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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Thank you for holding, and welcome to the Galaxy Entertainment Group's management update for the fourth quarter and annual results of 2021. Joining us today are Mr. Michael Mecca, GEG Board's Nonexecutive Director; Mr. Robert Drake, Group CFO; Mr. Roland To, Senior Director of Strategic Planning; and Mr. Peter Caveny, Assistant Senior Vice President of Investor Relations. [Operator Instructions]
I would now like to pass to Mr. Drake for a presentation. Mr. Drake, please go ahead. Thank you.
Thank you, operator, and greetings, everyone, and thank you for joining us for the update on GEG's Q4 2021 results. The GEG team joining me here on today's call include Mike Mecca, a member of the GEG Board of Directors; Roland To, Senior Director of Strategic Planning; and Peter Caveny, Assistant Senior Vice President of Investor Relations.
Copies of our media release, stock exchange announcement and PowerPoint presentation are available on our website, which also include our customary disclaimers.
On behalf of our Chairman, Dr. Lui, Francis Lui and the entire GEG family, we greatly appreciate everyone's continued perseverance in battling the COVID-19 pandemic, which unfortunately has touched everyone in one form or another. We are confident that the world, including Greater China, will continue to successfully navigate through this traumatic period where we remain upbeat and positive that brighter days are indeed ahead.
As you know, Macau continued to be impacted by sporadic COVID-19 outbreaks in the fourth quarter of 2021 and the first quarter of 2022, where the Macau Government continued to react incredibly swiftly to minimize public health and safety risk, as they have throughout the entire crisis. We again applaud the Macau Government for its proactive, decisive and effective leadership during the pandemic.
Despite sporadic outbreaks in Greater China over the past 2 years, Macau has demonstrated an ability to bounce back quickly in a choppy market, while at the same time supporting the all-important public policy, which is certainly cause for optimism. Believe it or not, Q4 2021 was another prime example of this where we began the quarter in October with the lowest visitation and GGR since the full reinstatement of IVS in Q3 2020. We then finished the year on a positive note with 2 of the 3 best visitation months of the entire pandemic in November and December, while December's GGR grew 80% over October's.
As we have mentioned many times before, we continue to believe that the Macau market recovery will be gradual, managed and choppy in the near term, where we remain as confident as ever in its medium- and long-term future. To be clear, GEG remains as committed as ever to the health and safety of the community, our team members and our guests as well as the economic and social stability of Macau, where the continued containment of the virus remains the highest priority.
Despite the pandemic, Macau has been very busy on the regulatory front. Macau completed its 45-day public consultation program on revising the Macau Gaming Law, which has not been updated in 20 years, and subsequently released its report in December 2020. This was followed by the submission of the revised Gaming Law to the Macau Legislative Assembly in January 2022 where they reportedly expect to complete the process and pass the law sometime in mid-2022. This is arguably the precursor to the forthcoming concession tendering process.
The key points listed in the consultation paper and the subsequent proposed revised Gaming Law were not a major surprise to those who closely follow Macau where they showed some flexibility. We believe that the suggested proposals, if implemented, would improve the regulatory oversight of the industry, increase the sector's transparency and strategically position the long-term viability of the cornerstone of the Macau economy. We are also waiting for further insights into the revised Gaming Law as well as an update on the concession tendering process, just like everyone else.
Let's move on to our Q4 2021 performance where our effective cost control efforts continue to yield positive results in the choppy revenue environment. On the development front, we also continued to make progress with our enhancement project at our existing properties as well as our game-changing development projects in Cotai Phase 3, which is virtually complete, and move forward with the construction of Cotai Phase 4.
GEG's Q4 2021 EBITDA grew 3% year-on-year and more than doubled quarter-on-quarter to $1 billion. Our normalized EBITDA of $818 million declined 16% year-on-year, but grew 49% quarter-on-quarter. There are some adjustments in our results that we'd like to share with you. Our Q4 2021 results included a onetime expense reversal of $168 million as well as $57 million of good luck, where both benefited EBITDA.
