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What changed in STUDIO CITY INTERNATIONAL HOLDINGS Ltd's 20-F — 2023 vs 2024

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Paragraph-level year-over-year comparison of STUDIO CITY INTERNATIONAL HOLDINGS Ltd's 2023 and 2024 20-F annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+654 added−676 removedSource: 20-F (2025-03-21) vs 20-F (2024-03-22)

Top changes in STUDIO CITY INTERNATIONAL HOLDINGS Ltd's 2024 20-F

654 paragraphs added · 676 removed · 566 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

2 edited+0 added−0 removed0 unchanged
Biggest changeHISTORY AND DEVELOPMENT OF THE COMPANY 63 B. BUSINESS OVERVIEW 64 C. ORGANIZATIONAL STRUCTURE 91 D. PROPERTY, PLANT AND EQUIPMENT 92
Biggest changeHISTORY AND DEVELOPMENT OF THE COMPANY 62 B. BUSINESS OVERVIEW 63 C. ORGANIZATIONAL STRUCTURE 90 D. PROPERTY, PLANT AND EQUIPMENT 91
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 9 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 9 ITEM 3. KEY INFORMATION 10 A. [RESERVED] 12 B. CAPITALIZATION AND INDEBTEDNESS 12 C. REASONS FOR THE OFFER AND USE OF PROCEEDS 12 D. RISK FACTORS 13 ITEM 4. INFORMATION ON THE COMPANY 63 A.
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 9 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 9 ITEM 3. KEY INFORMATION 10 A. [RESERVED] 12 B. CAPITALIZATION AND INDEBTEDNESS 12 C. REASONS FOR THE OFFER AND USE OF PROCEEDS 12 D. RISK FACTORS 13 ITEM 4. INFORMATION ON THE COMPANY 62 A.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

288 edited+26 added−41 removed401 unchanged
Biggest changeWe cannot assure you that we will be financially successful in our non-gaming offerings or be able to maintain the average daily rate, occupancy rate and REVPAR of Studio City hotel or visitation to Studio City in general, which may adversely affect our ability to generate the cash flows that we anticipate and impact our operations and financial condition.
Biggest changeWe cannot assure you that we will be financially successful in our non-gaming offerings or be able to maintain the average daily rate, occupancy rate and REVPAR of Studio City Hotel or visitation to Studio City in general, which may adversely affect our ability to generate the cash flows that we anticipate and impact our operations and financial condition. 23 Table of Contents Studio City Casino’s gaming operations could be impacted by the reputation and integrity of the parties engaged in business activities at Studio City Casino and we cannot assure you that these parties will always maintain high standards of conduct or suitability throughout the term of Studio City Casino’s association with them.
As a result, the trading prices of our ADSs and ordinary shares could significantly decline or become worthless.
As a result, the trading prices of our ADSs and ordinary shares could significantly decline or become worthless.
As a result, until such time as the PCAOB issues any new determination, we do not believe we are at risk of being a Commission-Identified Issuer nor at risk of having our securities subject to a trading prohibition under the HFCAA.
As a result, until such time as the PCAOB issues any new determination, we do not believe we are at risk of being a Commission-Identified Issuer nor at risk of having our securities subject to a trading prohibition under the HFCAA.
See “Item 4. Information on the Company — B.
See “Item 4. Information on the Company — B.
There remains significant uncertainty as to the enactment, interpretation and implementation of regulatory requirements related to overseas securities offerings and other capital markets activities.
There remains significant uncertainty as to the enactment, interpretation and implementation of regulatory requirements related to overseas securities offerings and other capital markets activities.
Consolidated Statements and Other Financial Information — Dividend Policy.” There are no regulatory or foreign exchange restrictions or limitations on our ability to transfer cash within our corporate group or to declare dividends to holders of our ADSs, except that our subsidiaries incorporated in Macau are required to set aside a specified amount of the entity’s profit after tax as a legal reserve which is not distributable to the shareholders of such subsidiaries.
Consolidated Statements and Other Financial Information — Dividend Policy.” There are no regulatory or foreign exchange restrictions or limitations on our ability to transfer cash within our corporate group or to declare dividends to holders of our ADSs, except that our subsidiaries incorporated in Macau are required to set aside a specified amount of the entity’s profit after tax as a legal reserve which is not distributable to the shareholders of such subsidiaries.
See “Item 4. Information on the Company — B. Business Overview — Regulations — Restrictions on Distribution of Profits Regulations” and “Item 10. Additional Information — D.
See “Item 4. Information on the Company — B. Business Overview — Regulations — Restrictions on Distribution of Profits Regulations” and “Item 10. Additional Information — D.
Exchange Controls.” We currently intend to retain most, if not all, of our available funds and any future earnings to repay or refinance our debt, fund our ongoing operations and fund the development and growth of our business. As a result, we do not expect to pay any cash dividends in the foreseeable future. See “Item 8.
Exchange Controls.” We currently intend to retain most, if not all, of our available funds and any future earnings to repay or refinance our debt, fund our ongoing operations and fund the development and growth of our business. As a result, we do not expect to pay any cash dividends in the foreseeable future. See “Item 8.
Furthermore, Melco Resorts, as well as the Gaming Operator, may take action to construct and operate new gaming projects or invest in such projects, located in other countries in the Asia region (including new gaming projects in Macau) or outside the Asia region, which, along with their current operations, such as Altira Macau and City of Dreams, may increase the competition Studio City Casino will face.
Furthermore, Melco Resorts, as well as the Gaming Operator, may take action to construct and operate new gaming projects or invest in such projects, located in other countries in the Asia region (including new gaming projects in Macau) or outside the Asia region, which, along with their current operations, such as City of Dreams and Altira Macau, may increase the competition Studio City Casino will face.
Our activities in Macau are subject to administrative review and approval by various departments of the Macau government. For example, our business activities and Studio City Casino are subject to the administrative review and approval by the DICJ, Macau health department, Macau labor bureau, Macau construction works bureau, Macau fire department, Macau finance department and Macau government tourism office.
Our activities in Macau are subject to administrative review and approval by various departments of the Macau government. For example, our business activities and Studio City Casino are subject to the administrative review and approval by the DICJ, Macau Health Bureau, Macau Labor Bureau, Macau Construction Works Bureau, Macau Fire Department, Macau Finance Department and Macau Government Tourism Office.
Our directors have discretion under our articles of association to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders.
Our directors have discretion under our articles of association to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders.
This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.
This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.
See “— Risks Relating to Our Business — Failure to protect the integrity and security of company staff, supplier and customer information and comply with cybersecurity, data privacy, data protection or any other laws and regulations related to data may materially and adversely affect our business, financial condition and results of operations, and/or result in damage to reputation and/or subject us to fines, penalties, lawsuits, restrictions on our use or transfer of data and other risks” and “— Claims or regulatory actions against us under China’s competition laws may result in fines, constraints on our business and damage to our reputation.” These laws and regulations can be complex and stringent, and many are subject to change and uncertain interpretations, which could result in claims, changes to our data and other business practices, regulatory investigations, penalties, increased cost of operations, or declines in customer growth or engagement, or otherwise affect our business.
See “— Risks Relating to Our Business — Failure to protect the integrity and security of company staff, supplier and customer information and comply with cybersecurity, data privacy, data protection or any other laws and regulations related to data may materially and adversely affect our business, financial condition and results of operations, and/or result in damage to reputation and/or subject us to fines, penalties, lawsuits, restrictions on our use or transfer of data and other risks” and “— Claims or regulatory actions against us under mainland China’s competition laws may result in fines, constraints on our business and damage to our reputation.” These laws and regulations can be complex and stringent, and many are subject to change and uncertain interpretations, which could result in claims, changes to our data and other business practices, regulatory investigations, penalties, increased cost of operations, or declines in customer growth or engagement, or otherwise affect our business.
See “— Risks Relating to Our Business — Failure to protect the integrity and security of company staff, supplier and customer information and comply with cybersecurity, data privacy, data protection or any other laws and regulations related to data may materially and adversely affect our business, financial condition and results of operations, and/or result in damage to reputation and/or subject us to fines, penalties, lawsuits, restrictions on our use or transfer of data and other risks” and “— Claims or regulatory actions against us under China’s competition laws may result in fines, constraints on our business and damage to our reputation.” These laws and regulations can be complex and stringent, and many are subject to change and uncertain interpretations, which could result in claims, changes to our data and other business practices, regulatory investigations, penalties, increased cost of operations, or declines in customer growth or engagement, or otherwise affect our business.
See “— Risks Relating to Our Business — Failure to protect the integrity and security of company staff, supplier and customer information and comply with cybersecurity, data privacy, data protection or any other laws and regulations related to data may materially and adversely affect our business, financial condition and results of operations, and/or result in damage to reputation and/or subject us to fines, penalties, lawsuits, restrictions on our use or transfer of data and other risks” and “— Claims or regulatory actions against us under mainland China’s competition laws may result in fines, constraints on our business and damage to our reputation.” These laws and regulations can be complex and stringent, and many are subject to change and uncertain interpretations, which could result in claims, changes to our data and other business practices, regulatory investigations, penalties, increased cost of operations, or declines in customer growth or engagement, or otherwise affect our business.
In addition, the PRC government’s ongoing anti-corruption campaign has led to tighter monetary transfer regulations, including real-time monitoring of certain financial channels, reducing the amount that PRC-issued ATM cardholders can withdraw in each withdrawal, imposing a limit on the annual aggregate amount that may be withdrawn and the launch of facial recognition and identity card checks with respect to certain ATM users, which could disrupt the amount of money visitors can bring from mainland China to Macau.
In addition, the mainland China government’s ongoing anti-corruption campaign has led to tighter monetary transfer regulations, including real-time monitoring of certain financial channels, reducing the amount that mainland China-issued ATM cardholders can withdraw in each withdrawal, imposing a limit on the annual aggregate amount that may be withdrawn and the launch of facial recognition and identity card checks with respect to certain ATM users, which could disrupt the amount of money visitors can bring from mainland China to Macau.
The PRC Personal Information Protection Law, which was promulgated by the Standing Committee of the National People’s Congress on August 20, 2021 and took effect on November 1, 2021, integrates the various rules with respect to personal information rights and privacy protection and applies to the processing of personal information within mainland China as well as certain personal information processing activities outside mainland China, including those for the provision of products and services to natural persons within the PRC or for the analysis and assessment of acts of natural persons within the PRC.
The mainland China Personal Information Protection Law, which was promulgated by the Standing Committee of the National People’s Congress on August 20, 2021 and took effect on November 1, 2021, integrates the various rules with respect to personal information rights and privacy protection and applies to the processing of personal information within mainland China as well as certain personal information processing activities outside mainland China, including those for the provision of products and services to natural persons within mainland China or for the analysis and assessment of acts of natural persons within mainland China.
These regulatory agencies may impose fines and penalties on us, limit our operations, limit our ability to pay dividends outside of China, limit our ability to list on stock exchanges outside of China or offer our securities to foreign investors or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities.
These regulatory agencies may impose fines and penalties on us, limit our operations, limit our ability to pay dividends outside of mainland China, limit our ability to list on stock exchanges outside of mainland China or offer our securities to foreign investors or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities.
These regulatory agencies may impose fines and penalties on us, limit our operations, limit our ability to pay dividends outside of China, limit our ability to list on stock exchanges outside of China or offer our securities to foreign investors or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities.
These regulatory agencies may impose fines and penalties on us, limit our operations, limit our ability to pay dividends outside of mainland China, limit our ability to list on stock exchanges outside of mainland China or offer our securities to foreign investors or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities.
For example: • if Studio City is not operating with certain minimum requirements as specified in the 2028 Studio City Senior Secured Credit Facility, or if we fail to meet our payment obligations or otherwise default under the agreements governing our existing indebtedness, including due to any termination or any substantial or adverse amendment of the terms of the Studio City Casino Agreement, the applicable lenders or note holders under our indebtedness will have the right to accelerate such indebtedness and exercise other rights and remedies against us; • we may be limited in our ability to obtain additional financing, if needed, to fund our working capital requirements, capital expenditures, debt service, general corporate or other obligations, including our obligations with respect to the existing indebtedness; • we are required to use all or a substantial portion of our cash flow from operations of Studio City to service our indebtedness, which will reduce the available cash flow to fund our operations, capital expenditures and other general corporate purposes; • we may be limited in our ability to respond to changing business and economic conditions, including regulatory changes, and to withstand competitive pressures, which may affect our financial condition; • under certain existing indebtedness, the interest rates we pay in respect of the indebtedness which we are not required to hedge will fluctuate with the current market rates and, accordingly, our interest expense will increase if market interest rates increase; • we may be placed at a competitive disadvantage to our competitors who are not as highly leveraged; and • in the event that we or one of our subsidiaries were to default, it may result in the loss of all or a substantial portion of our and/or our subsidiaries’ assets over which our creditors have taken or will take security.
For example: • if Studio City is not operating with certain minimum requirements as specified in the 2021 Studio City Senior Secured Credit Facility and the 2024 Studio City Senior Secured Credit Facility, or if we fail to meet our payment obligations or otherwise default under the agreements governing our existing indebtedness, including due to any termination or any substantial or adverse amendment of the terms of the Studio City Casino Agreement, the applicable lenders or note holders under our indebtedness will have the right to accelerate such indebtedness and exercise other rights and remedies against us; • we may be limited in our ability to obtain additional financing, if needed, to fund our working capital requirements, capital expenditures, debt service, general corporate or other obligations, including our obligations with respect to the existing indebtedness; • we may use all or a substantial portion of our cash flow from operations of Studio City to service our indebtedness, which will reduce the available cash flow to fund our operations, capital expenditures and other general corporate purposes; • we may be limited in our ability to respond to changing business and economic conditions, including regulatory changes, and to withstand competitive pressures, which may affect our financial condition; • under certain existing indebtedness, the interest rates we pay in respect of the indebtedness which we are not required to hedge will fluctuate with the current market rates and, accordingly, our interest expense will increase if market interest rates increase; • we may be placed at a competitive disadvantage to our competitors who are not as highly leveraged; and • in the event that we or one of our subsidiaries were to default, it may result in the loss of all or a substantial portion of our and/or our subsidiaries’ assets over which our creditors have taken or will take security.
These regulatory agencies may impose fines and penalties on us, limit our operations, limit our ability to list on stock exchanges outside of China or offer our securities to foreign investors or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities.
These regulatory agencies may impose fines and penalties on us, limit our operations, limit our ability to list on stock exchanges outside of mainland China or offer our securities to foreign investors or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities.
If, upon termination of the Gaming Operator’s concession, or under the new gaming law, Studio City Entertainment were not able to continue the same arrangements or enter into similar arrangements, Studio City Casino may not be able to continue to operate in the same manner or at all, and the casino and gaming equipment operated by the Gaming Operator under its concession will revert or be transferred to the Macau government without compensation.
If, upon termination of the Gaming Operator’s concession, or under the gaming law, Studio City Entertainment were not able to continue the same arrangements or enter into similar arrangements, Studio City Casino may not be able to continue to operate in the same manner or at all, and the casino and gaming equipment operated by the Gaming Operator under its concession will revert or be transferred to the Macau government without compensation.
In addition, rules and regulations in China can change quickly with little advance notice. Uncertainties due to evolving laws and regulations could impede our ability to obtain or maintain certificates, permits or licenses required to conduct business in China. In the absence of required certificates, permits or licenses, governmental authorities could impose material sanctions or penalties on us.
In addition, rules and regulations in mainland China can change quickly with little advance notice. Uncertainties due to evolving laws and regulations could impede our ability to obtain or maintain certificates, permits or licenses required to conduct business in mainland China. In the absence of required certificates, permits or licenses, governmental authorities could impose material sanctions or penalties on us.
In addition, rules and regulations in China can change quickly with little advance notice. Uncertainties due to evolving laws and regulations could impede our ability to obtain or maintain certificates, permits or licenses required to conduct business in China. In the absence of required certificates, permits or licenses, governmental authorities could impose material sanctions or penalties on us.
In addition, rules and regulations in mainland China can change quickly with little advance notice. Uncertainties due to evolving laws and regulations could impede our ability to obtain or maintain certificates, permits or licenses required to conduct business in mainland China. In the absence of required certificates, permits or licenses, governmental authorities could impose material sanctions or penalties on us.
The Gaming Operator also needs to first obtain the approval of the Macau governmental authorities before raising certain financing and must notify the Macau government before taking certain financial decisions. The Gaming Operator’s ability to incur indebtedness or raise equity may be further restricted by its existing and any future financings.
The Gaming Operator also needs to first obtain the approval of the Macau governmental authorities before raising certain financing and must notify the Macau government before taking significant financial decisions. The Gaming Operator’s ability to incur indebtedness or raise equity may be further restricted by its existing and any future financings.
Both visitation and the level of spending at our themed attractions, hotel, retail shops, restaurants and other leisure and entertainment facilities are key drivers of revenues and profitability, and reductions in either could have a material adverse effect on our business, prospects, results of operations and cash flows.
Both visitation and the level of spending at our themed attractions, hotel towers, retail shops, restaurants and other leisure and entertainment facilities are key drivers of revenues and profitability, and reductions in either could have a material adverse effect on our business, prospects, results of operations and cash flows.
These PRC technology conglomerates manufacture and/or develop telecommunications and other equipment, software, mobile Apps and devices that are popular and widely used globally, including by us and by our customers, especially those in mainland China.
These mainland China technology conglomerates manufacture and/or develop telecommunications and other equipment, software, mobile Apps and devices that are popular and widely used globally, including by us and by our customers, especially those in mainland China.
A significant theft, loss or fraudulent use of customer or company data maintained by us or by a third-party service provider could have an adverse effect on our reputation, cause a material disruption to our operations and management team, and result in remediation 26 Table of Contents expenses, regulatory penalties and litigation by customers and other parties whose information was subject to such attacks, all of which could have a material adverse effect on our business, prospects, results of operations and cash flows.
A significant theft, loss or fraudulent use of customer or company data maintained by us or by a third-party service provider could have an adverse effect on our reputation, cause a material disruption to our operations and management team, and result in remediation 25 Table of Contents expenses, regulatory penalties and litigation by customers and other parties whose information was subject to such attacks, all of which could have a material adverse effect on our business, prospects, results of operations and cash flows.
We would, subject to market forces, expect there to be a close correlation in the price of our ADSs and the price of the Class A ordinary shares and any factors contributing to a decline in one market is likely to result to a similar decline in another. 57 Table of Contents The depositary for our ADSs will give us a discretionary proxy to vote our Class A ordinary shares underlying your ADSs if you do not vote at shareholders’ meetings, except in limited circumstances, which could adversely affect your interests.
We would, subject to market forces, expect there to be a close correlation in the price of our ADSs and the price of the Class A ordinary shares and any factors contributing to a decline in one market is likely to result to a similar decline in another. 56 Table of Contents The depositary for our ADSs will give us a discretionary proxy to vote our Class A ordinary shares underlying your ADSs if you do not vote at shareholders’ meetings, except in limited circumstances, which could adversely affect your interests.
If we fail to accurately identify the seasonal trends in our business and match our customer services and supplies in an effective manner, it may have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows. 25 Table of Contents Macau’s infrastructure may not adequately support the development of Macau’s gaming and leisure industry, which may adversely affect our expected performance.
If we fail to accurately identify the seasonal trends in our business and match our customer services and supplies in an effective manner, it may have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows. 24 Table of Contents Macau’s infrastructure may not adequately support the development of Macau’s gaming and leisure industry, which may adversely affect our expected performance.
Additionally, the Chinese government has in the past made statements indicating an intent to exert more oversight and control over offerings by China-based issuers that are conducted overseas and/or foreign investment in China-based issuers and any such action could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless.
Additionally, the mainland China government has in the past made statements indicating an intent to exert more oversight and control over offerings by mainland China-based issuers that are conducted overseas and/or foreign investment in mainland China-based issuers and any such action could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless.
Additionally, the Chinese government has in the past made statements indicating an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers and any such action could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless.
Additionally, the mainland China government has in the past made statements indicating an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers and any such action could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless.
Furthermore, in connection with our issuance of securities to foreign investors, under current PRC laws, regulations and regulatory rules, as of the date of this annual report, we do not believe we are currently required to obtain permissions from or complete any filing with the China Securities Regulatory Commission, or CSRC, or required to go through cybersecurity review by the Cyberspace Administration of China, or CAC.
Furthermore, in connection with our issuance of securities to foreign investors, under current mainland China laws, regulations and regulatory rules, as of the date of this annual report, we do not believe we are currently required to obtain permissions from or complete any filing with the China Securities Regulatory Commission, or CSRC, or required to go through cybersecurity review by the Cyberspace Administration of China, or CAC.
Additionally, the Chinese government has in the past made statements indicating an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers and any such action could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless.
Additionally, the mainland China government has in the past made statements indicating an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers and any such action could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless.
In addition, the Participation Agreement, pursuant to which MSC Cotai granted the Participation Interest to New Cotai, provides that all disputes arising out of the Participation Agreement must be resolved through arbitration proceedings subject to certain limited exceptions and such provision will affect the manner by which New Cotai or any other parties to the Participation Agreement may pursue any claim or action arising out 55 Table of Contents of the Participation Agreement.
In addition, the Participation Agreement, pursuant to which MSC Cotai granted the Participation Interest to New Cotai, provides that all disputes arising out of the Participation Agreement must be resolved 54 Table of Contents through arbitration proceedings subject to certain limited exceptions and such provision will affect the manner by which New Cotai or any other parties to the Participation Agreement may pursue any claim or action arising out of the Participation Agreement.
These short attacks have, in the past, led to selling of shares in the market. Public companies that have substantially all of their operations in Greater China have been the subject of short selling.
These short attacks have, in the past, led to selling of shares in the market. Public companies that have substantially all of their operations in China have been the subject of short selling.
The depositary may refuse to deliver, transfer or register transfers of our ADSs 58 Table of Contents generally when our share register or the books of the depositary are closed, or at any time if we deem or the depositary deems it advisable to do so because of any requirement of law or of any government or governmental body, or under any provision of the deposit agreement, or for any other reason.
The depositary may refuse to deliver, transfer or register transfers of our ADSs 57 Table of Contents generally when our share register or the books of the depositary are closed, or at any time if we deem or the depositary deems it advisable to do so because of any requirement of law or of any government or governmental body, or under any provision of the deposit agreement, or for any other reason.
We have a short business operating history compared to many of our competitors, and there is limited historical information available about us upon which you can base your evaluation of our business and prospects. Studio City commenced operations in October 2015 and Phase 2 progressively opened in April and September of 2023.
We have a short business operating history for our full operations compared to many of our competitors, and there is limited historical information available about us upon which you can base your evaluation of our business and prospects. Studio City commenced operations in October 2015 and Phase 2 progressively opened in April and September of 2023.
While we and our affiliated companies have adopted and implemented an anti-corruption compliance program covering both commercial bribery and public corruption which includes internal policies, procedures and training aimed to prevent and detect anti-corruption compliance issues and risks, and procedures to take remedial action when compliance issues are identified, we cannot assure you that our employees, consultants, contractors and agents, and those of our affiliates, will adhere to the anti-corruption compliance program, or that any action taken to comply with, or address compliance issues, will be considered adequate by the regulatory bodies with jurisdiction over us and our affiliates.
While we and our affiliated companies have adopted and implemented an anti-corruption compliance program covering both commercial bribery and public corruption which includes internal policies, procedures 32 Table of Contents and training aimed to prevent and detect anti-corruption compliance issues and risks, and procedures to take remedial action when compliance issues are identified, we cannot assure you that our employees, consultants, contractors and agents, and those of our affiliates, will adhere to the anti-corruption compliance program, or that any action taken to comply with, or address compliance issues, will be considered adequate by the regulatory bodies with jurisdiction over us and our affiliates.
Tensions between the United States and China have continued to escalate in connection with ongoing trade disputes as well as other political factors.
Tensions between the United States and mainland China have continued to escalate in connection with ongoing trade disputes as well as other political factors.
On August 16, 2022, we changed our auditor from Ernst & Young, located in Hong Kong, to Ernst & Young LLP, located in Singapore, which is not a PCAOB-Identified Firm. In December 2022, the PCAOB announced that it secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong.
On August 16, 2022, we changed our auditor from Ernst & Young, located in Hong Kong, to Ernst & Young LLP, located in Singapore, which was not a PCAOB-Identified Firm. In December 2022, the PCAOB announced that it secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong.
On August 16, 2022, we changed our auditor from Ernst & Young, located in Hong Kong, to Ernst & Young LLP, located in Singapore, which is not a PCAOB-Identified Firm. In December 2022, the PCAOB announced that it secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong.
On August 16, 2022, we changed our auditor from Ernst & Young, located in Hong Kong, to Ernst & Young LLP, located in Singapore, which was not a PCAOB-Identified Firm. In December 2022, the PCAOB announced that it secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong.
Press releases relating to financial results and 59 Table of Contents material events will be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers.
Press releases relating to financial results and 58 Table of Contents material events will be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers.
While we expect that the Gaming Operator will operate Studio City Casino in compliance in all material respects with all applicable laws and regulations of Macau, these laws and regulations are complex and a court or an administrative or regulatory body may in the future render an interpretation of these laws and regulations or issue new or modified regulations that differ from our or the Gaming Operator’s interpretation, which could have a material adverse effect on the operation of Studio City Casino and on our financial condition, results of operations, cash flows and prospects.
