SBM : Good Financial Results

The gaming company posted record sales of over €700 million and an operating income of €73.6 million. And it is investing in several new projects.
 "The 2024 Grand Prix was a vintage year. SBM's performance that weekend was on a par with Charles Leclerc's victory", confided Stéphane Valeri, after presenting a "record" 2023-2024 financial year, ending on 31 March at a press conference. SBM posted sales of €704 million, compared with €667 million for the 2022-2023 financial year (+6%), an operating income of €73.6 million and a positive net result of €103.9 million. (Last year's net result of €896 million was exceptional and linked to the sale of BetClic).

All three of SBM's main sectors of activity recorded growth (+6% for hotel revenues and +3% for gaming). Unsurprisingly, it was the rental sector that generated the strongest increase (9%), with an occupancy rate approaching 100%, making it "the Group's major source of operating income. This income rose from €83.7 million to €90.8 million". But SBM has lost money in the operational management of its casinos and restaurants. "We've lost €5 million in casino operations and €18 million in hotel and restaurant operations in this 2023-2024 financial year."

"Our payroll is much higher than that of our competitors".
While prices in SBM hotels have been revised upwards by 8% in 2024 (and should also be in 2025), the group assumes that its results are impacted by operating expenses. "Our wage bill is much higher than that of our restaurant competitors, with salaries much higher than those in comparable professions in restaurants on the Côte d'Azur, in France, in Europe and around the world. We're sticking to this policy, but it takes its toll", observes the CEO, with figures to prove it. In concrete terms, SBM's employment model is based on "a 13th month, transport bonuses, as well as a Grand Prix bonus of 100 euros per day worked. There are no salaries below €2,000 gross per month in our establishments", asserted Stéphane Valeri, announcing a new bonus of around €2,000 gross following the group's good results. This means a bonus of €400 for salaries below €2,200 gross, and €200 for salaries between €2,200 and €2,500 gross.

Seeking economies of scale
The creation of two new departments within the Executive Committee (international development and property development), the renovation of the Monte-Carlo Bay and the Hermitage hotel over 5 years, the acquisition of the Palace des Neiges in Courchevel, the launch of a restaurant in Dubai in 2025 in partnership with the D.ream International group... SBM is also investing for the future. SBM is also bidding to rebuild and operate Le Méridien.

So how does it plan to make savings? We're going to improve the bottom line by buying better. We can buy the same quality at lower prices. It is precisely to make all SBM restaurants "profitable" that a new Food and Beverage division has been created for the whole Group. On the gaming side, as well as targeting a new clientele - particularly American - SBM has changed its policy on lending and collection of outstanding debts. Because the context is complicated. "International compliance rules are becoming increasingly stringent. We've had to turn down some very, very big customers, which is never easy for a business, because they no longer meet the standards we can accept when we don't have an absolute guarantee of the source of their funds. We're talking about customers from Eastern Europe and the Middle East. As we are very concerned to comply with international standards and to be beyond reproach in this respect, we've been deprived of several tens of millions of euros in sales, which we had in previous years", said Stéphane Valeri.