was “unlikely to significantly impact” SJM’s financial health, describing the effect as “manageable” and projecting that the company’s EBITDA net leverage would decline to below five times by 2027.

The ratings agency maintained its BB- rating with a stable outlook on SJM’s long-term foreign-currency issuer default.

As part of the restructuring, SJM is seeking to acquire and operate Ponte 16 and L’Arc Macau—two of the nine satellite casinos it currently licenses—pending government approval. While Fitch flagged that the acquisitions could have a “moderate negative impact” on SJM’s leverage due to potential debt funding, it said this would likely be offset by additional EBITDA contributions from the properties.

“The EBITDA impact will be subject to SJM’s ability to capture market share with the additional tables at its self-operated casinos,” Fitch noted.

SJM is expected to transfer approximately 300 gaming tables and 4,000 staff from the shuttered satellites to its directly managed casinos, including Grand Lisboa and Grand Lisboa Palace. Fitch said this reallocation would be “broadly neutral” in EBITDA terms, assuming the company maintains its market position.

Still, other analysts were more cautious. Morgan Stanley said: “Gross gaming revenue from SJM satellite casinos of HKD2.8 billion [$356.7 million] in the first quarter of 2025 (5% of the industry) could leak to other [Macau] peninsula casinos.”

JP Morgan Securities flagged potential cost pressure from retaining all existing staff from the shuttered venues, cautioning it could result in “losses from wage burdens.”

“There is a possibility that more tables could lead to a dilution in table utilisation,” Citigroup said.

The revised gaming law mandates that all 11 of Macau’s satellite casinos must close by the end of 2025 unless they meet the new ownership or management criteria. Nine of those properties are licensed by SJM, with the remaining two operated under Galaxy and Melco licenses.