While we expect that the Gaming Operator will operate Studio City Casino in compliance in all material respects with all applicable laws and regulations of Macau, these laws and regulations are complex and a court or an administrative or regulatory body may in the future render an interpretation of these laws and regulations or issue new or modified regulations that differ from our or the Gaming Operator’s interpretation, 38 Table of Contents which could have a material adverse effect on the operation of Studio City Casino and on our financial condition, results of operations, cash flows and prospects.
Furthermore, the PRC has tightened currency exchange controls and restrictions on the export and conversion of the Renminbi, the currency of mainland China, in recent years.
Furthermore, mainland China has tightened currency exchange controls and restrictions on the export and conversion of the Renminbi, the currency of mainland China, in recent years.
See also “— Risks Relating to Our Business — Failure to protect the integrity and security of company staff, supplier and customer information and comply with cybersecurity, data privacy, data protection or any other laws and regulations related to data may materially and adversely affect our business, financial condition and results of operations, and/or result in damage to reputation and/or subject us to fines, penalties, lawsuits, restrictions on our use or transfer of data and other risks” for discussions relating to the PRC Data Security Law.
See also “— Risks Relating to Our Business — Failure to protect the integrity and security of company staff, supplier and customer information and comply with cybersecurity, data privacy, data protection or any other laws and regulations related to data may materially and adversely affect our business, financial condition and results of operations, and/or result in damage to reputation and/or subject us to fines, penalties, lawsuits, restrictions on our use or transfer of data and other risks” for discussions relating to the mainland China Data Security Law.
These changes, when enacted, by various countries in which we do business may increase our taxes in these countries. The foregoing tax changes and other possible future tax changes may have an adverse impact on us, our business, financial condition, results of operations and cash flow. 62 Table of Contents
These changes, when enacted, by various countries in which we do business may increase our taxes in these countries in the future. The foregoing tax changes and other possible future tax changes may have an adverse impact on us, our business, financial condition, results of operations and cash flow. 61 Table of Contents
Under the Gaming Operator’s concession, the Macau government is allowed to request various changes in its investment plans and to make various other decisions and determinations. The law amending the gaming law also grants the Macau government authority to require for changes and specifications to be made to properties operated by concessionaires, including the Gaming Operator.
Under the Gaming Operator’s concession, the Macau government is allowed to request various changes in its investment plans and to make various other decisions and determinations. The Macau Gaming Operations Law also grants the Macau government authority to require for changes and specifications to be made to properties operated by concessionaires, including the Gaming Operator.
Under the first paragraph of Article 15 of the Trial Administrative New Measures, overseas offerings and listings of a listing applicant by a PRC company must conduct and complete the relevant filing procedures with the CSRC if (i) more than 50% of its operating revenue, total profit, total assets or net assets were derived from its PRC entities based on the audited consolidated financial statements for the most recent financial year, and (ii) the main parts of its business activities are conducted in the PRC, its principal places of business are located in the PRC, or the majority of senior management in charge of its business operations are Chinese citizens or domiciled in the PRC.
Under the first paragraph of Article 15 of the Trial Administrative New Measures, overseas offerings and listings of a listing applicant by a mainland China company must conduct and complete the relevant filing procedures with the CSRC if (i) more than 50% of its operating revenue, total profit, total assets or net assets were derived from its mainland China entities based on the audited consolidated financial statements for the most recent financial year, and (ii) the main parts of its business activities are conducted in the mainland China, its principal places of business are located in mainland China, or the majority of senior management in charge of its business operations are mainland China citizens or domiciled in mainland China.
While these arrangements were entered into at pre-agreed rates that we believe are commercially reasonable, the determination of such commercial terms were subject 42 Table of Contents to judgment and estimates and we may have obtained different terms for similar types of services had we entered into such arrangements with independent third parties or had we not been a subsidiary of Melco Resorts. • Our Board Members and Executive Officers May Have Conflicts of Interest .
While these arrangements were entered into at pre-agreed rates that we believe are commercially reasonable, the determination of such commercial terms were subject to judgment and estimates and we may have obtained different terms for similar types of services had we entered into such arrangements with independent third parties or had we not been a subsidiary of Melco Resorts. • Our Board Members and Executive Officers May Have Conflicts of Interest .
In addition, the number of patrons visiting Studio City may be affected by the PRC government’s focus on deterring marketing of gaming to mainland Chinese citizens and its initiatives to tighten monetary transfer regulations, increase monitoring of various transactions, including bank or credit card transactions, reduce the amount that PRC-issued ATM cardholders can withdraw in each withdrawal and impose a limit on the annual aggregate amount that may be withdrawn.
In addition, the number of patrons visiting Studio City may be affected by the mainland China government’s focus on deterring marketing of gaming to mainland China citizens and its initiatives to tighten monetary transfer regulations, increase monitoring of various transactions, including bank or credit card transactions, reduce the amount that mainland China-issued ATM cardholders can withdraw in each withdrawal and impose a limit on the annual aggregate amount that may be withdrawn.
The PRC government has also developed its digital currency and has performed certain test trials in its application within mainland China.
The mainland China government has also developed its digital currency and has performed certain test trials in its application within mainland China.
Such regulations and guidance are potentially subject to different 61 Table of Contents interpretations. If due to different interpretations of such regulations and guidance the percentage of our passive income or the percentage of our assets treated as producing passive income increases, we may be a PFIC in one or more taxable years.
Such regulations and guidance are potentially subject to different interpretations. If due to different interpretations of such regulations 60 Table of Contents and guidance the percentage of our passive income or the percentage of our assets treated as producing passive income increases, we may be a PFIC in one or more taxable years.
If a United States person is treated as owning (directly, indirectly or constructively) at least 10% of the value or voting power of our stock (including our ordinary shares and ADSs), such person may be treated as a “United States shareholder” with respect to us.
If a “United States person” is treated as owning (directly, indirectly or constructively) at least 10% of the value or voting power of our stock (including our ordinary shares and ADSs), such person may be treated as a “United States shareholder” with respect to us.
All gaming activities at Studio City Casino’s table games are conducted exclusively with gaming chips which are subject to the risk of alteration and counterfeiting. The Gaming Operator has incorporated a variety of security and anti-counterfeit features to detect altered or counterfeit gaming chips.
All gaming activities at Studio City Casino’s table games are conducted exclusively with gaming chips which are subject to the risk of alteration and counterfeiting. The 39 Table of Contents Gaming Operator has incorporated a variety of security and anti-counterfeit features to detect altered or counterfeit gaming chips.
In particular, due to credit conditions in the PRC and the tightening of cross-border fund transfers by the PRC government to control capital outflows in recent years, the number of visitors to Macau from the PRC, as well as the amounts they are willing to spend in casinos, may decrease, which could have a material adverse effect on our business, financial condition and results of operations. • Inability to Control Win Rates.
In particular, due to credit conditions in mainland China and the tightening of cross-border fund transfers by the mainland China government to control capital outflows in recent years, the number of visitors to Macau from mainland China, as well as the amounts they are willing to spend in casinos, may decrease, which could have a material adverse effect on our business, financial condition and results of operations. • Inability to Control Win Rates.
In addition, on November 1, 2023, the PRC National Information Security Standardization Technical Committee issued the Network Security Standard Practice Guide –Guangdong-Hong Kong-Macau Greater Bay Area Cross-Border Personal Information Protection Requirements (Draft for Comment), setting out the basic principles and protection requirements in the personal information cross-border flow in the Guangdong-Hong Kong-Macao Greater Bay Area, which requires personal information processors to comply with the local laws and regulations in the jurisdictions concerned.
In addition, on November 1, 2023, the mainland China National Information Security Standardization Technical Committee issued the Network Security Standard Practice Guide –Guangdong-Hong Kong-Macau Greater Bay Area Cross-Border Personal Information Protection Requirements (Draft for Comment), setting out the basic principles and protection requirements in the personal information cross-border flow in the Guangdong-Hong Kong-Macao Greater Bay Area, which requires personal information processors to comply with the local laws and regulations in the jurisdictions concerned.
Furthermore, the Macau government has launched identity card checks with respect to certain ATM users and recommended banks perform adequate due diligence and monitoring of merchants with respect to usage of point-of-sales machines, such as cash registers where a customer is charged for goods or services purchased. These measures may limit liquidity availability and curb capital outflows.
Furthermore, the Macau government performs identity card checks with respect to certain ATM users and recommended banks perform adequate due diligence and monitoring of merchants with respect to usage of point-of-sales machines, such as cash registers where a customer is charged for goods or services purchased. These measures may limit liquidity availability and curb capital outflows.
The PRC may also enact new PRC laws, rules or regulations which may influence our operations in Macau or elsewhere at any time as the PRC government deems appropriate to further regulatory, political and societal goals, or may exert more control over offerings conducted overseas and/or foreign investment in PRC-based issuers, which could result in a material change in our operations and/or the value of our ordinary shares.
The mainland China government may also enact new laws, rules or regulations which may influence our operations in Macau or elsewhere at any time as the mainland China government deems appropriate to further regulatory, political and societal goals, or may exert more control over offerings conducted overseas and/or foreign investment in mainland China-based issuers, which could result in a material change in our operations and/or the value of our ordinary shares.
For example, if COVID-19 outbreaks return and disrupt our operations or escalates, it may have a 51 Table of Contents material adverse effect on the availability of funds for MSC Cotai and its subsidiaries to distribute.
For example, if COVID-19 outbreaks return and disrupt our operations or escalates, it may have a 50 Table of Contents material adverse effect on the availability of funds for MSC Cotai and its subsidiaries to distribute.
If we are a PFIC for any taxable year during which a United States person holds ADSs, certain adverse United States federal income tax consequences could apply to such United States person. See “Item 10. Additional Information — E.
If we are a PFIC for any taxable year during which a “United States person” holds ADSs, certain adverse United States federal income tax consequences could apply to such United States person. See “Item 10. Additional Information — E.
Furthermore, the depreciation of RMB against U.S. dollar or H.K. dollar will affect the purchasing power of visitors from the PRC, which in turn may affect the visitation and level of spending at Studio City. To date we have not engaged in hedging transactions with respect to foreign exchange exposure of our revenues and expenses in our day-to-day operations.
Furthermore, the depreciation of RMB against U.S. dollar or H.K. dollar will affect the purchasing power of visitors from mainland China, which in turn may affect the visitation and level of spending at Studio City. To date we have not engaged in hedging transactions with respect to foreign exchange exposure of our revenues and expenses in our day-to-day operations.
If (i) we incorrectly conclude that certain regulatory permissions and approvals are not required or (ii) applicable laws, regulations, or interpretations change in a way that requires us to complete such filings or obtain such approvals in the future, and (iii) we are required to obtain such permissions or approvals in the future, but fail to receive or maintain such permissions or approvals, we may face sanctions by the CSRC, the CAC or other PRC regulatory agencies.
If (i) we incorrectly conclude that certain regulatory permissions and approvals are not required or (ii) applicable laws, regulations, or interpretations change in a way that requires us to complete such filings or obtain such approvals in the future, and (iii) we are required to obtain such permissions or approvals in the future, but fail to receive or maintain such permissions or approvals, we may face sanctions by the CSRC, the CAC or other mainland China regulatory agencies.
If (i) we incorrectly conclude that certain regulatory permissions and approvals are not required or (ii) applicable laws, regulations, or interpretations change in a way that requires us to complete such filings or obtain such approvals in the future, and (iii) we are required to obtain such permissions or approvals in the future, but fail to receive or maintain such permissions or approvals, we may face sanctions by the CSRC, the CAC or other PRC regulatory agencies.
If (i) we incorrectly conclude that certain regulatory permissions and approvals are not required or (ii) applicable laws, regulations, or interpretations change in a way that requires us to complete such filings or obtain such approvals in the future, and (iii) we are required to obtain such permissions or approvals in the future, but fail to receive or maintain such permissions or approvals, we may face sanctions by the CSRC, the CAC or other mainland China regulatory agencies.
In addition, the PRC Data Security Law, which was promulgated by the Standing Committee of the National People’s Congress on June 10, 2021 and took effect on September 1, 2021, requires data collection to be conducted in a legitimate and proper manner, and stipulates that, for the purpose of data protection, data processing activities must be conducted based on data classification and hierarchical protection systems for data security.
In addition, the mainland China Data Security Law, which was promulgated by the Standing Committee of the National People’s Congress on June 10, 2021 and took effect on September 1, 2021, requires data collection to be conducted in a legitimate and proper manner, and stipulates that, for the purpose of data protection, data processing activities must be conducted based on data classification and hierarchical protection systems for data security.
REASONS FOR THE OFFER AND USE OF PROCEEDS Not applicable. 12 Table of Contents D. RISK FACTORS Studio City International Holdings Limited is a company incorporated under the laws of the Cayman Islands. We are not a Chinese operating company but a Cayman Islands holding company with operations conducted by our subsidiaries in Macau, Hong Kong and Singapore.
REASONS FOR THE OFFER AND USE OF PROCEEDS Not applicable. 12 Table of Contents D. RISK FACTORS Studio City International Holdings Limited is a company incorporated under the laws of the Cayman Islands. We are not a mainland China operating company but a Cayman Islands holding company with operations conducted by our subsidiaries in Macau, Hong Kong and Singapore.
Furthermore, in connection with our issuance of securities to foreign investors, under current PRC laws, regulations and regulatory rules, as of the date of this annual report, we do not believe we are currently required to obtain permissions from or complete any filing with the CSRC or required to go through cybersecurity review by the CAC.
Furthermore, in connection with our issuance of securities to foreign investors, under current mainland China laws, regulations and regulatory rules, as of the date of this annual report, we do not believe we are currently required to obtain permissions from or complete any filing with the CSRC or required to go through cybersecurity review by the CAC.
Consolidated Statements and Other Financial Information — Legal and Administrative Proceedings.” Regardless of the outcome, these disputes may lead to legal or other proceedings and may result in substantial costs, delays in our schedule and the diversion of resources and management’s attention.
Consolidated Statements and Other Financial Information — Legal and Administrative Proceedings.” Regardless of the outcome, these disputes may lead to legal or other proceedings and may result in substantial costs, delays in our schedules and the diversion of resources and management’s attention.
As a result of the foregoing, we may experience significant increased operating and compliance costs, operating disruptions or limitations, reduced demand, and constraints on our growth, all of which could adversely affect our profits. Claims or regulatory actions against us under China’s competition laws may result in fines, constraints on our business and damage to our reputation.
As a result of the foregoing, we may experience significantly increased operating and compliance costs, operating disruptions or limitations, reduced demand, and constraints on our growth, all of which could adversely affect our profits. Claims or regulatory actions against us under mainland China’s competition laws may result in fines, constraints on our business and damage to our reputation.
Our operating results may be adversely affected by: • tightening of travel restrictions to Macau or from the PRC, including due to the outbreak of infectious diseases, such as COVID-19 outbreaks; • austerity measures which may be imposed by the PRC government; • changes in government policies, laws and regulations, or in the interpretation or enforcement of these policies, laws and regulations; • changes in cross-border fund transfer and/or foreign exchange regulations or policies effected by the PRC and/or Macau governments; • measures taken by the PRC government to deter marketing of gaming activities to mainland Chinese residents by offshore casinos; 46 Table of Contents • measures that may be introduced to control inflation, such as interest rate increases or bank account withdrawal controls; and • changes in the rate or method of taxation by the Macau government.
Our operating results may be adversely affected by: • tightening of travel restrictions to Macau or from mainland China, including due to the outbreak of infectious diseases, such as COVID-19 outbreaks; 45 Table of Contents • austerity measures which may be imposed by the mainland China government; • changes in government policies, laws and regulations, or in the interpretation or enforcement of these policies, laws and regulations; • changes in cross-border fund transfer and/or foreign exchange regulations or policies effected by the mainland China and/or Macau governments; • measures taken by the mainland China government to deter marketing of gaming activities to mainland China residents by offshore casinos; • measures that may be introduced to control inflation, such as interest rate increases or bank account withdrawal controls; and • changes in the rate or method of taxation by the Macau government.
We do not have any operations or maintain any office or personnel in mainland China. All of our current operations, and administrative and corporate functions are conducted in Macau, Hong Kong and Singapore. We conduct our operations in Macau and we do not have any assets or operations in the PRC.
We do not have any operations or maintain any office or personnel in mainland China. All of our current operations, and administrative and corporate functions are conducted in Macau, Hong Kong and Singapore. We conduct our operations in Macau and we do not have any assets or operations in mainland China.
We do not believe that our previous or any future offshore offerings are or will be subject to the filing procedures under the Trial Administrative New Measures and related guidelines as (i) we do not and do not expect to have any subsidiaries in the PRC, and none of our operating revenue, total profit, total assets or net assets as recorded in our audited consolidated financial statements for the most recent financial year is being accounted for by any PRC domestic subsidiaries; (ii) the main parts of the Company’s business activities are not and are not expected to be conducted in the PRC; (iii) the Company’s principal places of business are not and are not expected to be located in the PRC; (iv) the senior management in charge of the Company’s business operation are not PRC citizens and the management does not and is not expected to be domiciled in the PRC; and (v) the risk factors disclosed in the offering document of any future offshore offerings are not expected to be predominately related to the PRC as compared to other countries and regions.
We do not believe that our previous or any future offshore offerings are or will be subject to the filing procedures under the Trial Administrative New Measures and related guidelines as (i) we do not and do not expect to have any subsidiaries in mainland China, and none of our operating revenue, total profit, total assets or net assets as recorded in our audited consolidated financial statements for the most recent financial year is being accounted for by any mainland China domestic subsidiaries; (ii) the main parts of the Company’s business activities are not and are not expected to be conducted in mainland China; (iii) the Company’s principal places of business are not and are not expected to be located in mainland China; (iv) the senior management in charge of the Company’s business operation are not mainland China citizens and the management does not and is not expected to be domiciled in mainland China; and (v) the risk factors disclosed in the offering document of any future offshore offerings are not expected to be predominately related to mainland China as compared to other 48 Table of Contents countries and regions.
In addition, if any of our suppliers, service providers, technology partners or other business partners that have collaborative 34 Table of Contents relationships with us or our affiliates were to become subject to sanctions or other restrictions, this might restrict or negatively impact our ongoing relationships or collaborations with them, which could materially and adversely affect our competitiveness and business operations.
In addition, if any of our suppliers, service providers, technology partners or other business partners that have collaborative relationships with us or our affiliates were to become subject to sanctions or other restrictions, this might restrict or negatively impact our ongoing relationships or collaborations with them, which could materially and adversely affect our competitiveness and business operations.
In addition to market and industry factors, the price and trading volume for our ADSs may be highly volatile for factors specific to our own operations, including the following: • limited public float of our ADSs; • international political tensions, including between China and the U.S., and policies and/or legislation which may be proposed and/or enacted in relation to such tensions; • developments in the Macau market or other Asian gaming markets, including disruptions caused by widespread health epidemics or pandemics, such as COVID-19 outbreaks; • general economic, political or other factors that may affect Macau, where Studio City is located and/or the macroeconomic environment, including COVID-19 outbreaks or any other global pandemic or crisis; • changes in the economic performance or market valuations of the gaming and leisure industry companies; • changes in the Gaming Operator’s market share of the Macau gaming market; • regulatory developments affecting us or our competitors; • actual or anticipated fluctuations in our quarterly or annual operating results; • announcements of new investments, acquisitions, strategic partnerships, joint ventures or divestments by us or our competitors; • changes in financial estimates by securities analysts; • detrimental adverse publicity about us, Studio City or our industries; 53 Table of Contents • additions or departures of key personnel; • fluctuations in the exchange rates between the U.S. dollar, H.K. dollar, Pataca and Renminbi; • release or expiration of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; • sales or perceived sales of additional shares or ADSs or securities convertible or exchangeable or exercisable for shares or ADSs; • potential litigation or regulatory investigations; and • rumors related to any of the above, irrespective of their veracity.
In addition to market and industry factors, the price and trading volume for our ADSs may be highly volatile for factors specific to our own operations, including the following: • limited public float of our ADSs; • international political tensions, including between mainland China and the U.S., and policies and/or legislation which may be proposed and/or enacted in relation to such tensions; • developments in the Macau market or other Asian gaming markets, including disruptions caused by widespread health epidemics or pandemics; • general economic, political or other factors that may affect Macau, where Studio City is located and/or the macroeconomic environment, including global pandemics or other crises; • changes in the economic performance or market valuations of the gaming and leisure industry companies; • changes in the Gaming Operator’s market share of the Macau gaming market; • regulatory developments affecting us or our competitors; • actual or anticipated fluctuations in our quarterly or annual operating results; • announcements of new investments, acquisitions, strategic partnerships, joint ventures or divestments by us or our competitors; • changes in financial estimates by securities analysts; 52 Table of Contents • detrimental adverse publicity about us, Studio City or our industries; • additions or departures of key personnel; • fluctuations in the exchange rates between the U.S. dollar, H.K. dollar, Pataca and Renminbi; • release or expiration of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; • sales or perceived sales of additional shares or ADSs or securities convertible or exchangeable or exercisable for shares or ADSs; • potential litigation or regulatory investigations; and • rumors related to any of the above, irrespective of their veracity.
Permissions, Approvals, Licenses, Certificates and Permits Required from the PRC, Hong Kong and Macau Authorities for Our Operations and for the Offering of Our Securities to Foreign Investors As of the date of this annual report, we have obtained the requisite permissions, approvals, licenses, certificates and permits from the PRC, Hong Kong and Macau government authorities that are material for our business operations in those jurisdictions, and none have been denied.
Permissions, Approvals, Licenses, Certificates and Permits Required from Mainland China, Hong Kong and Macau Authorities for Our Operations and for the Offering of Our Securities to Foreign Investors As of the date of this annual report, we have obtained the requisite permissions, approvals, licenses, certificates and permits from mainland China, Hong Kong and Macau government authorities that are material for our business operations in those jurisdictions, and none have been denied.
Permissions, Approvals, Licenses, Certificates and Permits Required from the PRC, Hong Kong and Macau Authorities for Our Operations and for the Offering of Our Securities to Foreign Investors As of the date of this annual report, we have obtained the requisite permissions, approvals, licenses, certificates and permits from the PRC, Hong Kong and Macau government authorities that are material for our business operations in those jurisdictions, and none have been denied.
Permissions, Approvals, Licenses, Certificates and Permits Required from mainland China, Hong Kong and Macau Authorities for Our Operations and for the Offering of Our Securities to Foreign Investors As of the date of this annual report, we have obtained the requisite permissions, approvals, licenses, certificates and permits from mainland China, Hong Kong and Macau government authorities that are material for our business operations in those jurisdictions, and none have been denied.
The United States has also in certain circumstances threatened to impose further sanctions, trade embargoes, and other heightened regulatory requirements on the PRC and PRC-based companies. The U.S. government has brought enforcement actions against ZTE Corporation and Huawei and related persons, as well as companies who engaged in unauthorized transactions with Huawei.
The United States has also in certain circumstances threatened to impose further sanctions, trade embargoes, and other heightened regulatory requirements on mainland China and mainland China-based companies. The U.S. government has brought enforcement actions against ZTE Corporation and Huawei and related persons, as well as companies who engaged in unauthorized transactions with Huawei.
Business Overview — Regulations — Smoking Regulations.” Under the amended gaming law, the Macau government has set a cap on gaming tables and gaming machines that may be operated in Macau at 6,000 gaming tables and 12,000 gaming machines.
Business Overview — Regulations — Smoking Regulations.” Under the Macau Gaming Operations Law, the Macau government has set a cap on gaming tables and gaming machines that may be operated in Macau at 6,000 gaming tables and 12,000 gaming machines.
In addition, continued turbulence in the international markets may adversely affect our ability to access capital markets to meet liquidity needs. Studio City Casino’s operations could be adversely affected by foreign exchange restrictions on the Renminbi. Gaming operators in Macau are currently prohibited from accepting wagers in Renminbi, the currency of the PRC.
In addition, continued turbulence in the international markets may adversely affect our ability to access capital markets to meet liquidity needs. Studio City Casino’s operations could be adversely affected by foreign exchange restrictions on the Renminbi. Gaming operators in Macau are currently prohibited from accepting wagers in Renminbi, the currency of mainland China.
Any changes in the laws and regulations, or in the interpretation or enforcement of these laws and regulations, which affect gaming-related activities in the PRC could require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations and have a material and adverse effect on our business and prospects, financial condition and results of operations.
Any changes in the laws and regulations, or in the interpretation or enforcement of these laws and regulations, which affect gaming-related activities in mainland China could require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations and have a material and adverse effect on our business and prospects, financial condition and results of operations.
Based on the value of our assets and the composition of our income and assets, we do not believe we were a PFIC for United States federal income tax purposes for our taxable year ended December 31, 2023.
Based on the value of our assets and the composition of our income and assets, we do not believe we were a PFIC for United States federal income tax purposes for our taxable year ended December 31, 2024.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeAwards Studio City has received numerous awards, including: • Studio City’s Star Tower received the Forbes Travel Guide Five-Star recognition for the seventh consecutive year in 2024, • Zensa Spa was awarded the Forbes Travel Guide Five-Star recognition for the sixth time in 2024, • Its signature Cantonese restaurant Pearl Dragon received its sixth Forbes Travel Guide Five-Star recognition in 2024 and received one-MICHELIN-starred establishment rank for the eighth consecutive year in the MICHELIN Guide Hong Kong Macau 2024.