You may recall that we played unlucky in Q3 2021, which reduced EBITDA by $47 million. We also played unlucky in Q4 2020, which reduced EBITDA by $59 million, which is more than offset by a $100 million COVID insurance claim. This may be a little hard for you to follow on the call, so we invite you to refer to the table on Page 5 of our press release at your leisure for the detail. And just for the record, we had a modest reversal of our gaming bad debt reserve in Q4 2021 as we have been accruing for this in the normal course of business and are fully reserved for VIP junket credit.
We mentioned earlier that there was some cause for optimism during a choppy fourth quarter where our mall operations delivered its second-best performance ever, including a record monthly performance in December despite significant disruption during the quarter due to the COVID-19 outbreak. We continue to enhance our mall offering by introducing additional, highly recognizable, world-class brands. This is certainly an important indicator of healthy demand and bodes well for an overall market recovery.
We also continue to work hard at managing our cost structure, and we'll continue to deliver operating leverage, especially as business gradually improves. To that end, our Macau OpEx burn rate has declined by 32% from approximately USD 3.4 million per day under normal operating conditions and was flat quarter-on-quarter in Q4 2021 in the $2.3 million range.
We'd like to pause here yet again and make a very important point on fiscal management, especially during these challenging times. We certainly acknowledge that OpEx burn rate is an important part of the expense equation, but there is certainly more to the overall cost picture than that. Daily cash burn is more indicative of the cost structure as this includes interest expense. We are very fortunate that we are the only concessionaire in Macau that generates net interest income, not interest expense.
In fact, our net interest income in Q4 2021 was approximately USD 250,000 per day. If you deduct the $250,000 per day of net interest income from the $2.3 million per day in OpEx burn, you get approximately $2 million per day in cash burn, excluding CapEx. It's a powerful example of how conservative balance sheet management really pays in challenging periods in general and, in our case, significantly differentiates us from the competition as well as contribute to making prudent decisions, which are under the long-term best interest of the company.
We would like to thank everyone on the GEG team as well as our valued suppliers who continue to support the company in these difficult times by contributing to our cost management programs. Everyone's support has truly been inspiring. We've also contributed millions of dollars to the COVID-19 relief efforts to support the community, as we previously reported.
Before we move on to our development update, we'd also like to report on our annual 2021 results. GEG reported a $4.5 billion improvement in EBITDA from a $1 billion loss in 2020 to a positive $3.5 billion profit in 2021. Normalized EBITDA improved by $4.2 billion from a $1.1 billion loss to a positive $3.1 billion. And finally, NPAS improved by $5.3 billion from a $4 billion loss in 2020 to a positive $1.3 billion profit in 2021.
Let's move on to our development update, beginning in Cotai where we continue to invest in Macau as well as Galaxy's future. We are pleased to report that we have virtually completed the construction of our Cotai Phase 3, including Raffles at Galaxy Macau as well as the Galaxy International Convention Center and Andaz Macau. As we have previously reported, we intend to align the opening of Cotai Phase 3 with the recovery of the Macau market.
We are also proceeding with the construction of Cotai Phase 4, Macau's only next-generation integrated resort, which will complete our ecosystem in Cotai. As you can see, we remain highly confident about the future of Macau as we continue to invest literally billions of dollars into our business. In fact, we invested approximately $2 billion in Cotai Phases 3 and 4 during Q4 and approximately $20 billion to date against our $50 billion project where we are doubling our footprint in Cotai.
Our Cotai development activities, along with our existing property initiatives, also demonstrate our support of Macau during the pandemic by continuing to invest in the economy, providing jobs and supporting local SMEs as well as our long-term commitment to help Macau achieve its vision of becoming a World Centre of Tourism and Leisure.
