Econostrum | Economic News in the Mediterranean

Société des Bains de mer struggles to recover its pre-Covid-19 jackpot

Written by Eric Apim on Tuesday, June 7th 2022 à 10:35 | Read 571 times

The SBM is back in the black (photo: F.Dubessy)
The SBM is back in the black (photo: F.Dubessy)
MONACO. With a turnover of €530.5m achieved from 1 April 2021 to 31 March 2022, the Société des Bains de Mer et du Cercle des Etrangers à Monaco (SBM) has posted a 57% increase compared to the previous financial year 2020-2021. "This increase illustrates the resumption of activity despite a still unfavourable health context", emphasises a group press release published on Friday 3rd June 2022.

The activity of the first quarter was strongly impacted (April to June 2021) because of a Rolex Monte-Carlo Masters (tennis) behind closed doors and a Formula 1 Grand Prix with a gauge due to the pandemic. As well as the Christmas period with the arrival of the fifth wave.

Hotel revenue was the main contributor to this result (€213.3m compared with €109m), followed closely by gaming revenue (€200.8m compared with €124.3m).

Despite these good figures, SBM has not returned to its pre-Covid-19 health. Its turnover is still 14% lower than that achieved in 2019-2020. Its gaming turnover is down by 16%.
Similarly, although its operating profit has returned to a profit of €35.4m (compared to -€103.3m in the previous financial year), as has its net profit (€76.4m compared to -€79.1m), its financial results remain negative with a loss of €5.2m (-€7m in 2020-2021).

Cost optimisation

"In this crisis context, the S.B.M. Group has continued to work on optimising its costs in the 2021/2022 financial year by reducing operating expenses and better adapting costs to seasonal fluctuations," says SBM. A global restructuring plan (net charge of €25.3m in 2020-2021), in addition to the measures already put in place since the beginning of the health crisis, includes a staff restructuring plan initiated in March 2021. In particular, it was decided not to reopen the Sun Casino (€7.5m charge), which was closed at the height of the Covid-19 period.

The stake in the capital of the online gaming group Betclic Everest Group (BEG), which has been effective since May 2009, has been reduced, through dilution, from 50 to 47.3% at the end of 2021. This will result in a positive contribution to SBM's consolidated results of €46.2m this year, compared with €30.9m last year.

"The S.B.M. group announced the conclusion on 10 May 2022 of an agreement under the terms of which its subsidiary Monte-Carlo SBM International S.à.r.l. is committed to transferring, by way of a sale and contribution, its entire 47.30% stake in BEG to the Dutch company FL Entertainment N.V.", a press release stated. Due to be finalised on 30 June 2022, this transaction would value SBM International's share of BEG's capital at €850m, compared to a financial investment of €140m in 2009. It would also enable this SBM subsidiary to pursue its international development strategy.

The first two months of the 2022-2023 financial year confirm the trend observed over 2021-2022 with a gradual exit from the health crisis, which remains fragile. "The activity of the S.B.M. group thus remains dependent on the evolution of the epidemic as well as on the evolution of the conflict in Ukraine", assures the Monegasque company.


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