Biggest changeThis honor was awarded to W Macau – Studio City, which stands out among 16 recently opened or reopened hotels that have made an extraordinary impact, according to Prix Versailles; 67 Table of Contents • In 2025, Studio City’s Star Tower received the Forbes Travel Guide Five-Star recognition for the eighth consecutive year, while Epic Tower and The Spa at Epic Tower earned their inaugural Forbes Travel Guide Five-Star recognition; • Zensa Spa was awarded the Forbes Travel Guide Five-Star recognition for the seventh time in 2025 and was recognized as the Best Luxury Day Spa at the International Spa & Beauty Awards 2024; • Its signature Cantonese restaurant Pearl Dragon received its seventh Forbes Travel Guide Five-Star recognition in 2025 and received one-MICHELIN-starred establishment rank for the ninth consecutive year in the MICHELIN Guide Hong Kong Macau 2025.
The Gaming Operator owns the remaining gaming and gaming support equipment utilized at the Studio City Casino and the equipment utilized in the Studio City Hotel. Properties Apart from the property site for Studio City, we do not own or lease any other properties.
The Gaming Operator owns the remaining gaming and gaming support equipment utilized at the Studio City Casino and we own the equipment utilized in the Studio City Hotel. Properties Apart from the property site for Studio City, we do not own or lease any other properties.
The fee will increase to MOP2,500.00 (equivalent to approximately US$311) per square meter for years 4 to 10 of the concession, subject to consumer price index increase in years 5 to 10 of the concession. • The concessionaires shall assume certain corporate social responsibilities, including support for the development of local small and medium-sized enterprises; support the diversification of local industries, guaranteeing labor rights and interests, namely those concerning the guarantee of labor credits, on-the-job training and professional advancement of local employees, as well as a pension scheme designed to protect employees; hiring disabled or rehabilitated individuals; support for public interest activities; support for activities of an educational, scientific and technological, environmental protection, cultural and sporting nature, among others. • The concessionaires and the shareholders holding 5% or more of their registered share capital shall not hold directly any capital of another concessionaire for the operation of games of chance in casinos in Macau, and shall not hold indirectly 5% or more of its registered share capital. • Management companies are entities that have management powers over all or some casinos from one concessionaire and are subject to suitability reviews at DICJ’s discretion.
The fee will increase to MOP2,500.00 (equivalent to approximately US$313) per square meter for years 4 to 10 of the concession, subject to consumer price index increase in years 5 to 10 of the concession. • The concessionaires shall assume certain corporate social responsibilities, including support for the development of local small and medium-sized enterprises; support the diversification of local industries, guaranteeing labor rights and interests, namely those concerning the guarantee of labor credits, on-the-job training and professional advancement of local employees, as well as a pension scheme designed to protect employees; hiring disabled or rehabilitated individuals; support for public interest activities; support for activities of an educational, scientific and technological, environmental protection, cultural and sporting nature, among others. • The concessionaires and the shareholders holding 5% or more of their registered share capital shall not hold directly any capital of another concessionaire for the operation of games of chance in casinos in Macau, and shall not hold indirectly 5% or more of its registered share capital. • Management companies are entities that have management powers over all or some casinos from one concessionaire and are subject to suitability reviews at DICJ’s discretion.
These measures include providing players with information about responsible gaming behaviors, as well as about gaming dependency and addiction issues, including the information on responsible gaming; adequate measures to ensure the prohibition of entry into casinos of those to whom access is prohibited; information on the dissemination of the measure of interdiction of entry in casino upon request, as well as the means of submitting such request; creation of a specialized gaming group to provide adequate assistance and counseling services to those in need; and training and recycling actions on responsible gaming aimed at employees, as well as counseling services.
These measures include providing players with information about responsible gambling behaviors, as well as about gaming dependency and addiction issues, including the information on responsible gambling; adequate measures to ensure the prohibition of entry into casinos of those to whom access is prohibited; information on the dissemination of the measure of interdiction of entry in casino upon request, as well as the means of submitting such request; creation of a specialized gaming group to provide adequate assistance and counseling services to those in need; and training and recycling actions on responsible gambling aimed at employees, as well as counseling services.
The granting or renewal of a gaming promoter license may be requested by a commercial company that fulfills certain cumulative requirements, such as having its registered office in Macau, being a limited liability company by shares with the activity of gaming promotion as its exclusive business purpose, having a registered capital of not less than MOP10 million (equivalent to approximately US$1.2 million) fully paid up in cash, and net assets of not less than such amount during the license period, having as shareholders individuals only, having 50% or more of its registered capital being held by permanent residents of Macau who have completed 21 years of age, having agreed with one concessionaire the provision of gaming promotion services to the same, having provided a security deposit, not having any debts or fines imposed for breach of legal provisions relating to gaming under tax enforcement proceedings, having adequate financial capacity, not having the company and its shareholders, directors and key employees been declared insolvent or bankrupt, nor being responsible for debts arising from the insolvency or bankruptcy of third parties, and the company and its shareholders, directors and key employees being deemed suitable.
The granting or renewal of a gaming promoter license may be requested by a commercial company that fulfills certain cumulative requirements, such as having its registered office in Macau, being a limited liability company by shares with the activity of gaming promotion as its exclusive business purpose, having a registered capital of not less than MOP10 million (equivalent to approximately US$1.3 million) fully paid up in cash, and net assets of not less than such amount during the license period, having as shareholders individuals only, having 50% or more of its registered capital being held by permanent residents of Macau who have completed 21 years of age, having agreed with one concessionaire the provision of gaming promotion services to the same, having provided a security deposit, not having any debts or fines imposed for breach of legal provisions relating to gaming under tax enforcement proceedings, having adequate financial capacity, not having the company and its shareholders, directors and key employees been declared insolvent or bankrupt, nor being responsible for debts arising from the insolvency or bankruptcy of third parties, and the company and its shareholders, directors and key employees being deemed suitable.
The crime of unlawful deposit is applicable to concessionaires, gaming promoters or managing companies, their directors or representatives, or persons under their authority, in the exercise of their duties, or collaborators, in the exercise of their activity, who deposit funds from third parties not intended for gaming, and is punishable by imprisonment from 2 to 5 years in case of individuals, or fines up to MOP18 million (equivalent to approximately US$2.2 million) or judicial dissolution in case of legal persons.
The crime of unlawful deposit is applicable to concessionaires, gaming promoters or managing companies, their directors or representatives, or persons under their authority, in the exercise of their duties, or collaborators, in the exercise of their activity, who deposit funds from third parties not intended for gaming, and is punishable by imprisonment from 2 to 5 years in case of individuals, or fines up to MOP18 million (equivalent to approximately US$2.3 million) or judicial dissolution in case of legal persons.
Law no. 16/2001, as amended in June 2022 pursuant to Law no. 7/2022, or the Macau Gaming Operations Law, also sets out responsible gaming obligations, including the obligation of the concessionaires to prepare a plan for the promotion of responsible gaming, as well as to adopt measures that allow the public, including tourists, to have sufficient information to assume a responsible, moderate and controlled posture towards gaming.
Law no. 16/2001, as amended in June 2022 pursuant to Law no. 7/2022, or the Macau Gaming Operations Law, also sets out responsible gambling obligations, including the obligation of the concessionaires to prepare a plan for the promotion of responsible gambling, as well as to adopt measures that allow the public, including tourists, to have sufficient information to assume a responsible, moderate and controlled posture towards gaming.
Our cinematically-themed integrated resort is designed to attract a wide range of customers by providing highly differentiated non-gaming attractions, including the world’s first figure-8 Ferris wheel, a deluxe night club and karaoke venue, a 5,000-seat live performance arena, an outdoor and an indoor water park.
Our cinematically-themed integrated resort is designed to attract a wide range of customers by providing highly differentiated non-gaming attractions, including the world’s first figure-8 Ferris wheel, a deluxe night club and karaoke, a 5,000-seat live performance arena and an outdoor and an indoor water park.
MGM Grand was originally formed as a joint venture by MGM-Mirage and Ms. Pansy Ho, sister of Mr. Lawrence Ho. MGM Grand opened MGM Macau on the Macau Peninsula in December 2007 and MGM Cotai in February 2018. Galaxy currently operates multiple casinos in Macau, including StarWorld, a hotel and casino resort in Macau’s central business and tourism district.
MGM Grand Paradise was originally formed as a joint venture by MGM-Mirage and Ms. Pansy Ho, sister of Mr. Lawrence Ho. MGM Grand opened MGM Macau on the Macau Peninsula in December 2007 and MGM Cotai in February 2018. Galaxy currently operates multiple casinos in Macau, including StarWorld, a hotel and casino resort in Macau’s central business and tourism district.
A wide range of food and beverage outlets are located throughout Studio City, including traditional Cantonese, northern Chinese, South East Asian, Japanese, Italian and other western and international cuisines as well as local Macau cuisine. Studio City offers gourmet dining with a range of signature restaurants including one MICHELIN-starred Pearl Dragon .
A wide range of food and beverage outlets are located throughout Studio City, including traditional Cantonese, northern Chinese, South East Asian, Japanese, Italian and other western and international cuisines as well as local Macau cuisine. Studio City offers gourmet dining with a range of signature restaurants including the one MICHELIN-starred Pearl Dragon .
On the termination or expiry of the Concession Contract, the casino premises operated by the concessionaire and the gaming equipment would automatically revert or be transferred to the Macau SAR without compensation. Taxation We are domiciled in the Cayman Islands and our primary business operations are conducted through our subsidiaries.
On the termination or expiry of the Concession Contract, the casino premises operated by the concessionaire and the gaming equipment would revert or be transferred to the Macau SAR without compensation. Taxation We are domiciled in the Cayman Islands and our primary business operations are conducted through our subsidiaries.
The Macau government may be able to unilaterally rescind the Concession Contract upon the following termination events: • the operation of gaming without permission or operation of business which does not fall within the business scope of the concession; • abandonment of approved business or suspension of operations of our gaming business in Macau without reasonable grounds; • transfer of all or part of the Gaming Operator’s operation in Macau in violation of the relevant laws and administrative regulations governing the operation of games of chance in casino in Macau and without Macau government approval; • failure to pay taxes, premiums, levies or other amounts payable to the Macau government; • refusal or failure to resume operations following the temporary assumption of operations by the Macau government; • repeated opposition to the supervision and inspection by the Macau government and failure to comply with decisions and recommendations of the Macau government, especially those of the DICJ, applicable to the Gaming Operator; • failure to provide or supplement the guarantee deposit or the guarantees specified in the concession within the prescribed period; • bankruptcy or insolvency of the Gaming Operator; • fraudulent activity harming public interest; • serious and repeated violation of the applicable rules for carrying out games of chance in casino or damage to the fairness of games of chance in casino; • systematic non-compliance with the Macau Gaming Operations Law’s or Concession Contract’s obligations; or • non-compliance with the investment amount and the respective criteria provided for in the Concession Contract, within the deadline set out by the Secretary for Economy and Finance.
The Macau government may be able to unilaterally rescind the Concession Contract upon the following termination events: • the operation of gaming without permission or operation of business which does not fall within the business scope of the concession; • abandonment of approved business or suspension of operations of our gaming business in Macau without reasonable grounds; 86 Table of Contents • transfer of all or part of the Gaming Operator’s operation in Macau in violation of the relevant laws and administrative regulations governing the operation of games of chance in casino in Macau and without Macau government approval; • failure to pay taxes, premiums, levies or other amounts payable to the Macau government; • refusal or failure to resume operations following the temporary assumption of operations by the Macau government; • repeated opposition to the supervision and inspection by the Macau government and failure to comply with decisions and recommendations of the Macau government, especially those of the DICJ, applicable to the Gaming Operator; • failure to provide or supplement the guarantee deposit or the guarantees specified in the concession within the prescribed period; • bankruptcy or insolvency of the Gaming Operator; • fraudulent activity harming public interest; • serious and repeated violation of the applicable rules for carrying out games of chance in casino or damage to the fairness of games of chance in casino; • systematic non-compliance with the Macau Gaming Operations Law’s or Concession Contract’s obligations; or • non-compliance with the investment amount and the respective criteria provided for in the Concession Contract, within the deadline set out by the Secretary for Economy and Finance.
This includes commercial general liability (including product liability and accidental pollution liability), automobile liability, workers compensation, property damage and machinery breakdown and business interruption insurances. We also require certain contractors who may perform work on Studio City, as well as other vendors, to maintain certain insurances.
This includes commercial general liability (including product liability and accidental pollution liability), automobile liability, workers compensation, property damage and machinery breakdown, cybersecurity and business interruption insurances. We also require certain contractors who may perform work on Studio City, as well as other vendors, to maintain certain insurances.
Members of the corporate bodies of a management company may not be members of a corporate body of a concessionaire or gaming promoter. • The concessionaires must have a managing-director who is a Macau permanent resident and holds at least 15% of the registered share capital of the concessionaire. • The concessionaires are subject to the payment of an annual premium established in the concession contracts, which varies depending on the number of casinos that each concessionaire is authorized to operate, the number of authorized gaming tables and gaming machines, the type of games of chance operated, the location of the casinos, and other relevant criteria set by the Macau government. • If the average gross gaming revenue of the gaming tables or gaming machines does not reach a set minimum limit, the concessionaire must pay a special premium, in an amount equal to the difference between the amount of the special tax on gaming, calculated according to the average gross gaming revenue, and such minimum limit.
Members of the corporate bodies of a management company may not be members of a corporate body of a concessionaire or gaming promoter. • The concessionaires must have a managing-director who is a Macau permanent resident and holds at least 15% of the registered share capital of the concessionaire. 74 Table of Contents • The concessionaires are subject to the payment of an annual premium established in the concession contracts, which varies depending on the number of casinos that each concessionaire is authorized to operate, the number of authorized gaming tables and gaming machines, the type of games of chance operated, the location of the casinos, and other relevant criteria set by the Macau government. • If the average gross gaming revenue of the gaming tables or gaming machines does not reach a set minimum limit, the concessionaire must pay a special premium, in an amount equal to the difference between the amount of the special tax on gaming, calculated according to the average gross gaming revenue, and such minimum limit.
The Gaming Operator may be subject to administrative sanctions if, after it receives notice that a person is unsuitable to be a shareholder or to have any other relationship with it, the Gaming Operator: • pays that person any dividend or interest upon its shares; • allows that person to exercise, directly or indirectly, any voting right conferred through shares held by that person; 74 Table of Contents • pays remuneration in any form to that person for services rendered or otherwise; or • fails to pursue all lawful efforts to require that unsuitable person to relinquish his or her shares. • The Macau government also requires prior approval for the creation of a lien over shares or gaming equipment and utensils of a concession holder. • The Macau government must give its prior approval to changes in control through a merger, consolidation, shares acquisition, or any act or conduct by any person whereby such person obtains control.
The Gaming Operator may be subject to administrative sanctions if, after it receives notice that a person is unsuitable to be a shareholder or to have any other relationship with it, the Gaming Operator: • pays that person any dividend or interest upon its shares; • allows that person to exercise, directly or indirectly, any voting right conferred through shares held by that person; • pays remuneration in any form to that person for services rendered or otherwise; or • fails to pursue all lawful efforts to require that unsuitable person to relinquish his or her shares. • The Macau government also requires prior approval for the creation of a lien over shares or gaming equipment and utensils of a concession holder. • The Macau government must give its prior approval to changes in control through a merger, consolidation, shares acquisition, or any act or conduct by any person whereby such person obtains control.
The iconic landmark features 17 spacious Steampunk-themed cabins that can each accommodate up to ten passengers. • Studio City Event Center — a 5,000-seat multi-purpose arena representing the centerpiece of Studio City’s live entertainment offerings, including Macau’s first residency show experiences featuring headline acts such as Aaron Kwok ( 郭富城) and Leon Lai ( 黎明 ).
The iconic landmark features 17 spacious Steampunk-themed cabins that can each accommodate up to ten passengers. • Studio City Event Center — a 5,000-seat multi-purpose arena representing the centerpiece of Studio City’s live entertainment offerings, including Macau’s first residency show experiences featuring headline acts such as Aaron Kwok ( 郭富城) , Leon Lai ( 黎明 ) and Joey Yung ( 容祖兒 ).
Effective from January 1, 2023, the Macau government has transferred this area to the Gaming Operator for usage in its operations of the Studio City Casino during the duration of the concession for a fee of MOP750.00 (equivalent to approximately US$93) per square meter for years 1 to 3 of the Concession Contract, subject to consumer price index increase in years 2 and 3 of the concession.
Effective from January 1, 2023, the Macau government has transferred this area to the Gaming Operator for usage in its operations of the Studio City Casino during the duration of the concession for a fee of MOP750.00 (equivalent to approximately US$94) per square meter for years 1 to 3 of the Concession Contract, subject to consumer price index increase in years 2 and 3 of the concession.
Principal changes under the amended law include, among others, the following: • the number of gaming concessions that may be awarded by the Macau government is up to six; 70 Table of Contents • the term of the concessions may be up to ten years, subject to extension(s) of up to three years in total; • the registered share capital of each concessionaire shall be at least MOP5 billion (US$621.4 million); • the managing director of each concessionaire must be a Macau permanent resident and hold at least 15% of the concessionaire’s registered share capital; • significant transactions should be notified by concessionaires to the Macau government in advance; • an administrative sanctions regime is to be established; • national security is one of the main objectives of the Macau gaming legal framework and a concession may be terminated without compensation in case it is considered a threat to national security; • a per gaming table and per gaming machine special premium is due should gross gaming revenue fall below the gross gaming revenue threshold set by the Macau government; • the Macau government sets the maximum number of gaming tables and gaming machines allocated to each concessionaire and the allocation of such gaming tables and gaming machines to a specific casino is subject to the approval of the Macau government; • the Macau government may reduce the number of gaming tables or gaming machines in certain circumstances; • the amount of gaming chips of each concessionaire in circulation is subject to Macau government approval; and • the concessionaires are jointly and severally liable for administrative fines and civil liability arising from the exercise in their casinos of the authorized gaming promotion activity by gaming promoters, their directors and key employees, as well as their collaborators.
Principal changes under the amended law include, among others, the following: • the number of gaming concessions that may be awarded by the Macau government is up to six; • the term of the concessions may be up to ten years, subject to extension(s) of up to three years in total; • the registered share capital of each concessionaire shall be at least MOP5 billion (US$625.3 million); • the managing-director of each concessionaire must be a Macau permanent resident and hold at least 15% of the concessionaire’s registered share capital; • significant transactions should be notified by concessionaires to the Macau government in advance; • an administrative sanctions regime is to be established; • national security is one of the main objectives of the Macau gaming legal framework and a concession may be terminated without compensation in case it is considered a threat to national security; • a per gaming table and per gaming machine special premium is due should gross gaming revenue fall below the gross gaming revenue threshold set by the Macau government; • the Macau government sets the maximum number of gaming tables and gaming machines allocated to each concessionaire and the allocation of such gaming tables and gaming machines to a specific casino is subject to the approval of the Macau government; • the Macau government may reduce the number of gaming tables or gaming machines in certain circumstances; • the amount of gaming chips of each concessionaire in circulation is subject to Macau government approval; and • the concessionaires are jointly and severally liable for administrative fines and civil liability arising from the exercise in their casinos of the authorized gaming promotion activity by gaming promoters, their directors and key employees, as well as their collaborators.
Risk Factors — Risks relating to Conducting Business and Operating in Macau — Studio City Casino’s operations could be adversely affected by foreign exchange restrictions on the Renminbi.” Prevention and Suppression of Corruption in External Trade Regulations In addition to the general criminal laws regarding corrupt practices in the public and private sector that are in force in Macau, on January 1, 2015, Law no. 10/2014, criminalizing corruption acts in external trade and providing for a system for prevention and suppression of such criminal acts came into effect in Macau.
Risk Factors — Risks relating to Conducting Business and Operating in Macau — Studio City Casino’s operations could be adversely affected by foreign exchange restrictions on the Renminbi.” 81 Table of Contents Prevention and Suppression of Corruption in External Trade Regulations In addition to the general criminal laws regarding corrupt practices in the public and private sector that are in force in Macau, on January 1, 2015, Law no. 10/2014, criminalizing corruption acts in external trade and providing for a system for prevention and suppression of such criminal acts came into effect in Macau.
On August 16, 2022, we changed our auditor from Ernst & Young, located in Hong Kong, to Ernst & Young LLP, located in Singapore, which is not a PCAOB-Identified Firm. In December 2022, the PCAOB announced that it secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong.
On August 16, 2022, we changed our auditor from Ernst & Young, located in Hong Kong, to Ernst & Young LLP, located in Singapore, which was not a PCAOB-Identified Firm. In December 2022, the PCAOB announced that it secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong.
SJM (through its predecessor Tourism and Entertainment Company of Macau Limited) commenced its gaming operations in Macau in 1962 and opened Grand Lisboa Palace in Cotai in July 2021 and opened two additional hotels in 2023. MGM Grand Paradise S.A. or MGM Grand is a subsidiary of MGM China Holdings Limited, a company listed on the Hong Kong Stock Exchange.
SJM (through its predecessor Tourism and Entertainment Company of Macau Limited) commenced its gaming operations in Macau in 1962 and opened Grand Lisboa Palace in Cotai in July 2021 and opened two additional hotels in 2023. MGM Grand Paradise is a subsidiary of MGM China Holdings Limited, a company listed on the Hong Kong Stock Exchange.
Under Article 2 of Administrative Regulation no. 7/2006 (as amended pursuant to Administrative Regulation no. 17/2017) and the DICJ Instruction no. 1/2016 (as amended pursuant to DICJ Instruction no.1/2019), the Gaming Operator is required to track and report transactions and granting of credit that are of MOP500,000 (equivalent to approximately US$62,142) or above.
Under Article 2 of Administrative Regulation no. 7/2006 (as amended pursuant to Administrative Regulation no. 17/2017) and the DICJ Instruction no. 1/2016 (as amended pursuant to DICJ Instruction no. 1/2019), the Gaming Operator is required to track and report transactions and granting of credit that are of MOP500,000 (equivalent to approximately US$62,528) or above.
In January 2017, the Macau government granted an extension of the Macau complementary tax exemption for our subsidiary, Studio City Entertainment, until 2021, on profits generated from income received from the Gaming Operator, to the extent that such income results from gaming operations within Studio City Casino and has been subject to gaming tax.
In January 2017, the Macau government granted an extension of the Macau complementary tax exemption for our subsidiary, Studio City Entertainment, through 2021, on profits generated from income received from the Gaming Operator, to the extent that such income results from gaming operations within Studio City Casino and has been subject to gaming tax.
The information contained on our website is not part of this annual report on Form 20-F. The SEC maintains an internet site (http://www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. 63 Table of Contents B.
The information contained on our website is not part of this annual report on Form 20-F. The SEC maintains an internet site (http://www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. 62 Table of Contents B.
For further information on the Macau gaming market, see “— Market and Competition — Macau Gaming Market.” Gaming Studio City Casino currently consists of mass market table gaming, gaming machine and VIP gaming areas, with a total operating gross floor area of 28,784.3 square meters, located on the ground and first floors of Studio City.
For further information on the Macau gaming market, see “— Market and Competition — Macau Gaming Market.” Gaming Studio City Casino currently consists of mass market table gaming and gaming machine areas, with a total operating gross floor area of 28,784.3 square meters, located on the ground, first and second floors of Studio City.
In July 2023, the Macau government granted the declaration of touristic utility purpose to Studio City Developments pursuant to which Studio City Developments is entitled to the property tax holiday and is allowed to double the maximum rates applicable to depreciation and reintegration for the purposes of assessment of the Macau complementary tax. 90 Table of Contents C.
In July 2023, the Macau government granted the declaration of touristic utility purpose to Studio City Developments pursuant to which Studio City Developments is entitled to the property tax holiday and is allowed to double the maximum rates applicable to depreciation and reintegration for the purposes of assessment of the Macau complementary tax. 89 Table of Contents C.
Further, if the Gaming Operator terminates or suspends the operation of all or a part of its gaming operations without permission for reasons not due to force majeure , or in the event of serious disruptions or deficiencies in its organization and operation or in the general condition of its facilities and equipment which may affect the normal operation of our gaming business, the Macau government would be entitled to replace the Gaming Operator during such disruption and to ensure the continued operation of the gaming business.
Further, if the Gaming Operator terminates or suspends the operation of all or a part of its gaming operations without permission for reasons not due to force 72 Table of Contents majeure , or in the event of serious disruptions or deficiencies in its organization and operation or in the general condition of its facilities and equipment which may affect the normal operation of our gaming business, the Macau government would be entitled to replace the Gaming Operator during such disruption and to ensure the continued operation of the gaming business.
Gaming promoters are prohibited from resorting to the support of entities that are not their directors, employees or collaborators, in the exercise of the gaming promotion activity; from sharing, by any means, the revenues from the casinos with the concessionaire; from making, through the sharing of revenues from the casinos, the payment of commissions to any entity with which it cooperates; from cooperating with those who are prohibited from carrying out the activity of gaming promotion or of collaborator; and from depositing, by themselves or through third parties, chips or funds from third parties.