Next up is Hengqin where we continue to pursue our projects as well as potentially expanding our focus into Mainland China, including the rapidly expanding Greater Bay Area. We continue to believe that the Central Government continues to signal strong, long-term support for Macau, Hengqin and the rest of the GBA.
Let's move on to our balance sheet, which continues to remain strong, liquid and virtually unlevered. Cash and liquid investments decreased from $38.4 billion at the end of September to $33.4 billion at December 31, 2021. Our net cash position declined from $27.8 billion to $27 billion as investing in our development projects, including Cotai Phases 3 and 4, was partially offset by operational inflows, including EBITDA and net interest income.
Total debt declined from $10.6 billion to $6.4 billion, which primarily reflects $6 billion of borrowings associated with our treasury yield enhancement initiative. Our core debt declined slightly to $375 million, which includes 0 debt associated with our Macau operations. Just to be clear, we said 0 debt with our Macau operations.
Moving on to dividends where the Board announced today a special dividend of $0.30 per share payable on April 2022. Our special dividend certainly demonstrates our continued confidence in the Macau market, GEG's future performance and strong balance sheet, especially during these challenging times.
Our next topic is our outlook where we continue to remain optimistic that Macau's gradual and managed recovery will continue despite the recent choppiness, including the outbreak in Hong Kong, and are very confident that Macau will continue to navigate through the pandemic. We are also encouraged that we see strong signs of healthy demand and are very confident that the leisure and tourism sector will bounce back. This includes most recently our performance over the Chinese New Year holiday in early February. Although visitation was less than anticipated due to travel restrictions, gaming revenue was solid and led by premium mass, hotel occupancy was higher and retail was strong, including a record CNY performance.
In the interim, we remain well capitalized in investing in our development initiatives, including our game-changing Cotai Phases 3 and 4, as the fundamentals in Macau and our operating businesses continue to improve. We also remain upbeat and very positive about the long-term prospects for Macau and the Greater Bay Area, where the underlying fundamentals continue to remain incredibly compelling.
In closing, we would also like to extend our sincere appreciation to the Macau Government for their outstanding performance as well as the community which has rallied around under their leadership during the pandemic. We would also like to thank all the GEG team members again who have been extraordinarily supportive of the community and the company during this challenging period.
Operator, that concludes our opening remarks. So back to you to kick off the Q&A session.
[Operator Instructions] And our first question is from D. S. Kim at JPMorgan.
And sorry if I have missed it from the prepared remarks, but how much was our bad debt this quarter?
Our bad debt expense in gaming was 0. In fact, we had a modest reversal. So -- and we are definitely fully approved for all the VIP bad debt that we have. So we're in pretty good shape. We've been conservative all along and have been accruing for this in the normal course.
That's amazing. And if I may have a follow-up, when I look at the hold ratio this quarter, especially at Galaxy Macau, it went up fairly nicely, almost 30%. And was there any impact from the mix, i.e., did we see outsized growth in the premium mass perhaps converted from the previous junket players and boosted hold by any chance? Or was it just normal fluctuation of the luck and the length of stays and whatnot?
Well, it's great to play lucky every once in a while. And I think what we've seen since the continuous clampdown on VIP, and that's highly publicized crackdown on VIP, that -- and especially over the Chinese New Year period, that we've seen a modest migration of -- from the VIP segment to our premium direct segment, JinMen, and into our Mass business as well. So I think you'll see a gradual migration here of play from the VIP segment, which are customers, and coming across to other parts of our business, and we're certainly encouraged by that. It will be interesting to see how that trend continues over time and -- but we're cautiously optimistic.
If I may, final question on the dividend. I know it's subject to the market situation and the Board decision. But shall we read what's announced today as a second half dividend or full year, i.e., I don't want to be too greedy, but just wondering if we can expect similar twice-a-year dividend announcement going forward this year, starting this year? Or it could be more special, more one-off annual recurring? And that's it for me.