Gaming promoters are prohibited from resorting to the support of entities that are not 76 Table of Contents their directors, employees or collaborators, in the exercise of the gaming promotion activity; from sharing, by any means, the revenues from the casinos with the concessionaire; from making, through the sharing of revenues from the casinos, the payment of commissions to any entity with which it cooperates; from cooperating with those who are prohibited from carrying out the activity of gaming promotion or of collaborator; and from depositing, by themselves or through third parties, chips or funds from third parties.
The legal reserve is not available for distribution to the shareholders of the subsidiaries. The appropriation of the legal reserve is recorded in the subsidiaries’ financial statements in the year in which it is approved by the shareholders of the relevant subsidiaries. As of December 31, 2023, the balance of the legal reserve amounted to US$6,000.
The legal reserve is not available for distribution to the shareholders of the subsidiaries. The appropriation of the legal reserve is recorded in the subsidiaries’ financial statements in the year in which it is approved by the shareholders of the relevant subsidiaries. As of December 31, 2024, the balance of the legal reserve amounted to US$6,000.
The annual minimum limit of the gross gaming revenue must be set out in view of the past gross gaming revenue of Macau and the current situation of the economic development of Macau, and may be adjusted exceptionally in case of extraordinary, unpredictable or force majeure incidents, and is currently in the amount of MOP7 million (equivalent to approximately US$869,988) annual gross gaming revenue for gaming tables and MOP300,000 (equivalent to approximately US$37,285) annual gross gaming revenue for gaming machines. • With respect to the gaming promotion activities, the concessionaires must inform the DICJ of any facts that may affect the solvency of gaming promoters, including the fact that they have been named as defendants in civil proceedings or have entered into loan or financing agreements that exceed their 76 Table of Contents solvency, within a period of five days counted from the date of occurrence of the respective facts or the concessionaires’ knowledge thereof; inform the DICJ of facts that indicate the practice, by gaming promoters, of crimes and administrative offenses provided for in the law, within five days from the date of the concessionaires’ knowledge thereof, without prejudice to duties provided in other laws; supervise the activity of the gaming promoters, including their fulfillment of the duties provided in gaming laws and regulations; and adopt appropriate measures to prevent gaming promoters from conducting illegal activities in the casinos of the concessionaires. • Each gaming promoter can only conduct gaming promotion activities with one concessionaire and may only receive a commission, not being a gaming promoter permitted to share with the concessionaires, in any form whatsoever, the casino revenue. • The concessionaires are jointly and severally liable for administrative fines and civil liability arising from the exercise in their casinos of the authorized gaming promotion activity by gaming promoters, their directors and key employees, as well as their collaborators.
The annual minimum limit of the gross gaming revenue must be set out in view of the past gross gaming revenue of Macau and the current situation of the economic development of Macau, and may be adjusted exceptionally in case of extraordinary, unpredictable or force majeure incidents, and is currently in the amount of MOP7 million (equivalent to approximately US$875,392) annual gross gaming revenue for gaming tables and MOP300,000 (equivalent to approximately US$37,517) annual gross gaming revenue for gaming machines. • With respect to the gaming promotion activities, the concessionaires must inform the DICJ of any facts that may affect the solvency of gaming promoters, including the fact that they have been named as defendants in civil proceedings or have entered into loan or financing agreements that exceed their solvency, within a period of five days counted from the date of occurrence of the respective facts or the concessionaires’ knowledge thereof; inform the DICJ of facts that indicate the practice, by gaming promoters, of crimes and administrative offenses provided for in the law, within five days from the date of the concessionaires’ knowledge thereof, without prejudice to duties provided in other laws; supervise the activity of the gaming promoters, including their fulfillment of the duties provided in gaming laws and regulations; and adopt appropriate measures to prevent gaming promoters from conducting illegal activities in the casinos of the concessionaires. • Each gaming promoter can only conduct gaming promotion activities with one concessionaire and may only receive a commission, not being a gaming promoter permitted to share with the concessionaires, in any form whatsoever, the casino revenue. • The concessionaires are jointly and severally liable for administrative fines and civil liability arising from the exercise in their casinos of the authorized gaming promotion activity by gaming promoters, their directors and key employees, as well as their collaborators.
The newly-opened W Macau hotel tower offers 557 rooms with nine room types which range in size from 37 square meters to 257 square meters, while Epic Tower offers 338 suites with eight room types which range in size from 67 square meters to 550 square meters.
The W Macau hotel tower offers 557 rooms with nine room types which range in size from 37 square meters to 257 square meters, while Epic Tower offers 338 suites with eight room types which range in size from 67 square meters to 550 square meters.
Currently the maximum number of gaming tables that may be operated in Macau is 6,000 and the maximum number of gaming machines is 12,000 and the Gaming Operator has been authorized to operate 750 gaming tables and 2,100 gaming machines. • The circulation of chips is subject to authorization from the Secretary for Economy and Finance, which may establish the maximum limit of the total amount of chips in circulation. • The concessionaires can only disseminate information or activities related to gaming in the zones for games of changes of the casinos, under the applicable laws and regulations. • The concessionaires and the companies of which they are dominant shareholders cannot be admitted to listing on stock exchanges. • An administrative sanctions regime is established with fines ranging from MOP100,000 (equivalent to approximately US$12,428) and MOP5,000,000 (equivalent to approximately US$621,420) and, depending on the seriousness of the offense, damages, fault, benefits obtained, economic situation and previous conduct, a supplemental penalty of total or partial closure of gaming areas for periods ranging from one month to one year. • In the event of dissolution of a current concessionaire for failing to obtain a new concession in the next tender, the shareholders of the concessionaire holding 5% or more of the concessionaire’s share capital as of the date of termination of the concession contract or the date of termination of the concession are jointly and severally liable for the concessionaire’s outstanding chips.
Currently the maximum number of gaming tables that may be operated in Macau is 6,000 and the maximum number of gaming machines is 12,000 and the Gaming Operator has been authorized to operate 750 gaming tables and 2,100 gaming machines. 75 Table of Contents • The circulation of chips is subject to authorization from the Secretary for Economy and Finance, which may establish the maximum limit of the total amount of chips in circulation. • The concessionaires can only disseminate information or activities related to gaming in the zones for games of changes of the casinos, under the applicable laws and regulations. • The concessionaires and the companies of which they are dominant shareholders cannot be admitted to listing on stock exchanges. • An administrative sanctions regime is established with fines ranging from MOP100,000 (equivalent to approximately US$12,506) and MOP5,000,000 (equivalent to approximately US$625,280) and, depending on the seriousness of the offense, damages, fault, benefits obtained, economic situation and previous conduct, a supplemental penalty of total or partial closure of gaming areas for periods ranging from one month to one year. • In the event of dissolution of a current concessionaire for failing to obtain a new concession in the next tender, the shareholders of the concessionaire holding 5% or more of the concessionaire’s share capital as of the date of termination of the concession contract or the date of termination of the concession are jointly and severally liable for the concessionaire’s outstanding chips.
In many of these instances, the Concession Contract does not provide a specific cure period within which any such events may be cured and, instead, the Gaming Operator may be dependent on consultations and negotiations with the Macau 87 Table of Contents government to give it an opportunity to remedy any such default.
In many of these instances, the Concession Contract does not provide a specific cure period within which any such events may be cured and, instead, the Gaming Operator may be dependent on consultations and negotiations with the Macau government to give it an opportunity to remedy any such default.
We believe the Gaming Operator has implemented the necessary internal control systems to ensure compliance with the commission cap and reporting obligations in accordance with applicable rules and regulations. The exercise of the activity of collaborators and managing companies is also governed under Macau Law no. 16/2022.
We believe the Gaming Operator has implemented the necessary internal control 77 Table of Contents systems to ensure compliance with the commission cap and reporting obligations in accordance with applicable rules and regulations. The exercise of the activity of collaborators and managing companies is also governed under Macau Law no. 16/2022.
We generated all of our revenues for each of the years ended December 31, 2023, 2022 and 2021 from our operations in Macau, the sole market in which we compete to operate.
We generated all of our revenues for each of the years ended December 31, 2024, 2023 and 2022 from our operations in Macau, the sole market in which we compete to operate.
Advertising and Marketing The Gaming Operator holds various promotions and special events at Studio City and operates a loyalty program for patrons. In addition, Studio City participates in cross marketing and sales campaigns developed by the Gaming Operator. We believe this arrangement helps reduce marketing costs through scale synergies and enhances cross-revenue opportunities.
Advertising and Marketing The Gaming Operator holds various promotions and special events at Studio City and operates loyalty programs for patrons. In addition, Studio City participates in cross marketing and sales campaigns developed by the Gaming Operator. We believe this arrangement helps reduce marketing costs through scale synergies and enhances cross-revenue opportunities.
The fee will increase to MOP2,500.00 (equivalent to approximately US$311) per square meter for years 4 to 10 of the concession, subject to consumer price index increase in years 5 to 10 of the concession.
The fee will increase to MOP2,500.00 (equivalent to approximately US$313) per square meter for years 4 to 10 of the concession, subject to consumer price index increase in years 5 to 10 of the concession.
However, our current and any future trademarks are subject to expiration and we cannot guarantee that we will be able to renew all of them upon expiration. 72 Table of Contents Our trademarks and other intellectual property rights distinguish our services and products from those of our competitors and contribute to our ability to compete in our target markets.
However, our current and any future trademarks are subject to expiration and we cannot guarantee that we will be able to renew all of them upon expiration. Our trademarks and other intellectual property rights distinguish our services and products from those of our competitors and contribute to our ability to compete in our target markets.
Additional regulations have been enacted to further determine and detail how the above-mentioned obligations are to be fulfilled. Labor Quotas Regulations All businesses in Macau must apply to the Labor Affairs Bureau for labor quotas to import non-resident unskilled workers from the PRC and other regions or countries.
Additional regulations have been enacted to further determine and detail how the above-mentioned obligations are to be fulfilled. Labor Quotas Regulations All businesses in Macau must apply to the Labor Affairs Bureau for labor quotas to import non-resident unskilled workers from mainland China and other regions or countries.
The Gaming Operator executed the Subconcession Contract with Wynn Macau on September 8, 2006, which was extended until December 31, 2022 pursuant to the execution of an Amendment Agreement to the Subconcession Contract dated June 23, 2022, with Wynn Macau continuing to develop and run hotel operations and casino projects independent of the Gaming Operator.
The Gaming Operator executed the Subconcession Contract with Wynn Macau on September 8, 2006, which was extended until December 31, 2022 pursuant to the execution of an Amendment Agreement to the Subconcession Contract 84 Table of Contents dated June 23, 2022, with Wynn Macau continuing to develop and run hotel operations and casino projects independent of the Gaming Operator.
Under these laws and regulations, the Gaming Operator is required to: • implement internal procedures and rules governing the prevention of anti-money laundering and terrorism financing crimes which are subject to prior approval from DICJ; • identify and evaluate the money laundering and terrorism financing risk inherent to gaming activities; • identify any customer who is in a stable business relationship with the Gaming Operator, who is a politically exposed person or any customer or transaction where there is a sign of money laundering or financing of terrorism or which involves significant sums of money in the context of the transaction, even if any sign of money laundering is absent; • refuse to deal with any customers who fail to provide any information requested by the Gaming Operator; • keep records on the identification of a customer for a period of five years; • establish a regime for electronic transfers; • keep individual records of all transactions related to gaming which involve credit securities; • keep records of all electronic transactions for amounts equal to or exceeding MOP8,000 (equivalent to approximately US$994) in cases of occasional transactions and MOP120,000 (equivalent to approximately US$14,914) in cases of transactions that arose in the context of a continuous business relationship; • notify the Macau Finance Information Bureau if there is any sign of money laundering or financing of terrorism; 81 Table of Contents • adopt as compliance function and appoint compliance officers; and • cooperate with the Macau government by providing all required information and documentation requested in relation to anti-money laundering activities.
Under these laws and regulations, the Gaming Operator is required to: • implement internal procedures and rules governing the prevention of anti-money laundering and terrorism financing crimes which are subject to prior approval from DICJ; • identify and evaluate the money laundering and terrorism financing risk inherent to gaming activities; • identify any customer who is in a stable business relationship with the Gaming Operator, who is a politically exposed person or any customer or transaction where there is a sign of money laundering or financing of terrorism or which involves significant sums of money in the context of the transaction, even if any sign of money laundering is absent; • refuse to deal with any customers who fail to provide any information requested by the Gaming Operator; • keep records on the identification of a customer for a period of five years; • establish a regime for electronic transfers; • keep individual records of all transactions related to gaming which involve credit securities; • keep records of all electronic transactions for amounts equal to or exceeding MOP8,000 (equivalent to approximately US$1,000) in cases of occasional transactions and MOP120,000 (equivalent to approximately US$15,007) in cases of transactions that arose in the context of a continuous business relationship; • notify the Macau Finance Information Bureau if there is any sign of money laundering or financing of terrorism; • adopt as compliance function and appoint compliance officers; and • cooperate with the Macau government by providing all required information and documentation requested in relation to anti-money laundering activities.
In the event that the results of the review reveal non-compliance or lack of proactiveness in complying with the concession contracts, concessionaires should improve compliance within the deadline determined by the Secretary for Economy and Finance. • The concessionaires registered share capital shall not be less than MOP5 billion (equivalent to approximately US$621.4 million) and during the term of the concession their net assets shall not be less than such amount.
In the event that the results of the review reveal non-compliance or lack of proactiveness in complying with the concession contracts, concessionaires should improve compliance within the deadline determined by the Secretary for Economy and Finance. • The concessionaires registered share capital shall not be less than MOP5 billion (equivalent to approximately US$625.3 million) and during the term of the concession their net assets shall not be less than such amount.
Dining We believe that our selection of dining options that include restaurants, bars and lounges offering a diverse selection of local, regional and international cuisine attracts more visitors to Studio City. Studio City offers both high-end and casual dining restaurants, cafes, bars and lounges to cater to the tastes and preferences of our patrons.
Dining We believe that our selection of dining options that include restaurants, bars and lounges offering a diverse selection of local, regional and international cuisine attracts more visitors to Studio City. Studio City 64 Table of Contents offers both high-end and casual dining restaurants, cafes, bars and lounges to cater to the tastes and preferences of our patrons.
The Industrial Property Code (Decree-Law no. 97/99/M, as amended pursuant to Law no. 11/2001), covers 83 Table of Contents (i) inventions meeting the patentability requirements; (ii) semiconductor topography products; (iii) trademarks; (iv) designations of origin and geographical indications; and (v) awards.
The Industrial Property Code (Decree-Law no. 97/99/M, as amended pursuant to Law no. 11/2001), covers (i) inventions meeting the patentability requirements; (ii) semiconductor topography products; (iii) trademarks; (iv) designations of origin and geographical indications; and (v) awards.
Studio City features approximately 2,493 luxury hotel rooms, diverse food and beverage establishments and approximately 38,500 square meters of complementary retail space. Studio City is strategically located in Cotai, as one of the few dedicated Cotai hotel-casino resort stops on the Macau Light Rapid Transit Line, with an access bridge leading to Studio City.
Studio City features approximately 2,493 luxury hotel rooms, diverse food and beverage establishments, a nine-screen cineplex and approximately 38,500 square meters of complementary retail space. Studio City is strategically located in Cotai, as one of the few dedicated Cotai hotel-casino resort stops on the Macau Light Rapid Transit Line, with an access bridge leading to Studio City.
The loyalty program, which is operated by the Gaming Operator jointly with other Gaming Operator casinos, at Studio City ensures that each customer segment is specifically recognized and incentivized in accordance with their revenue contribution. The loyalty program is segmented into several tiers.
The loyalty programs, which are operated by the Gaming Operator jointly with other Gaming Operator casinos and properties, at Studio City ensures that each customer segment is specifically recognized and incentivized in accordance with their revenue contribution. The gaming loyalty program is segmented into several tiers.
The following diagram illustrates our organizational structure, including the place of formation, ownership interest and affiliation of our significant subsidiaries, as of March 15, 2024: 91 Table of Contents Notes: 1. Includes 747,288 Class A ordinary shares held by Melco International. See “Item 7. Major Shareholders and Related Party Transactions — A. Major Shareholders.” 2.
The following diagram illustrates our organizational structure, including the place of formation, ownership interest and affiliation of our significant subsidiaries, as of March 15, 2025: 90 Table of Contents Notes: 1. Includes 747,288 Class A ordinary shares held by Melco International. See “Item 7. Major Shareholders and Related Party Transactions — A. Major Shareholders.” 2.
Mass Market Segment The mass market gaming area caters to mass market gaming patrons and offers a full range of games, 24 hours daily. The layout of the gaming floor is organized using the different market segments that Studio City Casino targets, namely the mainstream mass market and the premium mass market.
Mass Market Segment The mass market gaming area caters to mass market patrons and offers a full range of games, 24 hours daily. The layout of the gaming floor is organized based on the different market segments that Studio City Casino targets, namely the mainstream mass market and the premium mass market.
Such joint and several liability may be excluded when it is proved that the concessionaire has responsibly fulfilled its supervision duty. Other Regional Markets Studio City may also face competition from casinos and gaming resorts located in other Asian or European destinations together with cruise ships.
Such joint and several liability may be excluded when it is proved that the concessionaire has responsibly fulfilled its supervision duty. 69 Table of Contents Other Regional Markets Studio City may also face competition from casinos and gaming resorts located in other Asian or European destinations together with cruise ships.
The concessionaires must mandatorily notify the Chief Executive of Macau prior to executing large financial initiatives, which are defined as those with a value greater than MOP2.5 billion (equivalent to approximately US$310.7 million) regarding the internal movement of funds and MOP500 million (equivalent to approximately US$62.1 million) regarding salaries, remunerations, benefits of employees, and any other financial decisions. • The main objectives of the gaming law are, amongst others, safeguarding of national and Macau security, adequate diversification and sustainable development of the Macau economy, assurance that the development and operation of games of chance in casinos are in line with Macau’s policies and mechanisms in respect of combating the illegal flow of cross-border capital and preventing money laundering, and the scale, operation and practice of games of chance in casinos are subject to legal restrictions.
The concessionaires must mandatorily notify the Chief Executive of Macau prior to executing large financial initiatives, which are defined as those with a value greater than MOP2.5 billion (equivalent to approximately US$312.6 million) regarding internal movement of funds and MOP500 million (equivalent to approximately US$62.5 million) regarding salaries, remunerations, benefits of employees, and any other financial decisions. 73 Table of Contents • The main objectives of the gaming law are, amongst others, safeguarding of national and Macau security, adequate diversification and sustainable development of the Macau economy, assurance that the development and operation of games of chance in casinos are in line with Macau’s policies and mechanisms in respect of combating the illegal flow of cross-border capital and preventing money laundering, and the scale, operation and practice of games of chance in casinos are subject to legal restrictions.
Individuals that fail to duly complete the required declaration may be subject to a fine (ranging from 1% to 5% of the amount that exceeds the amount determined by the order of the Chief Executive of Macau for declaration purposes, such fine being at least MOP1,000 (equivalent to approximately US$124) and not exceeding MOP500,000 (equivalent to approximately US$62,142)).
Individuals that fail to duly complete the required declaration may be subject to a fine (ranging from 1% to 5% of the amount that exceeds the amount determined by the order of the Chief Executive of Macau for declaration purposes, such fine being at least MOP1,000 (equivalent to approximately US$125) and not exceeding MOP500,000 (equivalent to approximately US$62,528)).
Transfers of property and credit rights of the Gaming Operator exceeding MOP100,000,000 (equivalent to approximately US$12,428,400) and loan agreements or similar arrangements executed by the Gaming Operator as borrower or creditor equal to or exceeding that amount are each subject to approval by the Macau SAR government, except for those loan agreements related to credit granted for gaming purposes.
Transfers of property and credit rights of the Gaming Operator exceeding MOP100,000,000 (equivalent to approximately US$12,505,599) and loan agreements or similar arrangements executed by the Gaming Operator as borrower or creditor equal to or exceeding that amount are each subject to approval by the Macau SAR government, except for those loan agreements related to credit granted for gaming purposes.
Risk Factors — Risks Relating to Our Business — The possible infringement of key intellectual property used in our business, the dissemination of proprietary information used in our business or the infringement or alleged infringement of intellectual property rights belonging to third parties could adversely affect our business.” Personal Information Regulations Processing of personal information by our subsidiaries in Macau is subject to compliance with the Personal Data Protection Act (Law no. 8/2005), in the case of Melco Resorts Macau, any instructions issued by DICJ from time to time.
Risk Factors — Risks Relating to Our Business — The possible infringement of key intellectual property used in our business, the dissemination of proprietary information used in our business or the infringement or alleged infringement of intellectual property rights belonging to third parties could adversely affect our business.” Personal Information Regulations Processing of personal information by our subsidiaries in Macau is subject to compliance with the Personal Data Protection Act (Law no. 8/2005), and, in the case of the Gaming Operator, any instructions issued by DICJ from time to time.
Sands China Ltd. opened the Parisian Macao in Cotai in September 2016. Wynn Resorts Macau, is a subsidiary of Wynn Macau, Limited, which is listed on the Hong Kong Stock Exchange, and of Wynn Resorts Limited, which is listed on the Nasdaq Global Select Market.
Sands China Ltd. opened the Parisian Macao in Cotai in September 2016. 68 Table of Contents Wynn Resorts Macau, is a subsidiary of Wynn Macau, Limited, which is listed on the Hong Kong Stock Exchange, and of Wynn Resorts Limited, which is listed on the Nasdaq Global Select Market.
The Code of Business Conduct and Ethics, or the Code, includes provisions relating to compliance of all applicable anti-corruption laws including FCPA and the relevant Macau laws. The Ethical Business Practices Program covers corruption in both public and private sectors.
Our Code of Business Conduct and Ethics, or the Code, includes provisions relating to compliance of all applicable anti-corruption laws including FCPA and the relevant Macau laws. Our Ethical Business Practices Program covers our approach to avoid corruption in both public and private sectors.
Further, it imposed policies, regulations and restrictions that affect the minimum age required for entrance into casinos in Macau, location requirements for sites with gaming machine lounges, supply and requirements of gaming 77 Table of Contents machines, equipment and systems, instructions on promoting responsible gaming, restrictions on the reallocation of gaming tables between properties and other matters.
Further, it imposed policies, regulations and restrictions that affect the minimum age required for entrance into casinos in Macau, location requirements for sites with gaming machine lounges, supply and requirements of gaming machines, equipment and systems, instructions on promoting responsible gambling, restrictions on the reallocation of gaming tables between properties and other matters.
The complex has a first-class premium seating level offering 16 private VIP suites, in addition to approximately 242 luxury club 66 Table of Contents seats and a deluxe club lounge. Each VIP suite is spacious and elegantly designed, coming fully equipped with stylish furnishings and a flat-screen TV.
The complex has a first-class premium seating level offering 16 private VIP suites, in addition to approximately 242 luxury club seats and a deluxe club lounge. Each VIP suite is spacious and elegantly designed, coming fully equipped with stylish furnishings and a flat-screen TV.
Set out below are the key terms in relation to ownership and capitalization under the Concession Contract: • the registered share capital and net asset value of the Gaming Operator cannot be less than MOP5,000,000,000 (equivalent to approximately US$621,419,999) and, to guarantee its performance of certain of its legal and contractual obligations, including labor obligations, the Gaming Operator must maintain a guarantee issued by a Macau SAR bank in favor of the Macau SAR in the amount of MOP1,000,000,000 (equivalent to approximately US$124,284,000) until 180 days after the earlier of the expiration or termination of the Concession; • the managing director of the Gaming Operator must be a permanent resident of the Macau SAR and must hold at least 15% of the registered share capital of the Gaming Operator; • any person who directly acquires voting rights in the Gaming Operator will be subject to authorization from the Macau government; 88 Table of Contents • the Gaming Operator will be required to take the necessary measures to ensure that any person who directly or indirectly acquires more than 5% of the shares in the Gaming Operator would be subject to authorization from the Macau government, except when such acquisition is wholly made through the shares of publicly-listed companies tradable at a stock exchange; • any person who directly or indirectly acquires more than 5% of the shares in the Gaming Operator will be required to report the acquisition to the Macau government (except when such acquisition is wholly made through shares tradable on a stock exchange as a publicly-listed company); • the Macau government’s prior approval would be required for any recapitalization plan of the Gaming Operator; and • the Chief Executive of Macau could require the increase of the Gaming Operator’s share capital, if deemed necessary.
Set out below are the key terms in relation to ownership and capitalization under the Concession Contract: • the registered share capital and net asset value of the Gaming Operator cannot be less than MOP5,000,000,000 (equivalent to approximately US$625,279,969) and, to guarantee its performance of certain of its legal and contractual obligations, including labor obligations, the Gaming Operator must maintain a guarantee issued by a Macau SAR bank in favor of the Macau SAR in the amount of MOP1,000,000,000 (equivalent to approximately US$125,055,994) until 180 days after the earlier of the expiration or termination of the concession; • the managing director of the Gaming Operator must be a permanent resident of the Macau SAR and must hold at least 15% of the registered share capital of the Gaming Operator; • any person who directly acquires voting rights in the Gaming Operator will be subject to authorization from the Macau government; • the Gaming Operator will be required to take the necessary measures to ensure that any person who directly or indirectly acquires more than 5% of the shares in the Gaming Operator would be subject to authorization from the Macau government, except when such acquisition is wholly made through the shares of publicly-listed companies tradable at a stock exchange; • any person who directly or indirectly acquires more than 5% of the shares in the Gaming Operator will be required to report the acquisition to the Macau government (except when such acquisition is wholly made through shares tradable on a stock exchange as a publicly-listed company); 87 Table of Contents • the Macau government’s prior approval would be required for any recapitalization plan of the Gaming Operator; and • the Chief Executive of Macau could require the increase of the Gaming Operator’s share capital, if deemed necessary.
In accordance with such law, all individuals entering Macau with an amount in cash or negotiable instrument to the bearer equal to or higher than the amount determined by the order of the Chief Executive of Macau at MOP120,000 (equivalent to approximately US$14,914) will be required to declare such amount to the customs authorities.
In accordance with such law, all individuals entering Macau with an amount in cash or negotiable instrument to the bearer equal to or higher than the amount determined by the order of the Chief Executive of Macau at MOP120,000 (equivalent to approximately US$15,007) will be required to declare such amount to the customs authorities.
The Macau government owns the Studio City Casino gaming and gaming support areas, and the Macau government has transferred these areas to the Gaming Operator for usage in its operations during the duration of the concession for a fee of MOP750.00 (equivalent to approximately US$93) per 75 Table of Contents square meter for years 1 to 3 of the Concession Contract, subject to consumer price index increase in years 2 and 3 of the concession.
The Macau government owns the Studio City Casino gaming and gaming support areas, and the Macau government has transferred these areas to the Gaming Operator for usage in its operations during the duration of the concession for a fee of MOP750.00 (equivalent to approximately US$94) per square meter for years 1 to 3 of the Concession Contract, subject to consumer price index increase in years 2 and 3 of the concession.
A managing company can only enter into a managing agreement with one concessionaire, and can only receive management fees from the concessionaire, with casino revenue sharing or payment of commissions not 79 Table of Contents being permitted.
A managing company can only enter into a managing agreement with one concessionaire, and can only receive management fees from the concessionaire, with casino revenue sharing or payment of commissions not being permitted.
The Gaming Operator has developed a comprehensive anti-money laundering policy and related procedures covering its anti-money laundering responsibilities, which have been approved by the DICJ, and has training programs in place to ensure that all relevant employees understand such anti-money laundering policy and procedures.
The Gaming Operator has developed a comprehensive anti-money laundering policy and related procedures covering its anti-money laundering responsibilities, which have been approved by the DICJ, and has training programs in place to ensure that all relevant employees understand such anti-money laundering policy 80 Table of Contents and procedures.
Under the land concession contract, the Macau government may exercise its termination rights under certain conditions. Prior to our completion of the Phase 2 development, land use fees of approximately MOP3.9 million (equivalent to approximately US$484,708) per annum were payable to the Macau government.
Under the land concession contract, the Macau government may exercise its termination rights under certain conditions. Prior to our completion of the Phase 2 development, land use fees of approximately MOP3.9 million (equivalent to approximately US$487,718) per annum were payable to the Macau government.
The Celebrity Tower with approximately 1,000 rooms 65 Table of Contents brings a deluxe hotel experience to a board range of travelers, which includes access to all of the entertainment facilities offered by Studio City. It offers eleven different room types ranging from the Celebrity King at 42 square meters to the Celebrity Deluxe Suite at 95 square meters.
The Celebrity Tower with approximately 1,000 rooms brings a deluxe hotel experience to a broad range of travelers, which includes access to all of the entertainment facilities offered by Studio City. It offers eleven different room types ranging from the Celebrity King at 42 square meters to the Celebrity Deluxe Suite at 95 square meters.
A proposed project in Osaka was awarded to MGM Resorts International and its joint venture partner Orix Corporation which is currently slated to open in 2030. In addition, several other Asian countries are considering or are in the process of legalizing gambling and establishing casino-based entertainment complexes.
In Japan, a proposed project in Osaka was awarded to MGM Resorts International and its joint venture partner Orix Corporation which is currently slated to open in 2030. In addition, several other Asian countries are considering or are in the process of legalizing gambling and establishing casino-based entertainment complexes, including Thailand and Sri Lanka.
In addition, gaming tables and gaming machines previously allocated to a concessionaire may also be revoked if the minimum average annual gross gaming revenue of MOP7 million (equivalent to approximately US$869,988) for gaming tables and MOP300,000 (equivalent to approximately US$37,285) for gaming machines are not met for two consecutive years or the tables or gaming machines are not fully utilized without reason within a certain period.
In addition, gaming tables and gaming machines previously allocated to a concessionaire may also be revoked if the minimum average annual gross gaming revenue of MOP7 million (equivalent to approximately US$875,392) for gaming tables and MOP300,000 (equivalent to approximately US$37,517) for gaming machines are not met for two consecutive years or the tables or gaming machines are not fully utilized without reason within a certain period.
All concessionaires must pay a special gaming tax of 35% of gross gaming revenues, defined as all gaming revenues derived from casino or gaming areas, plus an annual gaming premium of: • MOP30 million (equivalent to approximately US$3.7 million) per annum fixed premium; • MOP300,000 (equivalent to approximately US$37,285) per annum per VIP gaming table; • MOP150,000 (equivalent to approximately US$18,643) per annum per mass market gaming table; and • MOP1,000 (equivalent to approximately US$124) per annum per electric or mechanical gaming subject to a minimum annual payment of an amount required for the operation of 500 gaming tables and 1,000 electronic gaming machines.
All concessionaires must pay a special gaming tax of 35% of gross gaming revenues, defined as all gaming revenues derived from casino or gaming areas, plus an annual gaming premium of: • MOP30 million (equivalent to approximately US$3.8 million) per annum fixed premium; • MOP300,000 (equivalent to approximately US$37,517) per annum per VIP gaming table; • MOP150,000 (equivalent to approximately US$18,758) per annum per mass market gaming table; and • MOP1,000 (equivalent to approximately US$125) per annum per electric or mechanical gaming subject to a minimum annual payment of an amount required for the operation of 500 gaming tables and 1,000 electronic gaming machines.
Hong Kong Our subsidiaries incorporated in Hong Kong and one of our subsidiaries incorporated in the BVI are subject to Hong Kong profits tax on their taxable income earned in or derived from Hong Kong at a uniform tax rate of 16.5%. Payments of dividends by our subsidiaries to us are not subject to withholding tax in Hong Kong.
Hong Kong Our subsidiaries incorporated in Hong Kong and one of our subsidiaries incorporated in the British Virgin Islands are subject to Hong Kong profits tax on their taxable income earned in or derived from Hong Kong at a tax rate of 16.5%. Payments of dividends by our subsidiaries to us are not subject to withholding tax in Hong Kong.
Prior to the tendering process in 2022, the subconcessionaires that entered into subconcession contracts with Wynn Macau, SJM and Galaxy were Melco Resorts Macau, MGM Grand Paradise and VML, respectively.
Prior to the tendering process in 2022, the subconcessionaires that entered into subconcession contracts with Wynn Macau, SJM and Galaxy were Melco Resorts Macau, MGM Grand Paradise and Venetian Macau, S.A., respectively.
A special premium may be due by the Gaming Operator in the event the average gross gaming revenue of the Gaming Operator’s gaming tables does not reach the annual minimum of MOP7,000,000 (equivalent to approximately US$869,988) and the average gross gaming revenue of the gaming machines does not reach the annual minimum of MOP300,000 (equivalent to approximately US$37,285).
A special premium may be due by the Gaming Operator in the event the average gross gaming revenue of the Gaming Operator’s gaming tables does not reach the annual minimum of MOP7,000,000 (equivalent to approximately US$875,392) and the average gross gaming revenue of the gaming machines does not reach the annual minimum of MOP300,000 (equivalent to approximately US$37,517).
The Concession Contract requires the Gaming Operator to make a minimum investment in Macau of MOP11,823,700,000 (equivalent to approximately US$1.47 billion) The investment plan includes gaming and non-gaming related projects in the expansion of foreign market patrons, conventions and exhibitions, entertainment shows, sports events, art and culture, health 86 Table of Contents and well-being, thematic entertainment, gastronomy, community and maritime tourism and others.
The Concession Contract requires the Gaming Operator to make a minimum investment in Macau of MOP11,823.7 million (equivalent to approximately US$1.48 billion) The investment plan includes gaming and non-gaming related projects in the expansion of foreign market patrons, conventions and exhibitions, entertainment shows, sports events, art and culture, health and well-being, thematic entertainment, gastronomy, community and maritime tourism and others.
Organizational Structure.” On May 4, 2022, we were identified as a Commission-Identified Issuer under the Holding Foreign Companies Accountable Act (“HFCAA”) and the rules promulgated thereunder because our auditor at that time was Ernst & Young, located in Hong Kong, which was a PCAOB-Identified Firm as of May 4, 2022.
Organizational Structure.” On May 4, 2022, we were identified as a Commission-Identified Issuer under the HFCAA and the rules promulgated thereunder because our auditor at that time was Ernst & Young, located in Hong Kong, which was a PCAOB-Identified Firm as of May 4, 2022.
Of the total investment amount referred to above, MOP10,008,000,000 (equivalent to approximately US$1.24 billion) will be applied to non-gaming related projects, with the balance applied to gaming related projects.
Of the total investment amount referred to above, MOP10,008.0 million (equivalent to approximately US$1.25 billion) will be applied to non-gaming related projects, with the balance applied to gaming related projects.
Studio City Casino’s VIP rolling chip volume, VIP rolling chip win rate and VIP rolling chip gross gaming revenue were US$2.79 billion, 1.65% and US$46.0 million, respectively, in 2023, US$0.84 billion, 2.56% and US$21.4 million, respectively, in 2022 and US$1.84 billion, 2.00% and US$36.8 million, respectively, in 2021.
Studio City Casino’s VIP rolling chip volume, VIP rolling chip win rate and VIP rolling chip gross gaming revenue were US$2.00 billion, 3.85% and US$77.1 million, respectively, in 2024, US$2.79 billion, 1.65% and US$46.0 million, respectively, in 2023 and US$0.84 billion, 2.56% and US$21.4 million, respectively, in 2022.
After the end of such three-year transition period the concessionaires may only continue to operate games of chance in casino in properties that are not owned by them by engaging a managing company.
After the end of such three-year transition period the concessionaires may only continue to operate games of chance in casino in properties that are not owned by them by engaging a managing company, such engagement to be subject to the Chief Executive of Macau’s approval.
See “— Our Internal Control Policies.” The Gaming Operator’s Concession The Concession Regime The Macau government conducted an international tender process for gaming concessions in Macau in 2022, and granted six gaming concessions to SJM, MGM Grand, Galaxy, Venetian Macau Limited (“VML”), 85 Table of Contents Wynn Macau and Melco Resorts Macau, respectively. Subconcessions are prohibited.
See “— Our Internal Control Policies.” The Gaming Operator’s Concession The Concession Regime The Macau government conducted an international tender process for gaming concessions in Macau in 2022, and granted six gaming concessions to SJM, MGM Grand Paradise, Galaxy, Venetian Macau, S.A., Wynn Macau and Melco Resorts Macau, respectively. Subconcessions are prohibited.
The Gaming Operator operated an average of approximately 246 gaming tables and 661 gaming machines in 2023 at the Studio City Casino, compared to an average of approximately 277 gaming tables and 700 gaming machines in 2022 and an average of approximately 290 gaming tables and 645 gaming machines in operation in 2021.
The Gaming Operator operated an average of approximately 251 gaming tables and 709 gaming machines in 2024 at the Studio City Casino, compared to an average of approximately 246 gaming tables and 661 gaming machines in 2023 and an average of approximately 277 gaming tables and 700 gaming machines in operation in 2022.
VIP rolling chip players can earn a variety of gaming related cash commissions and complimentary products and services, such as rooms, food and beverage and retail products provided by the Gaming Operator.
VIP rolling chip patrons were eligible to earn a variety of gaming related cash commissions and complimentary products and services, such as rooms, food and beverage and retail products provided by the Gaming Operator.
Studio City Casino will continue to re-examine the mass market gaming areas to maximize table utilization, to innovate gaming products and to invest in technologies and analytical capability to enhance table productivity and customer retention. VIP Rolling Chip Segment In November 2016, Studio City Casino introduced VIP rolling chip operations.
Studio City Casino will continue to re-examine the mass market gaming areas to maximize table utilization, to innovate gaming products and to invest in technologies and analytical capability to enhance table productivity and customer retention. VIP Rolling Chip Segment VIP rolling chip operations at the Studio City Casino ceased in late October 2024.
In most cases, private interests in real property located in Macau are obtained through long-term leases from the Macau government. Our subsidiary has entered into a land concession contract for the land on which the Studio City property is located.
Land Regulations Land in Macau is legally divided into plots. In most cases, private interests in real property located in Macau are obtained through long-term leases from the Macau government. 83 Table of Contents Our subsidiary has entered into a land concession contract for the land on which the Studio City property is located.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe pace of recovery of our business from COVID-19 could vary materially from our current expectations and could materially affect our business, prospects, financial condition and results of operations; 104 Table of Contents • The implementation of the amended Macau Gaming Operations Law, as well as any other policies and legislation implemented by the Macau government, including interpretations thereof, such as those relating to travel and visa policies; • Policies and campaigns implemented by the PRC government, including restrictions on travel, anti-corruption campaigns, heightened monitoring of cross-border currency movement and adoption of new measures to eliminate perceived channels of illicit cross-border currency movements, restrictions on currency withdrawal, increased scrutiny of marketing activities in the PRC or new measures taken by the PRC government, including criminalizing certain conduct, to deter marketing of gaming activities to mainland Chinese residents by foreign casinos, as well as any slowdown of economic growth in the PRC, may lead to a decline and limit the recovery and growth in the number of patrons visiting our property and the spending amount of such patrons; • The gaming and leisure market in Macau is developing and the competitive landscape is expected to evolve as more gaming and non-gaming facilities are developed in Macau.
Biggest changeTREND INFORMATION The following trends and uncertainties may affect our operations and financial conditions: • Policies and campaigns implemented by the mainland China government, including restrictions on travel, anti-corruption campaigns, monitoring of cross-border currency movement and adoption of measures to eliminate perceived channels of illicit cross-border currency movements, restrictions on currency withdrawal, scrutiny of marketing activities in mainland China or measures taken by the mainland China government, including criminalizing certain conduct, to deter marketing of gaming 103 Table of Contents activities to mainland China residents by foreign casinos, as well as any slowdown of economic growth in mainland China, may lead to a decline and limit the recovery and growth in the number of patrons visiting our property and the spending amount of such patrons; • Policies and legislation implemented by the Macau government, including interpretations thereof, such as those relating to travel and visa policies; • The gaming and leisure market in Macau is developing and the competitive landscape is expected to evolve as more gaming and non-gaming facilities are developed in Macau.
OPERATING RESULTS Operations Our principal operating activities are the provision of services pursuant to a casino contract and the hospitality business in Macau. The Company monitors the operations and evaluates earnings by reviewing the assets and operations of Studio City as one operating segment. Accordingly, we do not present separate segment information.
OPERATING RESULTS Operations Our principal operating activities are the provision of services pursuant to a casino contract and the hospitality business in Macau. The Company monitors the operations and evaluates earnings by reviewing the assets and operations of Studio City as one operating segment. Accordingly, we do not present separate segment information in these operating results.
For any additional financing requirements, we cannot provide assurance that future borrowings will be available. See “Item 3. Key Information — D. Risk Factors — Risks Relating to Our Business — We may not be able to obtain adequate financing on satisfactory terms for our existing business, or at all” for more information.
For any additional financing requirements, we cannot provide assurance that future borrowings will be available. See “Item 3. Key Information — D. Risk Factors — Risks Relating to Our Business — We may not be able to obtain adequate financing on satisfactory terms, or at all” for more information.
Net cash provided by financing activities of US$643.1 million in 2022 was attributable to the proceeds from the issuance of the 2027 Notes in the aggregate principal amount of US$350.0 million and net proceeds from issuance of shares of US$299.2 million, partially offset by payments of deferred financing costs of US$6.1 million.
Net cash provided by financing activities of US$643.1 million in 2022 was attributable to the proceeds from the issuance of the 2027 Notes in the aggregate principal amount of US$350.0 million and net proceeds from issuance of shares of US$299.2 million, partially offset by payments of financing costs of US$6.1 million.
We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us. Studio City Company has a corporate rating of “B+” with a positive outlook by Standard & Poor’s.
We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us. Studio City Company has a corporate rating of “B+” with a stable outlook by Standard & Poor’s.
However, if actual experience differs from the assumptions and other considerations used in estimating amounts reflected in the consolidated financial statements, the resulting changes could have a material adverse effect on the consolidated financial statements. See note 2 to the consolidated financial statements for further information on significant accounting policies. 108 Table of Contents
However, if actual experience differs from the assumptions and other considerations used in estimating amounts reflected in the consolidated financial statements, the resulting changes could have a material adverse effect on the consolidated financial statements. See note 2 to the consolidated financial statements for further information on significant accounting policies. 105 Table of Contents
See “Special Note Regarding Forward-Looking Statements” regarding these statements. Overview We are a holding company and, through our subsidiaries, operate the non-gaming businesses of Studio City. Studio City Casino is operated by the Gaming Operator, one of the subsidiaries of Melco Resorts and a 92 Table of Contents holder of a gaming concession.
See “Special Note Regarding Forward-Looking Statements” regarding these statements. Overview We are a holding company and, through our subsidiaries, operate the non-gaming businesses of Studio City. Studio City Casino is operated by the Gaming Operator, one of the subsidiaries of Melco Resorts and a 91 Table of Contents holder of a gaming concession.
We expect to incur capital expenditures in the future as we continue to expand our existing operations. We have relied, and intend in the future to rely, on our operating cash flow and different forms of financing to meet our funding needs and repay our indebtedness, as the case may be.
We expect to incur capital expenditures in the future as we continue to develop our existing operations. We have relied, and intend in the future to rely, on our operating cash flow and different forms of financing to meet our funding needs and repay our indebtedness, as the case may be.
Additionally, Adjusted EBITDA of Studio City included in such Melco Resorts’ annual report does not reflect certain gaming concession related costs and certain intercompany costs related to the table games operations at Studio City Casino. B.
Additionally, Adjusted EBITDA of Studio City included in such Melco Resorts’ annual report does not reflect certain gaming concession related costs and certain intercompany costs related to the gaming operations at Studio City Casino. B.
In addition, we have contingent liabilities arising in the ordinary course of business. Our total long-term indebtedness and other contractual obligations as of December 31, 2023 are summarized below.
In addition, we have contingent liabilities arising in the ordinary course of business. Our total long-term indebtedness and other contractual obligations as of December 31, 2024 are summarized below.
For a discussion of our results of operations for the year ended December 31, 2022 compared with the year ended December 31, 2021, see “Item 5. Operating and Financial Review and Prospects — A.
For a discussion of our results of operations for the year ended December 31, 2023 compared with the year ended December 31, 2022, see “Item 5. Operating and Financial Review and Prospects — A.
Property charges and other expenses of US$1.4 million in 2023 were primarily attributable to payroll costs as a result of departmental restructuring, the litigation claims related to junket player deposits and asset write-offs. Property charges and other expenses of US$5.8 million in 2022 were primarily attributable to payroll costs as a result of departmental restructuring.
Property charges and other expenses of US$1.4 million in 2023 were primarily attributable to payroll costs as a result of departmental restructuring, the litigation claims related to junket player deposits and asset write-offs.
The estimated useful lives are based on factors including the nature of the assets, its relationship to other assets, our operating plans and anticipated use and other economic and legal factors that impose limits. We review periodically the remaining estimated useful lives of the property and equipment.
The useful lives are estimated based on factors including the nature of the assets, its relationship to other assets, our operating plans and anticipated use and other economic and legal factors that impose limits. The remaining estimated useful lives of the property and equipment are periodically reviewed.
Net cash used in investing activities was US$407.2 million in 2021. Net cash used in investing activities of US$161.5 million and US$453.4 million in 2023 and 2022, respectively, was primarily attributable to payments for acquisition of property and equipment of US$156.8 million and US$452.1 million, respectively.
Net cash used in investing activities of US$161.5 million and US$453.4 million in 2023 and 2022, respectively, was primarily attributable to payments for acquisition of property and equipment of US$156.8 million and US$452.1 million, respectively.
The timing of any future debt and equity financing activities will be dependent on our funding needs, our construction schedule, the availability of funds on terms acceptable to us and prevailing market conditions. We may carry out activities from time to time to strengthen our financial position and ability to better fund our business expansion plans.
The timing of any future debt and equity financing activities will be dependent on our funding needs, the availability of funds on terms acceptable to us and prevailing market conditions. We may carry out activities from time to time to strengthen our financial position and ability to better fund our business.
Our effective tax rates in 2023 and 2022 differ from the statutory Macau Complementary Tax rate of 12%, where the Company’s majority operations are located, primarily due to effects of expired tax losses, expenses for which no income tax benefit is receivable, different tax rates of subsidiaries operating in other jurisdictions, income for which no income tax expense is payable and changes in valuation allowances for the relevant years.
Our effective tax rates in 2024 and 2023 differ from the statutory Macau Complementary Tax rate of 12%, where the Company’s majority operations are located, primarily due to the effects of expired tax losses, expenses for which no income tax benefit is receivable, different tax rates of subsidiaries operating in other jurisdictions, income for which no income tax expense is payable and changes in valuation allowances for 96 Table of Contents the relevant years.
Adjusted EBITDA is presented exclusively as supplemental disclosures because management believes it is widely used to measure the performance, and as a basis for valuation, of gaming companies. Management uses Adjusted EBITDA to measure our operating performance and to compare our operating performance with those of our competitors.
Adjusted EBITDA, which is a non-GAAP financial measure, is presented exclusively as supplemental disclosures because management believes it is widely used to measure the performance, and as a basis for valuation, of gaming companies. Management uses Adjusted EBITDA to measure our operating performance and to compare our operating performance with those of our competitors.
Our capital expenditures on an accrual basis amounted to US$68.9 million, US$427.7 million and US$503.7 million for the years ended December 31, 2023, 2022 and 2021, respectively, primarily for the construction, development and enhancement of Studio City.
Our capital expenditures on an accrual basis amounted to US$64.7 million, US$68.9 million and US$427.7 million for the years ended December 31, 2024, 2023 and 2022, respectively, primarily for the construction, development and enhancement of Studio City.
Adjusted EBITDA Our net income/loss before interest, taxes, depreciation, amortization, pre-opening costs, share-based compensation, property charges and other, other non-operating income and expenses, or Adjusted EBITDA, was US$159.2 million, negative US$140.8 million and negative US$56.5 million for the years ended December 31, 2023, 2022 and 2021, respectively.
Adjusted EBITDA Our net income/loss before interest, taxes, depreciation, amortization, pre-opening costs, share-based compensation, property charges and other, other non-operating income and expenses, or Adjusted EBITDA, was US$245.3 million, US$159.2 million and negative US$140.8 million for the years ended December 31, 2024, 2023 and 2022, respectively.
See “Item 4. Information on the Company — B. Business Overview — Regulations — Restrictions on Distribution of Profits Regulations” and “Item 10. Additional Information — D. Exchange Controls.” As of December 31, 2023, we had capital commitments for the construction and acquisition of property and equipment totaling US$14.7 million.
See “Item 4. Information on the Company — B. Business Overview — Regulations — Restrictions on Distribution of Profits Regulations” and “Item 10. Additional Information — D. Exchange Controls.” As of December 31, 2024, we had capital commitments for the construction and acquisition of property and equipment totaling US$16.5 million.
As of December 31, 2023 and 2022, we recorded valuation allowances of US$80.7 million and US$91.1 million, respectively, as management believes that it is more likely than not that these deferred tax assets will not be realized.
As of December 31, 2024 and 2023, we recorded valuation allowances of US$172.7 million and US$80.7 million, respectively, as management believes that it is more likely than not that these deferred tax assets will not be realized.
LIQUIDITY AND CAPITAL RESOURCES We have relied on, and intend to continue to rely on, our cash generated from our operations and our debt and equity financings to meet our financing or refinancing needs. As of December 31, 2023, we recorded US$228.0 million in cash and cash equivalents.
LIQUIDITY AND CAPITAL RESOURCES We have relied on, and intend to continue to rely on, our cash generated from our operations and our debt and equity financings to meet our financing or refinancing needs. As of December 31, 2024, we recorded US$127.6 million in cash and cash equivalents.
We have been able to meet our working capital needs, and we believe that our current available cash and cash equivalents, bank deposits, funds available for drawdown under the 2028 Studio City Senior Secured Credit Facility and any additional equity or debt financings will be adequate to satisfy our current and anticipated operating, debt and capital commitments, as described in “— Other Financing and Liquidity Matters” below.
We have been able to meet our working capital needs, and we believe that our current available cash and cash equivalents, funds available for drawdown under the 2021 Studio City Senior Secured Credit Facility, 98 Table of Contents the 2024 Studio City Senior Secured Credit Facility and any additional equity or debt financings will be adequate to satisfy our current and anticipated operating, debt and capital commitments, as described in “— Other Financing and Liquidity Matters” below.