Sure. Dividends are certainly an important part of our capital allocation strategy. And as you know, we posted a positive NPAS in the first half. And thankfully, that continued into the second half. So the Board is very cautious when it comes to this part of our allocation strategy and certainly felt comfortable given the long-term prospects for Macau, our future earnings potential driven by Cotai Phases 3 and 4, but they felt pretty comfortable in paying out a profit for at the listco level, which actually also includes our Construction Materials business.
So it's -- I think moving forward, we'll continue to evaluate it on a case-by-case basis. And if we continue on this path, we've paid special dividends in the past, and as Dr. Lui said at the press conference, hopefully, we'll continue to do that in the future.
The next question is from Praveen Choudhary of Morgan Stanley.
A quick question for me. One, on the bad debt, it's clearly a good management that you're seeing reversal. But I just wanted to understand, when junkets closed down and you might have extended some advance to them, unlike other companies who have reported one-off bad debt provisions in this quarter, especially fourth quarter, why are you not seeing some of that one-off? Can you explain a little bit in detail? That's the first question.
The second question is much more numerical. The CapEx on Phase 3 and 4, how much is already spent? How much is remaining? And the timing of the opening of various projects, Phase 3, 3a and 4.
Sure. Let's tackle bad debt first. We're just very conservative when it comes to managing our balance sheet in general. I think when you look at the amount of credit, I think, from everyone, including the VIP, junket guys learned their lessons from prior experiences. And we've been judicious all along about accruing for bad debt. So it's the -- and we don't have that much to begin with. So rather than taking our medicine on one big dose, we decided to do it over time. And fortunately, in Q4, that we had a modest reversal.
And why did we have a reversal? Well, we had some recoveries from our JinMen business, believe it or not. And then on the non-gaming side, there's absolutely no problem with our receivables. So it's the -- so we're -- it's just a consistent operating philosophy, starting with the Chairman and Francis, in how they've managed their balance sheet throughout their entire career.
As far as Cotai Phases 3 and 4, of course, that represents a majority of the CapEx. We do invest in our properties, as you know. So we've invested $2.1 billion in Q4, so that brings the total for Phases 3 and 4 to just under $20 billion, if not $20 billion. The total project cost remains in the $50 billion range, so we have another $30 billion to go. I would say that we invested maybe $7 billion or $8 billion this year in Phases 3 and 4. We can see that ratcheting up a little bit in 2022 maybe to $8 billion to $9 billion range.
And as we said in our opening remarks, Phase 3 is virtually complete, so there's not a lot of spend left to go there. But the majority of the balance of the $30 billion, that it would be allocated to Phase 4. So again, the openings of Phase 3, which includes Raffles and Galaxy International Convention Center and Andaz will be more aligned with the prevailing market conditions. So it's -- and then Phase 4, we just continue moving forward with the construction there and opening that on the back of Phase 3. So I hope that provides some clarity into our allocation [ strategy ].
Bob, that was excellent. And again, congratulations by doing such a great job with the balance sheet and the bad debt side. Maybe one more follow-up question, if you don't mind. This is related to your Mass business. We saw that you have gained a significant market share in Q4. We saw that market share moved from 17% to 20%, roughly speaking. Was there anything particular about this quarter that resulted in so much market share gain in Mass business? Because when we look at your occupancy, hotel occupancy, it wasn't dramatically different from peers.
And then second question is we are still tracking 30%, 40% of normal business. What needs to happen from the travel relaxation perspective for us to get back to pre-COVID level? And what's your crystal-ball expectation of when we can ever achieve that? That's all for me.