Year Ended December 31, 2023 2022 2021 (in thousands of US$) Total operating revenues $ 445,538 $ 11,548 $ 106,868 Total operating costs and expenses (474,580 ) (288,764 ) (298,441 ) Operating loss (29,042 ) (277,216 ) (191,573 ) Net loss attributable to Studio City International Holdings Limited $ (133,517 ) $ (326,451 ) $ (252,555 ) Key Performance Indicators (KPIs) We use the following KPIs to evaluate the operations of Studio City Casino, including table games and gaming machines: • Rolling chip volume: the amount of non-negotiable chips wagered and lost by the rolling chip market segment. • Rolling chip win rate: rolling chip table games win (calculated before discounts, commissions, non-discretionary incentives (including the point-loyalty programs) as administered by the Gaming Operator and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis) as a percentage of rolling chip volume. • Mass market table games drop: the amount of table games drop in the mass market table games segment. • Mass market table games hold percentage: mass market table games win (calculated before discounts, commissions, non-discretionary incentives (including the point-loyalty programs) as administered by the Gaming Operator and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis) as a percentage of mass market table games drop. • Table games win: the amount of wagers won net of wagers lost on gaming tables that is retained and recorded as casino revenues.
Year Ended December 31, 2024 2023 2022 (in thousands of US$) Total operating revenues $ 639,145 $ 445,538 $ 11,548 Total operating costs and expenses (600,997 ) (474,580 ) (288,764 ) Operating income (loss) 38,148 (29,042 ) (277,216 ) Net loss attributable to Studio City International Holdings Limited $ (96,726 ) $ (133,517 ) $ (326,451 ) Key Performance Indicators (KPIs) We use the following KPIs to evaluate the operations of Studio City Casino, including table games and gaming machines: • Rolling chip volume: the amount of non-negotiable chips wagered and lost by the rolling chip market segment. • Rolling chip win rate: rolling chip table games win (calculated before discounts, commissions, non-discretionary incentives (including the point-loyalty programs) as administered by the Gaming Operator and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis) as a percentage of rolling chip volume. • Mass market table games drop: the amount of table games drop in the mass market table games segment. 92 Table of Contents • Mass market table games hold percentage: mass market table games win (calculated before discounts, commissions, non-discretionary incentives (including the point-loyalty programs) as administered by the Gaming Operator and allocating casino revenues related to goods and services provided to gaming patrons on a complimentary basis) as a percentage of mass market table games drop. • Table games win: the amount of wagers won net of wagers lost on gaming tables that is retained and recorded as casino revenues.
Net Loss Attributable to Studio City International Holdings Limited As a result of the foregoing, we had a net loss attributable to Studio City International Holdings Limited of US$133.5 million in 2023, compared to a net loss attributable to Studio City International Holdings Limited of US$326.5 million in 2022.
Net Loss Attributable to Studio City International Holdings Limited As a result of the foregoing, we had a net loss attributable to Studio City International Holdings Limited of US$96.7 million in 2024, compared to US$133.5 million in 2023.
Operating Results — Year Ended December 31, 2022 Compared to Year Ended December 31, 2021” of our annual report on Form 20-F for the fiscal year ended December 31, 2022, filed with the SEC on March 31, 2023.
Operating Results — Year Ended December 31, 2023 Compared to Year Ended December 31, 2022” of our annual report on Form 20-F for the fiscal year ended December 31, 2023, filed with the SEC on March 22, 2024.
Revenue from casino contract is derived from the provision of facilities for the operations of Studio City Casino by the Gaming Operator and services related thereto pursuant to the Studio City Casino Agreement. Revenue from casino contract was US$155.5 million in 2023, compared with revenue from casino contract of negative US$56.7 million in 2022.
Revenue from casino contract is derived from the provision of facilities for the operations of Studio City Casino by the Gaming Operator and services related thereto pursuant to the Studio City Casino Agreement. Revenue from casino contract was US$259.8 million in 2024, compared with US$155.5 million in 2023.
The increase was primarily attributable to an increased occupancy as a result of a year-over-year increase in inbound tourism in 2023 and the opening of two hotel towers in 2023.
The increase was primarily attributable to the full year operation of two hotel towers opened in 2023 and an increased occupancy as a result of a year-over-year increase in inbound tourism in 2024.
The increase was primarily attributable to the opening of two hotel towers in 2023 and in-line with the increase in room revenues. • Food and beverage, entertainment, mall and retail and other.
The increase was primarily attributable to the full year operation of the two hotel towers opened in 2023 and in-line with the increase in room revenues. • Food and beverage, entertainment, mall and retail and other.
Net cash used in financing activities of US$100.9 million in 2023 was mainly attributable to the settlement of the 2025 Notes Tender Offer.
Net cash used in financing activities of US$183.3 million in 2024 was mainly attributable to the settlement of the 2025 Notes Tender Offer (2024) and the repurchases of 2025 Notes. Net cash used in financing activities of US$100.9 million in 2023 was mainly attributable to the settlement of the 2025 Notes Tender Offer (2023).
Unlike net income/loss, Adjusted EBITDA does not include depreciation and amortization or interest expense and, therefore, does not reflect current or future capital expenditures or the cost of capital. The Company recognizes these limitations and uses Adjusted EBITDA as only one of several comparative tools, together with U.S.
Unlike net income/loss, Adjusted EBITDA does not include depreciation and amortization or interest expense and, therefore, does not reflect current or future capital expenditures or the cost of capital. The Company recognizes these limitations and uses Adjusted EBITDA as only one of several comparative tools, together with U.S. GAAP measurements, to assist in the evaluation of operating performance. Such U.S.
Such activities may include refinancing existing debt, monetizing assets, sale-and-leaseback transactions or other similar activities. In March 2022, Studio City International Holdings Limited completed a US$300 million private placement of shares, or the 2022 Private Placements.
Such activities may include refinancing existing debt, monetizing assets, sale-and-leaseback transactions or other similar activities. In March 2022, Studio City International Holdings Limited completed a US$300 million private placement of shares. The net proceeds from this private placement were US$299.2 million.
The negative Adjusted EBITDA for Studio City in 2022 and 2021 referred to in Melco Resorts’ 2023 annual report on Form 20-F was US$35.7 million and US$36.0 million, respectively, less than the negative Adjusted EBITDA of Studio City contained in this report.
The negative Adjusted EBITDA for Studio City in 2022 referred to in Melco Resorts’ 2024 annual report on Form 20-F was US$35.7 million less than the negative Adjusted EBITDA of Studio City contained in this report.
Non-operating Expenses, Net Net non-operating expenses consisted of interest income, interest expense, net of amounts capitalized, other financing costs, net foreign exchange gains, gain on extinguishment of debt and other non-operating (expenses) income, net. We incurred total net non-operating expenses of US$117.1 million in 2023, compared to US$83.7 million in 2022. • Interest expense, net of amounts capitalized.
Non-operating Expenses, Net Net non-operating expenses consisted of interest income, interest expense, net of amounts capitalized, other financing costs, net foreign exchange (losses) gains, (loss) gain on extinguishment of debt and other non-operating expenses, net. We incurred total net non-operating expenses of US$136.6 million in 2024, compared to US$117.1 million in 2023. • Interest expense, net of amounts capitalized.
In addition, any non-compliance with such laws may result in damage or reputation and/or subject us to lawsuits, fines and other penalties as well as restrictions on our use or transfer of data; • Increases in cybersecurity and ransomware attacks around the world, including in the gaming and hospitality industries and the need to continually evaluate, enhance and improve our internal process, systems and technology infrastructure to comply with the increasing cybersecurity, data privacy and data protection laws, regulations and requirements; and • Gaming promoters in Macau have experienced significantly increased regulatory scrutiny that has resulted in the cessation of business of many gaming promoters.
In addition, any non-compliance with such laws may result in damage or reputation and/or subject us to lawsuits, fines and other penalties as well as restrictions on our use or transfer of data; and • Increases in cybersecurity and ransomware attacks around the world, including in the gaming and hospitality industries and the need to continually evaluate, enhance and improve our internal process, systems and technology infrastructure to comply with the increasing cybersecurity, data privacy and data protection laws, regulations and requirements.
The Adjusted EBITDA for Studio City in 2023 referred to in Melco Resorts’ 2023 annual report on Form 20-F was US$47.6 million more than the Adjusted EBITDA of Studio City contained in this report.
The Adjusted EBITDA for Studio City in 2024 and 2023 referred to in Melco Resorts’ 2024 annual report on Form 20-F were US$95.9 million and US$47.6 million, respectively, more than the Adjusted EBITDA of Studio City contained in this report.
Year Ended December 31, 2023 2022 2021 (in thousands of US$) Net cash used in operating activities $ (18,894 ) $ (178,775 ) $ (136,841 ) Net cash used in investing activities (161,540 ) (453,395 ) (407,235 ) Net cash (used in) provided by financing activities (100,902 ) 643,109 471,508 Effect of exchange rate on cash, cash equivalents and restricted cash (147 ) (705 ) (3,372 ) (Decrease) increase in cash, cash equivalents and restricted cash (281,483 ) 10,234 (75,940 ) Cash, cash equivalents and restricted cash at beginning of year 509,653 499,419 575,359 Cash, cash equivalents and restricted cash at end of year $ 228,170 $ 509,653 $ 499,419 Operating Activities Operating cash flows are generally affected by changes in operating income and certain operating assets and liabilities, including the receivables related to the revenue from casino contract and hotel operations, as well as the non-gaming business, including food and beverage, entertainment, mall, retail and other, which are conducted primarily on a cash basis.
Year Ended December 31, 2024 2023 2022 (in thousands of US$) Net cash provided by (used in) operating activities $ 189,899 $ (18,894 ) $ (178,775 ) Net cash used in investing activities (108,461 ) (161,540 ) (453,395 ) Net cash (used in) provided by financing activities (183,263 ) (100,902 ) 643,109 Effect of exchange rate on cash, cash equivalents and restricted cash 1,419 (147 ) (705 ) (Decrease) increase in cash, cash equivalents and restricted cash (100,406 ) (281,483 ) 10,234 Cash, cash equivalents and restricted cash at beginning of year 228,170 509,653 499,419 Cash, cash equivalents and restricted cash at end of year $ 127,764 $ 228,170 $ 509,653 Operating Activities Operating cash flows are generally affected by changes in operating income and certain operating assets and liabilities, including the receivables related to the revenue from casino contract and hotel operations, as well as the non-gaming business, including food and beverage, entertainment, mall, retail and other, which are conducted primarily on a cash basis.
Other Financing and Liquidity Matters We may obtain financing in the form of, among other things, equity or debt, including additional bank loans or high yield, mezzanine or other debt, or rely on our operating cash flow to fund the development of our projects. We are a growing company with significant financial needs.
Other Financing and Liquidity Matters We may obtain financing in the form of, among other things, equity or debt, including additional bank loans or high yield, mezzanine or other debt, or rely on our operating cash flow to fund the maintenance and development of our projects.
If the undiscounted cash flows do not exceed the carrying value, we then record an impairment charge based on the fair value of the asset group, typically measured using a discounted cash flow model involving significant assumptions, such as discount rates. If an asset is still under development, future cash flows include remaining construction costs.
If the sum of undiscounted cash flows does not exceed the carrying value, then an impairment is measured based on fair value compared to carrying value, with fair value typically based on a discounted cash flow model involving significant assumptions, such as discount rates. If an asset is still under development, future cash flows include remaining construction costs.
According to the DSEC, visitor arrivals to Macau increased by 395% on a year-over-year basis in 2023 as compared to 2022 while, according to the DICJ, gross gaming revenues in Macau rose by 334% on a year-over-year basis in 2023.
According to the DSEC, visitor arrivals to Macau increased by 23.8% on a year-over-year basis in 2024 as compared to 2023 while, according to the DICJ, gross gaming revenues in Macau rose by 23.9% on a year-over-year basis in 2024.
In 2023 and 2022, total gaming taxes and costs incurred in connection with the on-going operation of Studio City Casino deducted from gross gaming revenues were US$756.9 million and US$227.9 million, respectively, which included (i) gaming taxes imposed on the gross gaming revenue of US$364.9 million and US$66.8 million, respectively; (ii) the complimentary services provided by us to Studio City Casino’s gaming patrons of US$113.9 million and US$22.9 million, respectively; (iii) shared administrative services and shuttle bus transportation services provided by us to Studio City Casino of US$36.4 million and US$17.9 million, respectively and (iv) remaining costs of US$241.7 million and US$120.3 million, respectively, primarily representing gaming-related staff costs and other gaming-related costs, including certain gaming concession related costs and costs related to table games operations at Studio City Casino. • Rooms.
In 2024 and 2023, total gaming taxes and costs incurred in connection with the on-going operation of Studio City Casino deducted from gross gaming revenues were US$1,055.0 million and US$756.9 million, respectively, which included (i) gaming taxes imposed on the gross gaming revenues of US$526.0 million and US$364.9 million, respectively; (ii) the complimentary services provided by us to Studio City Casino’s gaming patrons of US$150.1 million and US$113.9 million, respectively; (iii) shared administrative services and shuttle bus transportation services provided by us to Studio City Casino of US$50.5 million and US$36.4 million, respectively; and (iv) remaining costs of US$328.4 million and US$241.7 million, respectively, primarily representing gaming-related staff costs and other gaming-related costs, including certain gaming concession related costs and costs related to gaming operations at Studio City Casino. • Rooms.
We generate room revenues from Studio City hotels consisting of the Celebrity Tower, the all-suite Star Tower, the Epic Tower and the W Macau. Our room revenues increased by US$93.8 million, or 523.7%, to US$111.7 million in 2023 from US$17.9 million in 2022.
We generate room revenues from Studio City hotels consisting of the Celebrity Tower, the all-suite Star Tower, the Epic Tower and the W Macau. Our room revenues increased by US$49.0 million, or 43.8%, to US$160.7 million in 2024 from US$111.7 million in 2023.
Expenses related to food and beverage, entertainment, mall and retail and other, which primarily represent the costs of operating the respective non-gaming services at Studio City and respective payroll expenses, increased by US$82.0 million, or 256.6% to US$114.0 million in 2023 from US$32.0 million in 2022.
Expenses related to food and beverage, entertainment, mall and retail and other, which primarily represent the costs of operating the respective non-gaming services at Studio City and respective payroll expenses, increased by US$22.2 million, or 19.5% to US$136.2 million in 2024 from US$114.0 million in 2023.
The higher pre-opening costs in 2023 were mainly related to the opening of the Phase 2 project. • Amortization of land use right. Amortization expenses for the land use right continued to be recognized on a straight-line basis at an annual rate of US$3.3 million in both 2023 and 2022. • Depreciation and amortization .
Pre-opening costs in 2024 were mainly related to the Studio City Cinema opened in June 2024. • Amortization of land use right. Amortization expenses for the land use right continued to be recognized on a straight-line basis at an annual rate of US$3.3 million in both 2024 and 2023. • Depreciation and amortization .
The following table sets forth our gross indebtedness as of December 31, 2023: Issuer As of December 31, 2023 (in thousands of US$) 2028 Studio City Senior Secured Credit Facility Studio City Company $ 128 2025 Notes Studio City Finance 397,000 2027 Notes Studio City Company 350,000 2028 Notes Studio City Finance 500,000 2029 Notes Studio City Finance 1,100,000 Total $ 2,347,128 Major changes in our indebtedness during the year ended and subsequent to December 31, 2023 are summarized below.
The following table sets forth our gross indebtedness as of December 31, 2024: Issuer As of December 31, 2024 (in thousands of US$) 2021 Studio City Senior Secured Credit Facility Studio City Company $ 129 2025 Notes Studio City Finance 221,622 2027 Notes Studio City Company 350,000 2028 Notes Studio City Finance 500,000 2029 Notes Studio City Finance 1,100,000 Total $ 2,171,751 Major changes in our indebtedness during the year ended December 31, 2024 are summarized below.
Studio City’s average daily rate, occupancy rate and REVPAR were US$153, 90% and US$137, respectively, in 2023, as compared to US$111, 28% and US$31, respectively, in 2022. • Food and beverage, entertainment, mall and retail and other.
Studio City’s average daily rate, occupancy rate and REVPAR were US$165, 96% and US$159, respectively, in 2024, as compared to US$153, 90% and US$137, respectively, in 2023. • Food and beverage, entertainment, mall and retail and other.
Financing Activities Net cash used in financing activities was US$100.9 million in 2023, as compared to net cash provided by financing activities of US$643.1 million in 2022. Net cash provided by financing activities was US$471.5 million in 2021.
Financing Activities Net cash used in financing activities was US$183.3 million in 2024, as compared to US$100.9 million in 2023. Net cash provided by financing activities was US$643.1 million in 2022.
As these volumes are the denominator used in calculating win rate or hold percentage, with the same use of gaming win as the numerator, the win rate is generally lower in the rolling chip market segment than the hold percentage in the mass market table games segment. 94 Table of Contents Studio City Casino’s expected rolling chip win rate is 2.85% to 3.15%.
As these volumes are the denominator used in calculating win rate or hold percentage, with the same use of gaming win as the numerator, the win rate is generally lower in the rolling chip market segment than the hold percentage in the mass market table games segment.
Payments Due by Period Less than 1 year 1-3 years 3-5 years More than 5 years Total (in millions of US$) Long-term debt obligations (1) : 2028 Studio City Senior Secured Credit Facility $ — $ — $ 0.1 $ — $ 0.1 2025 Notes — 397.0 — — 397.0 2027 Notes — — 350.0 — 350.0 2028 Notes — — 500.0 — 500.0 2029 Notes — — — 1,100.0 1,100.0 Fixed interest payments 135.8 236.8 146.8 2.1 521.5 Operating leases (2) 1.1 2.3 2.3 30.2 35.9 Construction costs and property and equipment retention payables 21.7 — — — 21.7 Other contractual commitments: Construction costs and property and equipment acquisition commitments 14.3 0.4 — — 14.7 Total contractual obligations $ 172.9 $ 636.5 $ 999.2 $ 1,132.3 $ 2,940.9 (1) See note 10 to the consolidated financial statements included elsewhere in this annual report for further details on these debt facilities.
Payments Due by Period Less than 1 year 1-3 years 3-5 years More than 5 years Total (in millions of US$) Long-term debt obligations (1) : 2021 Studio City Senior Secured Credit Facility $ — $ — $ 0.1 $ — $ 0.1 2025 Notes 221.6 — — — 221.6 2027 Notes — 350.0 — — 350.0 2028 Notes — — 500.0 — 500.0 2029 Notes — — 1,100.0 — 1,100.0 Fixed interest payments 119.2 202.6 58.5 — 380.3 Operating leases (2) 1.6 2.3 2.3 29.2 35.4 Construction costs and property and equipment retention payables 5.3 — — — 5.3 Other contractual commitments: Construction costs and property and equipment acquisition commitments 16.1 0.4 — — 16.5 Total contractual obligations $ 363.8 $ 555.3 $ 1,660.9 $ 29.2 $ 2,609.2 (1) See note 10 to the consolidated financial statements included elsewhere in this annual report for further details on these debt facilities.
Operating Loss As a result of the foregoing, we had an operating loss of US$29.0 million in 2023, compared to an operating loss of US$277.2 million in 2022.
Operating Income/Loss As a result of the foregoing, we had an operating income of US$38.1 million in 2024, compared to an operating loss of US$29.0 million in 2023.
Net Loss Attributable to Participation Interest Our net loss attributable to participation interest was US$12.6 million in 2023, compared to a net loss attributable to participation interest of US$34.9 million in 2022.
Net Loss Attributable to Participation Interest Our net loss attributable to participation interest was US$9.1 million in 2024, compared to US$12.6 million in 2023.
Our services fee revenues, which primarily consist of certain shared administrative services and shuttle bus transportation services to Studio City Casino, increased by US$18.6 million, or 84.9%, to US$40.5 million in 2023 from US$21.9 million in 2022.
Our services fee revenues, which primarily consist of certain shared administrative services and shuttle bus transportation services to Studio City Casino, increased by US$19.1 million, or 47.1%, to US$59.5 million in 2024 from US$40.5 million in 2023.
The change was primarily attributable to softer performance of Studio City’s operations, partially offset by the decreased working capital needed for operations. 100 Table of Contents Investing Activities Net cash used in investing activities was US$161.5 million in 2023, as compared to net cash used in investing activities of US$453.4 million in 2022.
The change was primarily attributable to improved performance of Studio City’s operations, partially offset by the increased working capital needed for operations. Investing Activities Net cash used in investing activities was US$108.5 million in 2024, as compared to US$161.5 million in 2023.
Studio City Casino generated gross gaming revenues of US$912.4 million and US$171.2 million in 2023 and 2022, respectively, before the deduction by the Gaming Operator of gaming taxes and the costs incurred in connection with its on-going operation of Studio City Casino pursuant to the Studio City Casino Agreement.
Studio City Casino generated gross gaming revenues of US$1.31 billion and US$0.91 billion in 2024 and 2023, respectively, before the deduction by the Gaming Operator of gaming taxes and the costs incurred in connection with its on-going operation of Studio City Casino pursuant to the Studio City Casino Agreement.
(2) See note 11 to the consolidated financial statements included elsewhere in this annual report for further details on these lease liabilities. 103 Table of Contents For further details for our commitments and contingencies, see note 18 to the consolidated financial statements included elsewhere in this annual report.
(2) See note 11 to the consolidated financial statements included elsewhere in this annual report for further details on these lease liabilities.
Net loss attributable to Studio City International Holdings Limited for the year ended December 31, 2023 was US$133.5 million, as compared to a net loss attributable to Studio City International Holdings Limited of 93 Table of Contents US$326.5 million for the year ended December 31, 2022.
Net loss attributable to Studio City International Holdings Limited for the year ended December 31, 2024 was US$96.7 million, as compared to US$133.5 million for the year ended December 31, 2023.
Such expenses primarily consist of payroll expenses, utilities, marketing and advertising costs, repairs and maintenance, legal and professional fees, and fees paid to the Master Service Providers for shared corporate services provided to non-gaming departments. Expenses relating to services fee revenues are also included in the general and administrative expenses.
General and administrative expenses were US$171.3 million and US$115.2 million in 2024 and 2023, respectively. Such expenses primarily consist of payroll expenses, utilities, marketing and advertising costs, repairs and maintenance, legal and professional fees, and fees paid to the Master Service Providers for shared corporate services provided to non-gaming departments.
Costs related to casino contract, which mainly represent (1) services fees for shared corporate services provided by the Master Service Providers pursuant to the Management and Shared Services Arrangements and (2) management payroll expenses, are relatively fixed in nature and amounted to US$28.8 million and US$29.9 million in 2023 and 2022, respectively. • Rooms.
Costs related to casino contract, which mainly represent (1) services fees for shared corporate services provided by the Master Service Providers pursuant to the Management and Shared Services Arrangements; and (2) management payroll expenses, increased by US$5.9 million, or 20.3%, to US$34.7 million in 2024 from US$28.8 million in 2023.
Reconciliation of Net Loss Attributable to Studio City International Holdings Limited to Adjusted EBITDA Year Ended December 31, 2023 2022 2021 (in thousands of US$) Net loss attributable to Studio City International Holdings Limited $ (133,517 ) $ (326,451 ) $ (252,555 ) Net loss attributable to participation interest (12,567 ) (34,856 ) (49,447 ) Net loss (146,084 ) (361,307 ) (302,002 ) Income tax (benefit) expense (81 ) 382 (457 ) Interest and other non-operating expenses, net 117,123 83,709 110,886 Depreciation and amortization 169,397 126,956 127,634 Property charges and other 1,407 5,799 6,031 Share-based compensation — 361 438 Pre-opening costs 17,451 3,263 984 Adjusted EBITDA $ 159,213 $ (140,837 ) $ (56,486 ) Adjusted EBITDA margin (1) 35.7 % (1,219.6 )% (52.9 )% (1) Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by total operating revenues.
Investors are encouraged to review the reconciliation of the historical non-GAAP financial measure to its most directly comparable GAAP financial measure. 97 Table of Contents Reconciliation of Net Loss Attributable to Studio City International Holdings Limited to Adjusted EBITDA Year Ended December 31, 2024 2023 2022 (in thousands of US$) Net loss attributable to Studio City International Holdings Limited $ (96,726 ) $ (133,517 ) $ (326,451 ) Net loss attributable to participation interest (9,105 ) (12,567 ) (34,856 ) Net loss (105,831 ) (146,084 ) (361,307 ) Income tax expense (benefit) 7,352 (81 ) 382 Interest and other non-operating expenses, net 136,627 117,123 83,709 Depreciation and amortization 205,060 169,397 126,956 Property charges and other 1,318 1,407 5,799 Share-based compensation — — 361 Pre-opening costs 807 17,451 3,263 Adjusted EBITDA $ 245,333 $ 159,213 $ (140,837 ) Adjusted EBITDA margin (1) 38.4 % 35.7 % (1,219.6 )% (1) Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by total operating revenues.
Our revenues generated from food and beverage, entertainment, mall and retail and other increased by US$109.4 million, or 385.1%, to US$137.8 million in 2023 from US$28.4 million in 2022, primarily attributable to the opening of an indoor waterpark in April 2023, the launch of residency concerts in the same month as well as an increase in business activities as a result of a year-over-year increase in inbound tourism in 2023. • Services fee.
Our revenues generated from food and beverage, entertainment, mall and retail and other increased by US$21.2 million, or 15.4%, to 94 Table of Contents US$159.1 million in 2024 from US$137.8 million in 2023, primarily attributable to the increase in business activities as a result of a year-over-year increase in inbound tourism in 2024, partially offset by lower revenues from residency concerts. • Services fee.
Operating Costs and Expenses Our total operating costs and expenses increased by US$185.8 million, or 64.3%, to US$474.6 million in 2023 from US$288.8 million in 2022. • Costs related to casino contract.
Operating Costs and Expenses Our total operating costs and expenses increased by US$126.4 million, or 26.6%, to US$601.0 million in 2024 from US$474.6 million in 2023. • Costs related to casino contract.
Other financing costs, which were associated with the 2028 Studio City Senior Secured Credit Facility, were US$0.4 million in both 2023 and 2022. • Gain on extinguishment of debt. Gain on extinguishment of debt was US$1.6 million in 2023 and was primarily associated with the 2025 Notes Tender Offer. No gain on extinguishment of debt was incurred in 2022.
Other financing costs in 2024 were US$0.6 million, which were associated with the 2021 Studio City Senior Secured Credit Facility and the 2024 Studio City Senior Secured Credit Facility, compared to US$0.4 million in 2023, which were associated with the 2021 Studio City Senior Secured Credit Facility. • Loss/Gain on extinguishment of debt.
Cash within our group is primarily transferred between our subsidiaries through intercompany loan arrangements. Financing raised by Studio City International Holdings Limited has been transferred to our financing and operating subsidiaries through the use of equity capital contributions or intercompany loan arrangements.
Financing raised by Studio City International Holdings Limited has been transferred to our financing and operating subsidiaries through the use of equity capital contributions or intercompany loan arrangements. In 2024, excluding cash transferred for the purpose of the settlement of intragroup charges, no cash has been transferred to our holding company, Studio City International Holdings Limited, from its subsidiaries.
Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity.
We have not entered into any derivative contracts that are indexed to our ordinary shares and classified as shareholder’s equity, or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity.
As of December 31, 2023, 2022 and 2021, we operated in one geographical area, Macau, where we generated our revenue and where our long-lived assets were located. Our operations in 2023 benefited from the relaxation of travel restrictions and quarantine requirements as well as opening of our Phase 2 project.
As of December 31, 2024, 2023 and 2022, we operated in one geographical area, Macau, where we generated our revenue and where our long-lived assets were located.
We recorded net cash used in operating activities of US$18.9 million in 2023, as compared to net cash used in operating activities of US$178.8 million in 2022. The change was primarily attributable to improved performance of Studio City’s operations as described in the foregoing sections, partially offset by the increased working capital needed for operations.
The change was primarily attributable to improved performance of Studio City’s operations which resulted in a decrease in net loss in 2024, as well as net receipt from affiliated companies for operating purpose in 2024. We recorded net cash used in operating activities of US$18.9 million in 2023, as compared to US$178.8 million in 2022.
This increase is attributable to an increase of gaming machine handle to US$2.48 billion in 2023 from US$0.66 billion in 2022, and an increase in gaming machine win rate to 3.3% in 2023 from 2.8% in 2022.
Gaming machine revenue increased to US$111.7 million in 2024 from US$82.8 million in 2023. This increase is attributable to an increase of gaming machine handle to US$3.41 billion in 2024 from US$2.48 billion in 2023, with a stable gaming machine win rate at 3.3% in both 2024 and 2023.
E. CRITICAL ACCOUNTING ESTIMATES Management’s discussion and analysis of our results of operations and liquidity and capital resources are based on our consolidated financial statements. We prepare our consolidated financial statements in conformity with U.S.
E. CRITICAL ACCOUNTING ESTIMATES Management’s discussion and analysis of our results of operations and liquidity and capital resources are based on our consolidated financial statements. Our consolidated financial statements were prepared in conformity with U.S. GAAP. Certain of our accounting policies require that management applies significant judgment in defining the appropriate assumptions integral to financial estimates.
Net cash used in investing activities of US$407.2 million in 2021 was primarily attributable to payments for acquisition of property and equipment of US$400.4 million, funds to an affiliated company of US$4.4 million and payments for acquisition of intangible assets of US$4.1 million, partially offset by proceeds from the sale of property and equipment and other long-term assets of US$1.7 million.
Net cash used in investing activities was US$453.4 million in 2022. 99 Table of Contents Net cash used in investing activities of US$108.5 million in 2024 was attributable to payments for acquisition of property and equipment of US$86.8 million and payments to an affiliated company for other long-term assets of US$31.3 million, partially offset by proceeds from sale of property and equipment of US$9.6 million.
The Company has significant uses of cash flows, including capital expenditures, interest payments, debt principal repayments, taxes and other recurring and nonrecurring charges, which are not reflected in Adjusted EBITDA. Also, the Company’s calculation of Adjusted EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited.
GAAP measurements include operating income/loss, net income/loss, cash flows from operations and cash flow data. The Company has significant uses of cash flows, including capital expenditures, interest payments, debt principal repayments, taxes and other recurring and nonrecurring charges, which are not reflected in Adjusted EBITDA.
The increase was primarily due to the opening of the Phase 2 project and the increase in business activities in 2023. • Pre-opening costs. Pre-opening costs were US$17.5 million in 2023 as compared to US$3.3 million in 2022. Such costs primarily represent personnel, marketing and other costs incurred prior to the opening of new or start-up operations.
Pre-opening costs were US$0.8 million in 2024 as compared to US$17.5 million in 2023. Such costs primarily represent personnel, marketing and other costs incurred prior to the opening of new or start-up operations. The higher pre-opening costs in 2023 were mainly related to the Studio City Phase 2 which two hotel towers progressively opened in April and September of 2023.
Mass market table games revenue increased to US$783.6 million in 2023 from US$131.3 million in 2022, attributable to an increase in mass market table games drop, partially offset by a decrease in mass market table games hold percentage. Mass market table games drop increased to US$2.87 billion in 2023 from US$0.46 billion in 2022.
Mass market table games revenue increased to US$1.13 billion in 2024 from US$0.78 billion in 2023, attributable to an increase in mass market table games drop to US$3.68 billion in 2024 from US$2.87 billion in 2023, and an increase in mass market table games hold percentage to 30.6% in 2024 from 27.3% in 2023.
We recorded net cash used in operating activities of US$178.8 million in 2022, as compared to net cash used in operating activities of US$136.8 million in 2021.
We recorded net cash provided by operating activities of US$189.9 million in 2024, as compared to net cash used in operating activities of US$18.9 million in 2023.
Further, the HK$233.0 million (equivalent to US$29.8 million) revolving credit facility under the 2028 Studio City Senior Secured Credit Facility is available for future drawdown as of December 31, 2023, subject to certain conditions precedent. 99 Table of Contents As of December 31, 2023, restricted cash of US$0.1 million primarily represented the cash collateral in relation to the 2028 Studio City Senior Secured Credit Facility.
The HK$233.0 million (equivalent to US$30.0 million) revolving credit facility under the 2021 Studio City Senior Secured Credit Facility and HK$1.945 billion (equivalent to US$250.5 million) under the 2024 Studio City Senior Secured Credit Facility are available for future drawdown as of December 31, 2024, subject to certain conditions precedent.
As not all available rooms are occupied, average daily room rates are normally higher than revenue per available room. Tables games and gaming machines that were not in operation due to government mandated closures or social distancing measures in relation to the COVID-19 outbreak have been excluded.
In 2022, table games and gaming machines that were not in operation due to government mandated closures or social distancing measures in relation to the COVID-19 outbreak have been excluded, while room statistics also exclude rooms that were temporarily closed or provided to staff members due to the COVID-19 outbreak.
Studio City’s VIP rolling chip volume increased to US$2.79 billion in 2023 from US$0.84 billion in 2022. VIP rolling chip win rate decreased to 1.65% in 2023 from 2.56% in 2022.
VIP rolling chip revenue increased to US$77.1 million in 2024 from US$46.0 million in 2023, attributable to an increase in VIP rolling chip win rate, partially offset by a decrease in VIP rolling chip volume. Studio City’s VIP rolling chip volume decreased to US$2.00 billion in 2024 from US$2.79 billion in 2023.
Loss before Income Tax As a result of the foregoing, we had a loss before income tax of US$146.2 million in 2023, compared to a loss before income tax of US$360.9 million in 2022. 97 Table of Contents Income Tax Benefit/Expense Income tax benefit was US$0.1 million in 2023 and was primarily attributable to a deferred income tax benefit as compared to income tax expense of US$0.4 million in 2022 which was primarily attributable to a deferred income tax expense.
Loss before Income Tax As a result of the foregoing, we had a loss before income tax of US$98.5 million in 2024, compared to US$146.2 million in 2023.
Studio City Finance accepted for purchase the 2025 Notes that were validly tendered (and not validly withdrawn) pursuant to the tender offer for a combined aggregate principal amount equal to US$100.0 million. Settlement of such purchase took place on November 28, 2023.
Studio City Finance accepted for purchase an aggregate principal amount of US$100,029,000 of the 2025 Notes that were validly tendered (and not validly withdrawn) pursuant to the 2025 Notes Tender Offer (2024) and settled the purchase on April 24, 2024. In addition, Studio City Finance repurchased US$75.3 million of the 2025 Notes during the year ended December 31, 2024.
On November 9, 2023, Studio City Finance initiated the 2025 Notes Tender Offer. The tender offer expired on December 8, 2023. An aggregate principal amount of US$317.5 million of the 2025 Notes was tendered on November 22, 2023, the early tender date.
On April 8, 2024, Studio City Finance initiated the 2025 Notes Tender Offer (2024) to purchase up to an aggregate principal amount of US$100,000,000 of the 2025 Notes. An aggregate principal amount of US$307,150,000 of the 2025 Notes were tendered on the early tender date on April 19, 2024.
We have not entered into any material financial guarantees or other commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our ordinary shares and classified as shareholder’s equity, or that are not reflected in our consolidated financial statements.
For further details for our commitments and contingencies, see note 18 to the consolidated financial statements included elsewhere in this annual report. 102 Table of Contents We have not entered into any material financial guarantees or other commitments to guarantee the payment obligations of any third parties.

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Biggest changeThe types of awards that may be granted under the share incentive plan of Melco Resorts include options, incentive share options, restricted shares, share appreciation rights, dividend equivalents, share 112 Table of Contents payments, deferred shares and restricted share units.
Biggest changeHowever, our directors, employees and consultants are eligible to participate in the share incentive plan of Melco Resorts, which is open to directors, employees and consultants of Melco Resorts and any parent or subsidiary of Melco Resorts. 109 Table of Contents The types of awards that may be granted under the share incentive plan of Melco Resorts include options, incentive share options, restricted shares, share appreciation rights, dividend equivalents, share payments, deferred shares and restricted share units.
The nominating and corporate governance committee will be responsible for, among other things, assisting our board in discharging its responsibilities regarding: • the identification of qualified candidates to become members and chairs of the board committees and to fill any such vacancies, and reviewing the appropriateness of the continued service of directors; • ensuring that our board meets the criteria for independence under the New York Stock Exchange corporate governance rules and nominating directors who meet such independence criteria; • oversight of our compliance with legal and regulatory requirements, in particular the legal and regulatory requirements of Macau, the Cayman Islands, the SEC and the New York Stock Exchange; • the development and recommendation to our board of a set of corporate governance principles applicable to our Company; and 116 Table of Contents • the disclosure, in accordance with our relevant policies, of any material information (other than that regarding the quality or integrity of our financial statements). • The other duties of the nominating and corporate governance committee include: • making recommendations to our board for its approval, the appointment or re-appointment of any members of our board and the chairs and members of its committees, including evaluating any succession planning; • reviewing on an annual basis the appropriate skills, knowledge and characteristics required of board members and of the committees of our board and making any recommendations to improve the performance of our board and its committees; • developing and recommending to our board such policies and procedures with respect to nomination or appointment of members of our board and chairs and members of its committees or other corporate governance matters as may be required pursuant to any SEC or New York Stock Exchange rules, or otherwise considered desirable and appropriate; • developing a set of corporate governance principles and reviewing such principles at least annually; • deciding whether any material information which is brought to its attention (other than that regarding the quality or integrity of our financial statements) should be disclosed; • reviewing and monitoring the training and continuous professional development of our directors and senior management; • developing, reviewing and monitoring the code of conduct and compliance manual applicable to staff and directors; • together with the board, evaluating the performance of the committee on an annual basis; • assessing the adequacy of the charter of the nominating and corporate governance committee; and • co-operating with the other board committees in any areas of overlapping responsibilities.
The nominating and corporate governance committee will be responsible for, among other things, assisting our board in discharging its responsibilities regarding: • the identification of qualified candidates to become members and chairs of the board committees and to fill any such vacancies, and reviewing the appropriateness of the continued service of directors; • ensuring that our board meets the criteria for independence under the New York Stock Exchange corporate governance rules and nominating directors who meet such independence criteria; • oversight of our compliance with legal and regulatory requirements, in particular the legal and regulatory requirements of Macau, the Cayman Islands, the SEC and the New York Stock Exchange; 113 Table of Contents • the development and recommendation to our board of a set of corporate governance principles applicable to our Company; and • the disclosure, in accordance with our relevant policies, of any material information (other than that regarding the quality or integrity of our financial statements). • The other duties of the nominating and corporate governance committee include: • making recommendations to our board for its approval, the appointment or re-appointment of any members of our board and the chairs and members of its committees, including evaluating any succession planning; • reviewing on an annual basis the appropriate skills, knowledge and characteristics required of board members and of the committees of our board and making any recommendations to improve the performance of our board and its committees; • developing and recommending to our board such policies and procedures with respect to nomination or appointment of members of our board and chairs and members of its committees or other corporate governance matters as may be required pursuant to any SEC or New York Stock Exchange rules, or otherwise considered desirable and appropriate; • developing a set of corporate governance principles and reviewing such principles at least annually; • deciding whether any material information which is brought to its attention (other than that regarding the quality or integrity of our financial statements) should be disclosed; • reviewing and monitoring the training and continuous professional development of our directors and senior management; • developing, reviewing and monitoring the code of conduct and compliance manual applicable to staff and directors; • together with the board, evaluating the performance of the committee on an annual basis; • assessing the adequacy of the charter of the nominating and corporate governance committee; and • co-operating with the other board committees in any areas of overlapping responsibilities.
In 2017, Mr. Ho was awarded the Medal of Merit—Tourism by the Macau SAR government for his significant contributions to tourism in the territory. In recognition of Mr. Ho’s excellent directorship and entrepreneurial spirit, he was granted the Business Awards of Macau’s “Leadership Gold Award” in 2015 and honored with “Outstanding Individual Award” at the Industry Community Awards in 2020.
In 2017, Mr. Ho was awarded the Medal of Merit—Tourism by the Macau SAR government for his significant contributions to tourism in the territory. In recognition of Mr. Ho’s directorship and entrepreneurial spirit, he was granted the Business Awards of Macau’s “Leadership Gold Award” in 2015 and honored with “Outstanding Individual Award” at the Industry Community Awards in 2020. Mr.
In addition, our property general manager has agreed not to, for a certain period following termination of his employment: (i) be engaged, concerned or interested in any capacity (other than as a passive investor of not more than 5% of the issued ordinary shares of any company listed on a recognized investment exchange) with any business carried on within, among others, Hong Kong, Macau and the Philippines similar to or in competition with any restricted business, (ii) solicit or seek or endeavor to entice away any business orders of customers or (iii) induce, solicit or entice or endeavor to induce, solicit or entice away, or offer employment or engagement to, certain employees. 117 Table of Contents Our chief financial officer provides services to us pursuant to the Management and Shared Services Arrangements.
In addition, our property general manager has agreed not to, for a certain period following termination of his employment: (i) be engaged, concerned or interested in any capacity (other than as a passive investor of not more than 5% of the issued ordinary shares of any company listed on a recognized investment exchange) with any business carried on within, among others, Hong Kong, Macau and the Philippines similar to or in competition with any restricted business, (ii) solicit or seek or endeavor to entice away any business orders of customers or (iii) induce, solicit or entice or endeavor to induce, solicit or entice away, or offer employment or engagement to, certain employees. 114 Table of Contents Our chief financial officer provides services to us pursuant to the Management and Shared Services Arrangements.
Percentage of voting power of each director and executive officer is calculated by dividing the number of Class A ordinary shares and Class B ordinary shares beneficially owned by such person or group, including shares that such person or group has the right to acquire within 60 days after March 15, 2024, by the sum of (i) 842,864,460 which is the total number of Class A ordinary shares and Class B ordinary shares outstanding as of March 15, 2024, and (ii) the number of Class A ordinary shares and Class B ordinary shares that such person or group has the right to acquire beneficial ownership within 60 days of March 15, 2024.
Percentage of voting power of each director and executive officer is calculated by dividing the number of Class A ordinary shares and Class B ordinary shares beneficially owned by such person or group, including shares that such person or group has the right to acquire within 60 days after March 15, 2025, by the sum of (i) 842,864,460 which is the total number of Class A ordinary shares and Class B ordinary shares outstanding as of March 15, 2025, and (ii) the number of Class A ordinary shares and Class B ordinary shares that such person or group has the right to acquire beneficial ownership within 60 days of March 15, 2025.
The audit and risk committee is responsible for assisting our board in overseeing and monitoring: • the audits of the financial statements of our Company; • the qualifications and independence of our independent auditors; • the performance of our independent auditors; • the accounting and financial reporting processes of our Company and the integrity of our systems of internal accounting and financial controls; 114 Table of Contents • legal and regulatory issues relating to the financial statements of our Company, including oversight of the independent auditors, review of the financial statements and related material, internal audit process and the procedure for receiving complaints regarding accounting, internal accounting controls, auditing or other related matters; • the disclosure, in accordance with our relevant policies, of any material information regarding the quality or integrity of our financial statements; • the integrity and effectiveness of our internal audit function; and • the Company’s risk management policies, procedures and practices. • The other duties of the audit and risk committee include: • reviewing and recommending to our board for approval, the appointment, re-appointment or removal of the independent auditor, after considering its annual performance evaluation of the independent auditor; • approving the remuneration and terms of engagement of the independent auditor and pre-approving all auditing and non-auditing services permitted to be performed by our independent auditors; • at least annually, obtaining a written report from our independent auditor describing matters relating to its independence and quality control procedures; • discussing with our independent auditor and our management, among other things, the audits of the financial statements, including whether any material information brought to their attention should be disclosed, issues regarding accounting and auditing principles and practices and the management’s internal control report; • reviewing and recommending the financial statements for inclusion within our quarterly earnings releases and to our board for inclusion in our annual reports; • approving all material related party transactions brought to its attention, without further approval of our board; • establishing and overseeing procedures for the handling of complaints and whistleblowing; • approving the internal audit charter and annual audit plans, and undertaking an annual performance evaluation of the internal audit function; • assessing senior management’s policies and procedures to identify, accept, mitigate, allocate or otherwise manage various types of risks that may materially impact the Company’s business, strategy, operation, financials and reputation, including without limitation, legal, compliance and operational risks and other evolving risks such as cybersecurity threats, and making recommendations with respect to our risk management process for the board’s approval; • reviewing our financial controls, internal control and risk management systems, and discussing with our management the system of internal control and ensuring that our management has discharged its duty to have an effective internal control system including the adequacy of resources, the qualifications and experience of our accounting and financial staff, and their training programs and budget; • together with our board, evaluating the performance of the audit and risk committee on an annual basis; • assessing the adequacy of the charter of the audit and risk committee; and • co-operating with the other board committees in any areas of overlapping responsibilities.
The audit and risk committee is responsible for assisting our board in overseeing and monitoring: • the audits of the financial statements of our Company; • the qualifications and independence of our independent auditors; 111 Table of Contents • the performance of our independent auditors; • the accounting and financial reporting processes of our Company and the integrity of our systems of internal accounting and financial controls; • legal and regulatory issues relating to the financial statements of our Company, including oversight of the independent auditors, review of the financial statements and related material, internal audit process and the procedure for receiving complaints regarding accounting, internal accounting controls, auditing or other related matters; • the disclosure, in accordance with our relevant policies, of any material information regarding the quality or integrity of our financial statements; • the integrity and effectiveness of our internal audit function; and • the Company’s risk management policies, procedures and practices. • The other duties of the audit and risk committee include: • reviewing and recommending to our board for approval, the appointment, re-appointment or removal of the independent auditor, after considering its annual performance evaluation of the independent auditor; • approving the remuneration and terms of engagement of the independent auditor and pre-approving all auditing and non-auditing services permitted to be performed by our independent auditors; • at least annually, obtaining a written report from our independent auditor describing matters relating to its independence and quality control procedures; • discussing with our independent auditor and our management, among other things, the audits of the financial statements, including whether any material information brought to their attention should be disclosed, issues regarding accounting and auditing principles and practices and the management’s internal control report; • reviewing and recommending the financial statements for inclusion within our quarterly earnings releases and to our board for inclusion in our annual reports; • approving all material related party transactions brought to its attention, without further approval of our board; • establishing and overseeing procedures for the handling of complaints and whistleblowing; • approving the internal audit charter and annual audit plans, and undertaking an annual performance evaluation of the internal audit function; • assessing senior management’s policies and procedures to identify, accept, mitigate, allocate or otherwise manage various types of risks that may materially impact the Company’s business, strategy, operation, financials and reputation, including without limitation, legal, compliance and operational risks and other evolving risks such as cybersecurity threats, and making recommendations with respect to our risk management process for the board’s approval; • reviewing our financial controls, internal control and risk management systems, and discussing with our management the system of internal control and ensuring that our management has discharged its duty to have an effective internal control system including the adequacy of resources, the qualifications and experience of our accounting and financial staff, and their training programs and budget; • together with our board, evaluating the performance of the audit and risk committee on an annual basis; • assessing the adequacy of the charter of the audit and risk committee; and • co-operating with the other board committees in any areas of overlapping responsibilities. 112 Table of Contents Compensation Committee Our compensation committee consists of Dominique Mielle, Kevin F.
See “Item 7. Major Shareholders and Related Party Transactions — A. Major Shareholders.” None of our directors or executive officers who are shareholders have different voting rights from other shareholders of our Company. F. DISCLOSURE OF A REGISTRANT’S ACTION TO RECOVER ERRONEOUSLY AWARDED COMPENSATION Not applicable. 119 Table of Contents
See “Item 7. Major Shareholders and Related Party Transactions — A. Major Shareholders.” None of our directors or executive officers who are shareholders have different voting rights from other shareholders of our Company. F. DISCLOSURE OF A REGISTRANT’S ACTION TO RECOVER ERRONEOUSLY AWARDED COMPENSATION Not applicable. 116 Table of Contents
Sullivan held positions of increasing responsibility over his 32 years at Deutsche Bank and Bankers Trust, 111 Table of Contents including Group Head of the loan sales, trading and capital markets division, Asia Head of the leveraged finance division, Group Head of the Asset Based Lending division, Member of the Capital Commitments Committee and Member of the Equity Investment Committee.
Sullivan held positions of increasing responsibility over his 32 years at Deutsche Bank and Bankers Trust, 108 Table of Contents including Group Head of the loan sales, trading and capital markets division, Asia Head of the leveraged finance division, Group Head of the Asset Based Lending division, Member of the Capital Commitments Committee and Member of the Equity Investment Committee.
None of the dedicated staff members performing services solely at Studio City are members of any labor union and neither we nor any of the Master Service Providers are a party to any collective bargaining or similar agreement with such staff. 118 Table of Contents E.
None of the dedicated staff members performing services solely at Studio City are members of any labor union and neither we nor any of the Master Service Providers are a party to any collective bargaining or similar agreement with such staff. 115 Table of Contents E.
He is a vice chairman of the All-China Federation of Industry and Commerce; a member of the Macau Basic Law Promotion Association; a member of the Board of Governors of The Canadian Chamber of Commerce in Hong Kong; a member of the Asia International Leadership Council; honorary advisor of Global Tourism Economy Research Centre; permanent honorary committee member of The Chinese General Chamber of Commerce of Hong Kong; honorary patron of The Canadian Chamber of Commerce in Macao; honorary president of the Macau Research Association for Macau Gaming Law; honorary president of the Association of Property Agents and Real Estate Developers of Macau and a director executive of the Macao Chinese General Chamber of Commerce.
He is a member of the advisory committee of the All-China Federation of Industry and Commerce; a member of the Macau Basic Law Promotion Association; a member of the Board of Governors of The Canadian Chamber of Commerce in Hong Kong; a member of the Asia International Leadership Council; honorary advisor of Global Tourism Economy Research Centre; permanent honorary committee member of The Chinese General Chamber of Commerce of Hong Kong; honorary patron of The Canadian Chamber of Commerce in Macao; honorary president of the Macau Research Association for Macau Gaming Law; honorary president of the Association of Property Agents and Real Estate Developers of Macau and a director executive of the Macao Chinese General Chamber of Commerce.
Mielle worked at Libra Investments, Inc. as an associate in the corporate finance department covering middle market companies. Prior to that, she worked at Lehman Brothers as an analyst in the Financial Institutions group, focusing on mergers and acquisitions. Ms. Mielle also serves on the board of directors of Ready Capital Corporation, Tiptree Inc. and Osiris Acquisition Corp. Ms.
Mielle worked at Libra Investments, Inc. as an associate in the corporate finance department covering middle market companies. Prior to that, she worked at Lehman Brothers as an analyst in the Financial Institutions group, focusing on mergers and acquisitions. Ms. Mielle also serves on the board of directors of Ready Capital Corporation and Tiptree Inc. Ms.
Our directors also owe to our Company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge and 113 Table of Contents experience.