Okay. Let's tackle mass first. As you can see, you have to look at our volume figures as well. So although our volume was up quarter-on-quarter, we did play lucky. So -- and we certainly welcome that. And the net benefit of the luck was about $57 million to the bottom line. And we did play unlucky in Q3 and in Q4 2020 -- Q3 of 2021, that is. And the -- so the profile of the customer, we continue to believe that it's a premium mass-led recovery. We definitely saw that over Chinese New Year. For the folks that are really willing to jump through the hoops to come to Macau, the quality of the customer is just very high. And that's validated by our performance in our retail segment where we had -- the month of December was an all-time record from a monthly retail sales standpoint. And the CNY holiday period, it was a record virtually every -- it was a record every day of CNY over 2019. So we're very encouraged by that.
And the sectors that are doing well, of course, are the high-end segments. Even some of the mid-tier brands are bouncing back nicely as well. And of course, that's -- which bodes well for the overall recovery, to your second question, is that I think for the continued -- once -- it's all driven by immigration policy, which is driven by the continued containment of the pandemic in China.
So unfortunately, there's an outbreak in Hong Kong, which hopefully we'll navigate through that sooner rather than later. And they're just taking a very cautious point of view. And we're all about our top priority of being public health and safety and followed by economic and social stability. So I think we're here for the long haul. Fortunately, we have a strong balance sheet to navigate through that, as do a lot of our brothers. Even though there's more leverage in the market, there's certainly liquidity to navigate through the storm.
And we just have a long-term view. And if we didn't, we wouldn't be investing $50 billion in Phases 3 and 4 in Cotai, which is effectively doubling our footprint. So intermediate, we continue to believe that it's going to be a choppy recovery. Hopefully, it's over sooner than later. It's very difficult to predict these things; in fact, you can't. So all we can do is focus on what we're doing here in Macau and keep our nose to the grindstone. And the Chairman and Francis are really leading the charge here.
The next question is from Sharon Chang at Bank of America.
This is Billy and Sharon from Bank of America. So I guess, first of all, congratulations on very just strong set of results. And I just want to follow up some of the remarks that you've mentioned. Regarding Chinese New Year, obviously, retail was very good. But would you mind to share a little bit more color on mass and premium mass and VIP as well? What kind of trends do you find that as interesting and surprising during the Chinese New Years or even after Chinese New Year recently? Have you seen traffic continue to pick up?
Well, the initial period for Chinese New Year, as we said earlier, it was -- first of all, the results were very encouraging across the board. So -- and of course, we believe that the Mass segment, led by premium mass, was the primary driver. On the VIP side, we did actually see some shift essentially from the junkets, which we don't do business with now, to our premium direct business and into our Mass business.
So I think, as I said earlier, that there's been a migration to some play and which caused -- or if you look at our premium direct volume, it was up over 2019. So it's the -- that's a good sign. It was in -- our results in general were above last year, which wasn't a huge bar to overcome. But we did post better results than we did last year. And on the premium side, we saw some -- upper end of the premium segment certainly was strong as were the medium segment to premium direct as well or premium mass.
So I think it was a solid performance across the board. And again, it was validated by the performance of our retail business. Hotel occupancy was pretty solid, and we had some days that we're well into the 90s and happy with our results. We actually thought that after the seventh day that things would kind of tail off, but they kind of stuck around. So we were pleasantly surprised by the tail. And then right now, recently, of course, there's some seasonality, and the business has drifted downwards. But that's what we believe more to seasonality and less to the restriction.
So it's a -- but we're very encouraged by the results. It just signals that there's latent demand for tourism and leisure here in Macau. So we just got to have to navigate through the pandemic and coming out of this. But I think the -- with Cotai Phases 3 and 4, I think the Board feels very comfortable with the financial positioning of the company, very delighted to pay a dividend, just a signal of continued support of the long-term prospects for Macau, our future earnings potential and the strength -- and the financial strength of the company.
That's very helpful. And just one follow-up on that is, if we think about the direct VIP or premium direct, just based on our own estimate, it used to account for, let's say, about 20% of the overall VIP volume. So does that mean going forward, that should be a sustainable volume that we can use as a forecast, kind of rough estimate, like 1/3 of them we can keep through our direct program?