Our directors also owe to our Company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge and experience.
SHARE OWNERSHIP Share Ownership of Directors and Members of Senior Management The following table sets forth the beneficial interest of each director and executive officer in our ordinary shares as of March 15, 2024.
SHARE OWNERSHIP Share Ownership of Directors and Members of Senior Management The following table sets forth the beneficial interest of each director and executive officer in our ordinary shares as of March 15, 2025.
Duties of Directors Under Cayman Islands law, our directors owe fiduciary duties to our Company, including a duty of loyalty, a duty to act honestly and a duty to act in what they consider in good faith to be in our best interests. Our directors must also exercise their powers only for a proper purpose.
Duties of Directors Under Cayman Islands law, our directors owe fiduciary duties to our Company, including a duty of loyalty, a duty to act honestly and a duty to act in what they consider in good faith to be in our best interests. Our 110 Table of Contents directors must also exercise their powers only for a proper purpose.
Prior to that, he worked at Price Waterhouse & Co. as part of its New York senior audit staff from 1975 to 1979. Mr. Sullivan is also an independent director of Griffon Corporation and has served on its board, audit and head of finance committees since January 2013. Mr. Sullivan graduated with an M.B.A. in Finance from St.
Prior to that, he worked at Price Waterhouse & Co. as part of its New York senior audit staff from 1975 to 1979. Mr. Sullivan has also been the lead independent director of Griffon Corporation and has served on its board, audit and head of finance committees since January 2013. Mr. Sullivan graduated with an M.B.A. in Finance from St.
Ho became the managing director of Melco International in 2011 and has been its chairman and chief executive officer since March 2006. Mr.
Ho became the managing director of Melco International in 2001 and has been its chairman and chief executive officer since March 2006. Mr.
Lawrence Ho is taken to have interest in these shares as a result of his interest in approximately 59.01% of the total issued shares of Melco International, including his personal interest, interests of the companies which are owned or controlled by persons and/or trusts associated with him, interest of his spouse and interest of a trust in which he is one of the beneficiaries and is taken to have interest under the Securities and Futures Ordinance (Chapter 571, the Laws of Hong Kong).
Lawrence Ho is taken to have interest in these shares as a result of his interest in approximately 61.44% of the total issued shares of Melco International, including his personal interest, interests of the companies which are owned or controlled by persons and/or trusts associated with him, interest of his spouse and interests of trusts in which he is one of the beneficiaries and is taken to have interests under the Securities and Futures Ordinance (Chapter 571, the Laws of Hong Kong).
Prior to joining Melco, Mr. Dean was the General Manager — Compliance (Finance and Administration) at Coles Myer Limited (now known as Wesfarmers Limited) from 2003 until 2006, where he was responsible for the implementation of the Sarbanes-Oxley Act of 2002 compliance processes and other corporate governance compliance programs. Other positions Mr.
Dean was the General Manager — Compliance (Finance and Administration) at Coles Myer Limited (now known as Wesfarmers Limited) from 2003 until 2006, where he was responsible for the implementation of the Sarbanes-Oxley Act of 2002 compliance processes and other corporate governance compliance programs. Other positions Mr.
Akiko Takahashi has been a member of our board of directors since October 2018. Ms. Takahashi is executive vice president and chief of staff to Chairman and CEO of Melco Resorts, and was appointed to this 110 Table of Contents role in June 2019.
Akiko Takahashi has been a member of our board of directors since October 2018. Ms. Takahashi is executive vice president and chief of staff to chairman and chief executive officer of Melco Resorts, and was 107 Table of Contents appointed to this role in June 2019.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS In 2023, we paid an aggregate of US$1.0 million in cash and benefits to our directors and executive officers. We have not set aside or accrued any material amount to provide pension, retirement or other similar benefits to our directors and executive officers.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS In 2024, we paid an aggregate of US$1.2 million in cash and benefits to our directors and executive officers. We have not set aside or accrued any material amount to provide pension, retirement or other similar benefits to our directors and executive officers.
Sullivan 71 Independent Director Nigel Alan Dean 70 Independent Director Kevin Richard Benning 41 Property General Manager Directors Mr. Lawrence Yau Lung Ho has been a member of our board of directors since July 2011. Mr.
Sullivan 72 Independent Director Nigel Alan Dean 71 Independent Director Kevin Richard Benning 42 Property General Manager Directors Mr. Lawrence Yau Lung Ho has been a member of our board of directors since July 2011. Mr.
Mr. Ho has been honored as one of the recipients of the “Asian Corporate Director Recognition Awards” by Corporate Governance Asia magazine for nine years since 2012, and was awarded “Asia’s Best CEO” at the Asian Excellence Awards for the 12 th year in 2023. 109 Table of Contents Mr.
Ho has been honored as one of the recipients of the “Asian Corporate Director Recognition Awards” by Corporate Governance Asia magazine for nine years since 2012, and was awarded “Asia’s Best CEO” at the Asian Excellence Awards for the 13 th year in 2024. 106 Table of Contents Mr.
D. EMPLOYEES Staff There were 5,286, 3,571 and 3,794 dedicated staff members as of December 31, 2023, 2022 and 2021, respectively, performing services solely at Studio City.
D. EMPLOYEES Staff There were 5,848, 5,286 and 3,571 dedicated staff members as of December 31, 2024, 2023 and 2022, respectively, performing services solely at Studio City.
Winkler joined Melco International as the managing director in August 2016 and assumed the role of president and managing director of Melco International since May 2018, and a director of various subsidiaries of Melco International. Before joining Melco International, Mr. Winkler served as a managing director at Moelis & Company, a global investment bank.
Winkler has served as the managing director and the president of Melco International since August 2016 and May 2018, respectively, and a director of various subsidiaries of Melco International. Before joining Melco International, Mr. Winkler served as a managing director at Moelis & Company, a global investment bank.
Compensation Committee Our compensation committee consists of Dominique Mielle, Kevin F. Sullivan, David Anthony Reganato and Nigel Alan Dean, and is chaired by Mr. Dean. Each of Dominique Mielle, Kevin F. Sullivan and 115 Table of Contents Nigel Alan Dean satisfies the “independence” requirements of Section 303A of the New York Stock Exchange Listed Company Manual.
Sullivan, David Anthony Reganato and Nigel Alan Dean, and is chaired by Mr. Dean. Each of Dominique Mielle, Kevin F. Sullivan and Nigel Alan Dean satisfies the “independence” requirements of Section 303A of the New York Stock Exchange Listed Company Manual.
Directors and Executive Officers Age Position/Title Lawrence Yau Lung Ho 47 Director Evan Andrew Winkler 49 Director Clarence Yuk Man Chung 61 Director Geoffrey Stuart Davis 55 Director and Chief Financial Officer Stephanie Cheung 61 Director Akiko Takahashi 70 Director David Anthony Reganato 44 Director Dale Robert Black 60 Director Dominique Mielle 55 Independent Director Kevin F.
Directors and Executive Officers Age Position/Title Lawrence Yau Lung Ho 48 Director Evan Andrew Winkler 50 Director Clarence Yuk Man Chung 62 Director Geoffrey Stuart Davis 56 Director and Chief Financial Officer Stephanie Cheung 62 Director Akiko Takahashi 71 Director David Anthony Reganato 45 Director Dale Robert Black 61 Director Dominique Mielle 56 Independent Director Kevin F.
The following table indicates the distribution of these staff by function pursuant to the Management and Shared Services Arrangements as of December 31, 2023: Function Number of Staff Management, Administrative and Finance 20 Gaming 1,634 Hotel 1,061 Food and Beverage 949 Property Operations 247 Entertainment 304 Marketing 201 W Macau 560 Others 310 Total 5,286 Through the Management and Shared Services Arrangements, we are able to leverage the resources and platform of the Master Service Providers to have qualified staff dedicated to working on our property.
The following table indicates the distribution of these staff by function pursuant to the Management and Shared Services Arrangements as of December 31, 2024: Function Number of Staff Management, Administrative and Finance 17 Gaming 1,773 Hotel 1,316 Food and Beverage 1,093 Property Operations 252 Entertainment 326 Marketing 236 W Macau 496 Others 339 Total 5,848 Through the Management and Shared Services Arrangements, we are able to leverage the resources and platform of the Master Service Providers to have qualified staff dedicated to working on our property.
John’s University and a B.S. degree in Accounting from Fordham University. Mr. Nigel Alan Dean has been a member of our board of directors since October 2018. Mr. Dean was Melco’s Executive Vice President and Chief Internal Auditor from December 2008 until September 2012 and held the title of Director, Internal Audit from December 2006, when he joined Melco.
John’s University and a B.S. degree in Accounting from Fordham University. Mr. Nigel Alan Dean has been a member of our board of directors since October 2018. Mr.
Removed
However, our directors, employees and consultants are eligible to participate in the share incentive plan of Melco Resorts, which is open to directors, employees and consultants of Melco Resorts and any parent or subsidiary of Melco Resorts.
Added
Dean was Melco Resorts’ Executive Vice President and Chief Internal Auditor from December 2008 until September 2012 and held the title of Director, Internal Audit from December 2006, when he joined Melco Resorts. Prior to joining Melco Resorts, Mr.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

24 edited+5 added−1 removed62 unchanged
Biggest changeSuch costs include the costs for allocation of any gaming tables for operation of the Studio City Casino above 26.4% of the Gaming Operator’s overall gaming tables allocated to the Gaming Operator by the Macau government. Studio City Entertainment receives the residual gross gaming revenues and recognizes these amounts as our revenue from the Studio City Casino Agreement.
Biggest changeSuch costs include the costs for utilization of any gaming tables for operation of the Studio City Casino above 26.4% of the Gaming Operator’s overall gaming tables allocated to the Gaming Operator by the Macau government.
Services and Right to Use Direct Agreement On November 26, 2013, Studio City Company, the Gaming Operator, Studio City Holdings Five Limited and the security agent under the 2018 Project Facility, among others, entered into the Services and Right to Use Direct Agreement, which sets forth, among other things, certain restrictions on the rights of the Gaming Operator to (subject to the necessary regulatory approvals being obtained) suspend the continued operation of Studio City Casino and/or terminate the Studio City Casino Agreement.
Services and Right to Use Direct Agreement On November 26, 2013, Studio City Company, the Gaming Operator, Studio City Holdings Five Limited and the security agent under the 2013 Project Facility, among others, entered into the Services and Right to Use Direct Agreement, which sets forth, among other things, certain restrictions on the rights of the Gaming Operator to (subject to the necessary regulatory approvals being obtained) suspend the continued operation of Studio City Casino and/or terminate the Studio City Casino Agreement.
Mr. Ho is the majority shareholder of Melco International, which is the sole shareholder of Melco Leisure and Entertainment Group Limited, or Melco Leisure, which is the majority shareholder of Melco Resorts, a publicly-traded company whose American depositary shares are listed on the Nasdaq Global Select Market.
Mr. Lawrence Ho is the majority shareholder of Melco International, which is the sole shareholder of Melco Leisure and Entertainment Group Limited, or Melco Leisure, which is the majority shareholder of Melco Resorts, a publicly-traded company whose American depositary shares are listed on the Nasdaq Global Select Market.
We believe arbitration provisions in commercial agreements are generally respected by federal courts and state courts of New York. 123 Table of Contents Shareholders’ Agreement In connection with our initial public offering and the Organizational Transactions, we entered into an amended shareholders agreement with Melco Resorts, MCO Cotai and New Cotai which took effect immediately after the completion of our initial public offering (as amended, the “Shareholders’ Agreement”).
We believe arbitration provisions in commercial agreements are generally respected by federal courts and state courts of New York. 120 Table of Contents Shareholders’ Agreement In connection with our initial public offering and the Organizational Transactions, we entered into an amended shareholders agreement with Melco Resorts, MCO Cotai and New Cotai which took effect immediately after the completion of our initial public offering (as amended, the “Shareholders’ Agreement”).
Other than as provided in the table above, reports filed with or furnished to the SEC, public disclosure, including without limitation Schedule 13 filings, and this annual report, we are not aware of any significant change in the percentage ownership held by any major shareholder since January 1, 2021.
Other than as provided in the table above, reports filed with or furnished to the SEC, public disclosure, including without limitation Schedule 13 filings, and this annual report, we are not aware of any significant change in the percentage ownership held by any major shareholder since January 1, 2022.
Studio City Casino Agreement On May 11, 2007, our subsidiary, Studio City Entertainment, and the Gaming Operator entered into a services and right to use agreement (as amended on June 15, 2012, together with the reimbursement agreement of the same date and other agreements or arrangements entered into from time to time regarding the operation of Studio City Casino) pursuant to which the Gaming Operator operated Studio City Casino.
Studio City Casino Agreement On May 11, 2007, our subsidiary, Studio City Entertainment, and the Gaming Operator entered into a services and right to use agreement (as amended on June 15, 2012 and June 23, 2022, together with the reimbursement agreement of the same date and other agreements or arrangements entered into from time to time regarding the operation of Studio City Casino) pursuant to which the Gaming Operator operated Studio City Casino.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. MAJOR SHAREHOLDERS The following table sets forth the beneficial ownership of our ordinary shares as of March 15, 2024 by all persons who are known to us to be the beneficial owners of 5% or more of our share capital.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. MAJOR SHAREHOLDERS The following table sets forth the beneficial ownership of our ordinary shares as of March 15, 2025 by all persons who are known to us to be the beneficial owners of 5% or more of our share capital.
As the Gaming Operator was allocated 750 gaming tables by the Macau government, pursuant to the Studio City Casino Agreement, the Gaming Operator is permitted to deduct costs for the allocation of gaming tables for operation at the Studio City Casino which exceed 198 gaming tables provided such costs have been approved by the Company’s related party transactions policy.
As the Gaming Operator was allocated 750 gaming tables by the Macau government, pursuant to the Studio City Casino Agreement, the Gaming Operator is permitted to deduct costs for the utilization of gaming tables for operation at the Studio City Casino which exceed 198 gaming tables provided such costs have been approved by the Company’s related party transactions policy.
When electing to exchange, a Participant 122 Table of Contents must deliver an exchange notice to MSC Cotai, which notice must be delivered at least five business days prior to the proposed exchange date; provided, that settlement may not occur later than 90 days from the notice date.
When electing to exchange, a Participant 119 Table of Contents must deliver an exchange notice to MSC Cotai, which notice must be delivered at least five business days prior to the proposed exchange date; provided, that settlement may not occur later than 90 days from the notice date.
See “— Participation Agreement.” • The Participation Agreement provides that New Cotai is entitled to exchange all or a portion of its Participation Interest for a number of Class A ordinary shares subject to adjustments, exceptions 121 Table of Contents and conditions as set out in the Participation Agreement.
See “— Participation Agreement.” • The Participation Agreement provides that New Cotai is entitled to exchange all or a portion of its Participation Interest for a number of Class A ordinary shares subject to adjustments, exceptions 118 Table of Contents and conditions as set out in the Participation Agreement.
The Studio City Casino Agreement set forth the terms and conditions for the operation of Studio City Casino by the Gaming Operator and the obligations of Studio City Entertainment in respect thereof. 124 Table of Contents Under the Studio City Casino Agreement, the Gaming Operator manages the day-to-day operations of the Studio City Casino, provides the necessary security and develops and implements all systems and controls necessary for Studio City Casino.
The Studio City Casino Agreement set forth the terms and conditions for the operation of Studio City Casino by the Gaming Operator and the obligations of Studio City Entertainment in respect thereof. 121 Table of Contents Under the Studio City Casino Agreement, the Gaming Operator manages the day-to-day operations of the Studio City Casino, provides the necessary security and develops and implements all systems and controls necessary for Studio City Casino.
RELATED PARTY TRANSACTIONS For a discussion of significant related party transactions we entered into during the years ended December 31, 2023, 2022 and 2021, see note 19 to the consolidated financial statements included elsewhere in this annual report.
RELATED PARTY TRANSACTIONS For a discussion of significant related party transactions we entered into during the years ended December 31, 2024, 2023 and 2022, see note 19 to the consolidated financial statements included elsewhere in this annual report.
The Work Agreements cover: (1) services related to the sale and purchase of certain property, plant and equipment and inventory and supplies; (2) corporate services; (3) certain pay-as-used charges; (4) operational and property sharing services; (5) limousine transportation services provided by the Master Service Providers; (6) aviation services; (7) collection and payment services; and (8) limousine transportation services provided by the Studio City Entities.
The Work Agreements cover: (1) services related to the sale and purchase of certain property, plant and equipment and inventory and supplies; (2) corporate services; (3) certain 123 Table of Contents pay-as-used charges; (4) operational and property sharing services; (5) limousine transportation services provided by the Master Service Providers; (6) aviation services; (7) collection and payment services; and (8) limousine transportation services provided by the Studio City Entities.
(3) Represents 72,511,760 Class B ordinary shares, constituting 100.0% of the outstanding Class B ordinary shares and, as of January 30, 2024, 31,149,140 ADS (representing 124,596,560 Class A ordinary shares), constituting 16.2% of the outstanding Class A ordinary shares, directly held by New Cotai, LLC. Subject to the terms of the exchange arrangements described in “Item 7.
(3) Represents 72,511,760 Class B ordinary shares, constituting 100.0% of the outstanding Class B ordinary shares and, as of December 31, 2024, 31,149,140 ADS (representing 124,596,560 Class A ordinary shares), constituting 16.2% of the outstanding Class A ordinary shares, directly held by New Cotai, LLC. Subject to the terms of the exchange arrangements described in “Item 7.
Corporate services are charged at pre-negotiated rates, subject to a base fee and cap. Senior management service fees and staff costs on 126 Table of Contents operational services are allocated to us based on a percentage of efforts on the services provided to us. Other costs in relation to shared office equipment are allocated based on percentages of usage.
Corporate services are charged at pre-negotiated rates, subject to a base fee and cap. Senior management service fees and staff costs on operational services are allocated to us based on a percentage of efforts on the services provided to us. Other costs in relation to shared office equipment are allocated based on percentages of usage.
Each type of service to be provided is to be set out in a separate Work Agreement between the relevant Studio City Entities and the Master Service Providers. As required by the parties, additional Work Agreements (conforming to the pre-agreed format) may be entered into.
Each type of service to be provided is to be set out in a separate Work Agreement between the relevant Studio City Entities and the Master Service Providers. As required by the parties, additional Work Agreements 122 Table of Contents (conforming to the pre-agreed format) may be entered into.
Information regarding beneficial ownership is based on the information contained in the Schedule 13G/A filed by Silver Point Capital L.P. with the SEC on February 14, 2024.
Information regarding beneficial ownership is based on the information contained in the Schedule 13G/A filed by Silver Point Capital L.P. with the SEC on November 14, 2024.
Silver Point Capital, L.P. or its wholly owned subsidiaries are the 120 Table of Contents investment manager of the Silver Point Funds and Silver Point Capital Management, LLC is the general partner of Silver Point Capital Fund, L.P. The address of the principal business office of Silver Point Capital, L.P. is Two Greenwich Plaza, Greenwich, Connecticut 06830.
Silver Point Capital, L.P. or its wholly 117 Table of Contents owned subsidiaries are the investment manager of the Silver Point Funds and Silver Point Capital Management, LLC is the general partner of Silver Point Capital, L.P. The address of the principal business office of Silver Point Capital, L.P. is Two Greenwich Plaza, Greenwich, Connecticut 06830.
Name Number of Class A ordinary shares beneficially owned Number of Class B ordinary shares beneficially owned Percentage Voting Power (1) Melco International (2) 463,095,592 — 54.94 % New Cotai, LLC (3) 124,596,560 72,511,760 23.39 % The Silver Point Funds (4) 114,569,116 — 13.59 % (1) Beneficial ownership is determined in accordance with Rule 13d-3 under the Exchange Act, and includes voting or investment power with respect to the securities.
Name Number of Class A ordinary shares beneficially owned Number of Class B ordinary shares beneficially owned Percentage Voting Power (1) Melco International (2) 463,095,592 — 54.94 % New Cotai, LLC (3) 124,596,560 72,511,760 23.39 % The Silver Point Funds (4) 114,757,656 — 13.62 % (1) Beneficial ownership is determined in accordance with Rule 13d-3 under the Exchange Act, and includes voting or investment power with respect to the securities.
As of December 31, 2023, a total of 842,864,460 Class A ordinary shares and Class B ordinary shares were outstanding, of which 368,577,580 Class A ordinary shares were registered in the name of a nominee of Deutsche Bank Trust Company Americas, the depositary under the deposit agreement.
As of December 31, 2024, a total of 842,864,460 Class A ordinary shares and Class B ordinary shares were outstanding, of which 368,577,180 Class A ordinary shares were registered in the name of a nominee of Deutsche Bank Trust Company Americas, the depositary under the deposit agreement.
If the Master Services Agreement is terminated, all Work Agreements shall automatically terminate. 125 Table of Contents In case of any breach by either party under the “provision of services” and “standard of care; quality” clauses under the Master Services Agreement, the exclusive remedy of the non-breaching party, subject to indemnification for third-party claims and certain limitations on liabilities regarding consequential and other damages as well as caps on a party’s liability equal to the fees paid or charged under the relevant Work Agreement, is for the breaching party to (a) perform or re-perform the relevant services if reasonably determined by the non-breaching party that the performance of the relevant services is commercially practicable and/or (b) refund any fees paid if reasonably determined by the non-breaching parties that performance or re-performance is not commercially practicable or would not be sufficient compensation for the breach.
In case of any breach by either party under the “provision of services” and “standard of care; quality” clauses under the Master Services Agreement, the exclusive remedy of the non-breaching party, subject to indemnification for third-party claims and certain limitations on liabilities regarding consequential and other damages as well as caps on a party’s liability equal to the fees paid or charged under the relevant Work Agreement, is for the breaching party to (a) perform or re-perform the relevant services if reasonably determined by the non-breaching party that the performance of the relevant services is commercially practicable and/or (b) refund any fees paid if reasonably determined by the non-breaching parties that performance or re-performance is not commercially practicable or would not be sufficient compensation for the breach.
We receive the residual gross gaming revenues and recognize these amounts as revenue from casino contract. See “— Studio City Casino Agreement” for details of the terms of the Studio City Casino Agreement. In 2023, 2022 and 2021, revenue from casino contract were US$155.5 million, negative US$56.7 million and negative US$1.5 million, respectively.
We receive the residual gross gaming revenues and recognize these amounts as revenue from casino contract. See “— Studio City Casino Agreement” for details of the terms of the Studio City Casino Agreement. In 2024, 2023 and 2022, revenue from casino contract were US$259.8 million, US$155.5 million and negative US$56.7 million, respectively.
Total gaming taxes and the costs incurred in connection with the on-going operation of Studio City Casino deducted from gross gaming revenues were US$756.9 million, US$227.9 million and US$382.3 million in 2023, 2022 and 2021, respectively.
Total gaming taxes and the costs incurred in connection with the on-going operation of Studio City Casino deducted from gross gaming revenues were US$1.06 billion, US$756.9 million and US$227.9 million in 2024, 2023 and 2022, respectively.
(4) Represents 28,642,279 ADSs (representing 114,569,116 Class A ordinary shares), constituting 14.9% of the outstanding Class A ordinary shares, held by Silver Point Capital Fund, L.P., Silver Point Capital Offshore Master Fund, L.P., Silver Point Distressed Opportunities Fund, L.P., Silver Point Distressed Opportunities Offshore Master Fund, L.P., Silver Point Distressed Opportunity Institutional Partners Master Fund (Offshore), L.P. and Silver Point Distressed Opportunity Institutional Partners, L.P., or the Silver Point Funds, as of December 31, 2023.
(4) Represents 400 Class A ordinary shares and 28,689,314 ADSs (representing 114,757,256 Class A ordinary shares), constituting 14.9% of the outstanding Class A ordinary shares, held by Silver Point Capital Fund, L.P., Silver Point Capital Offshore Master Fund, L.P., Silver Point Distressed Opportunities Fund, L.P., Silver Point Distressed Opportunities Offshore Master Fund, L.P., Silver Point Distressed Opportunity Institutional Partners Master Fund (Offshore), L.P. and Silver Point Distressed Opportunity Institutional Partners, L.P., or the Silver Point Funds, as of September 30, 2024.
Removed
These arrangements were further amended on June 23, 2022.
Added
In addition, these costs include the costs for utilization of electronic gaming machines for operation at Studio City Casino above 552 electronic gaming machines which was the number of electronic gaming machines initially allocated by the Gaming Operator to Studio City Casino as a result of the Macau government’s allocation of 2,100 electronic gaming machines to the Gaming Operator under the Concession, provided such costs have also been approved by the Company’s related party transactions policy.
Added
Studio City Entertainment receives the residual gross gaming revenues and recognizes these amounts as our revenue from the Studio City Casino Agreement.
Added
In July 2024, pursuant to a request we made under the Studio City Casino Agreement, the Gaming Operator allocated an additional 50 electronic gaming machines for operation at Studio City Casino, which allocation may be terminated upon 30 days’ written notice by either Studio City Entertainment or the Gaming Operator.
Added
In addition, pursuant to requests made under the Studio City Casino Agreement from time to time, the Gaming Operator currently allocates 61 mass gaming tables for operation at Studio City Casino, which such allocation may also be terminated upon 30 days’ written notice by either Studio City Entertainment or the Gaming Operator.
Added
If the Master Services Agreement is terminated, all Work Agreements shall automatically terminate.

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