It's an interesting question, Billy. And I think it's -- maybe as a placeholder, we could do that. But I think we need a little more time to see how things really transition out into the future. So again, we're cautiously optimistic about it, but we just want to keep managing our expectations here. So we just need more time to see what type of trend actually transpires from the migration of VIP to our other segments of our business, whether it's premium direct or our Mass business. We just need more time.
Okay. And one last question. I think you also mentioned about Phase 3, the opening probably still depend on the market condition. But let's say, as the current trend sustain and in terms of market condition, we are getting closer to like May last year's, somewhere around there, and without any further border relaxation, just keep it cynical right now, would that be good enough for thinking about pushing the opening maybe in the next few months?
Well, I think we're going to keep our eyes on the market, as everyone else is. And I think, again, we still believe that the recovery is going to be choppy, it's going to be managed and it's going to take some time. Having said that, you can see that in our OpEx burn rate that we've been able to effectively control our costs, and we've been at basically $2.3 million per day through the better part of the year. We see fluctuations throughout the market. We're very, very disciplined on our cost structure. And we want to see strong evidence of the recovery before we start opening incremental new capacity.
But having said that, we could actually move pretty quickly once we see that we have a high degree of confidence that we're cycling out of the pandemic and volumes are increasing, that it wouldn't take long for us to ramp up Raffles. It's another -- it's already part of Galaxy Macau. So we're very conscious about that. And it's not a separate integrated resort where you'd have to really take on a lot of costs in order to just open up your doors. And having -- as far as the GICC and the Andaz is concerned, that's more a convention facility. There's more "casual labor" to run those operations and really fix labor. So that's something that we can manage through.
So it's -- we're really going to do our best to align our -- the openings to the recovery of the market. But we want to see strong evidence of the recovery before we incur incremental costs that we really can't get back. So it's the -- we'll just continue to be very disciplined. And we're quite confident that we're creating operating leverage here, doing more with less and significantly reduced our workforce throughout this period. So we'll emerge as a much stronger operator.
And that makes a lot of sense. And very quickly, one last question regarding back on that. So it seems like it's pretty much complete, right, Phase 3. So like in terms of CapEx, after the $2 billion you spent in the fourth quarter, there's not much left in 2022. Is that right? Like -- and can we consider basically the construction part is almost 100% complete at this point?
Virtually. And then you go into the preopening phases, and so it's -- but no, the lion's share of the capital has been invested. The majority of the balances would be for Phase 4.
Congratulations again.
The next question is from George Choi at Citi.
I have a quick one on licenses. So based on the conversation you have with the Macau Government, what's your view on when the license retendering process could start?
Well, as we commented in our remarks, that we're making a lot of progress on the first part of the process, which is revamping the Gaming Law. Currently, it's in the legislature and they're debating it. And I think they came out today or yesterday saying that their target is to complete the Gaming Law revision process by middle of the year, hopefully before the concessions expire. And then on the back of that, they'll run their tendering process and -- which is signaling a potential extension, and we're still working with the government on what that may actually be. So it's -- we're watching the newspapers. We're having open dialogue with the government, and you'll know when we know.
And another question here from me. On GM Phase 3, very encouraging to know that it's virtually complete. But can we get an update on whether those -- the typical specific approvals from the various government departments, the fire department, the MGTO, how are we on that front? What are the licenses strategy that are still pending?
We're still working on the permitting process. But you can see, if you were here in Macau, George, you would see that the project is virtually complete. Even if you go around the convention center, the roads around the facility, we've even painted the lines. And so we're making a lot of progress. So it's -- are we ready to open today? No. Are we working with the government on the permitting process? Yes. And we're -- we can move very quickly if we see the market coming back, as I said earlier, but it's very difficult to predict that. And -- but when you do that, you take on incremental costs and that we want to see strong evidence of the recovery. That's why Francis is very disciplined about having a lot of confidence that once the recovery starts that we could -- that it's sustainable and that he wants to open up incremental capacity.
That's very helpful. And once again, congrats on these strong results.
Thanks, George.
The next question is from Simon Cheung at Goldman Sachs.
I got a couple of questions. Just in relation to what you mentioned about this strength that you're seeing in the mass market, just wondering who are these customers that you are seeing? Because obviously, we continue to see all these news about cracking down on the blacklist player. Wondering whether you can shed some light on who are these players and whether that's going to be incremental impact from that policy tightening. That's the first one.
And then second one, just back to the bad debt. I think I look at your balance sheet, you have what, HKD 590 million of receivable numbers, I suspect part of which would be related to the construction business. But can you share with us what is your net exposure to junkets as of now?
And then thirdly, on the dividend, the $0.30 DPS basically was broadly in line with your EPS last year, which is 100%. I remember you used to pay 30%. I don't know that $1 billion that you're now paying equivalent to $0.30, how should we think about going forward? Is there any resumption of some sort of payout ratio once you reach certain milestones?
And lastly, I think on -- the last point, on Wynn Resorts, I noticed that at the back of your announcement, your equity stake reduced from 4.8% to 4.5%. I'm wondering what's in there. Have you reduced your exposure or anything?
As far as Wynn, I don't -- we didn't -- our position hasn't changed, but the value of the investment changed, unfortunately, but the amount of shares haven't.
So going back to your first question on what we're seeing in the Mass business, I think in general, we continue to believe it's a premium-led recovery. We are pleasantly surprised that folks outside of Guangdong made the effort to come to Macau, which is a strong signal that there's a demand for what Macau offers in general and what Galaxy has specifically.
And you're right about policy tightening, we're monitoring that very closely. There are new laws going into effect effective March 1 in China that we're conscious of. But it's -- I think what's going to happen is that you're going to have to make this up with smaller numbers, the loss, meaning that it will take more customers who'll make up for a premium customer. I think once that segment of the market bounces back, that it would bode well for the overall market.
As far as our bad debt for -- our net debt -- we are fully accrued for VIP. We are fully accrued for all of our VIP credit, 100%. And we're very -- on our premium direct business, we employ a top-down approach where we apply very conservative advanced formulas against receivable and supplement that from a bottoms-up player-by-player review by our credit committee. And we're more than adequately reserved there. And that's why we had a -- that's why we had some recoveries during the quarter. So in fact, our bad debt reserve for gaming and for non-gaming actually had a modest reversal. So that's not a bad thing. And the -- I hope I answered your question on that.
As far as dividends are concerned, I think we're looking at it a case-by-case basis. We did, as I said earlier, reported a positive NPAS in the first half of the year and then, of course, in the second half of the year as well. And I think just to show support for the shareholders and throughout the pandemic and just being supportive of the company, that I think the Board felt comfortable paying out a dividend based on what we just went through and the -- which attests to the financial strength of the company, what we think our long-term earnings potential is and reaffirming our long-term confidence in Macau to do anything to pay today.
So it's -- we remain very bullish on the prospects for Macau. That's why we're investing in Phases 3 and 4. We think we're well positioned to be a part -- to participate in the concession bidding process when it happens, and we're very excited about the future.
As to your future dividends are concerned, we'll continue to employ the -- what we've always done, is that the Board will evaluate it on a case-by-case basis. And it's difficult to say, well, is it going to be X percent payout ratio or Y percent payout ratio. We take a lot of things into consideration when we evaluate dividends. And I'm sure the Board will continue to do that in the future.
Okay. Okay, sounds good. Congrats on a good set of results again.
Simon, thank you.
There are currently no more questions.
Well, great. We covered a lot of ground here. Thank you for participating in today's call. We look forward to updating you on our first quarter results sometime during the month of May. And stay safe and healthy.
This is the end of GEG's conference call. Thank you for joining us today. You may now disconnect.