GGRAsia – Only one junket currently operating in Saipan: regulator

Only one junket currently operating in Saipan: regulator

Aug 30, 2019 Newsdesk Latest News, Top of the deck, World

Just one of the five licensed junkets in Saipan is currently taking gamblers to the main island of the Commonwealth of the Northern Mariana Islands, said Saipan’s casino regulator on Wednesday.

Local newspaper Marianas Variety quotes Edward Deleon Guerrero, executive director of the Commonwealth Casino Commission on Saipan, as saying only Jang Du Young’s Big Bang Entertainment LLC has been “delivering” so far on its commitment to Imperial Pacific International (CNMI) LLC, a unit of Hong Kong-listed gaming investor Imperial Pacific International Holdings Ltd.

Imperial Pacific has the right to an exclusive casino licence on the Pacific island of Saipan.

Mr Guerrero said most of Big Bang’s VIP casino patrons are from South Korea and Japan. In a meeting on Wednesday the regulator extended Big Bang’s licence for two more years. The licence was due to expire on August 31.

In September last year, the gaming regulator issued licences to four other junket operators: Jiming Dong’s High Tides (CNMI) LLC; Hongyi Ma’s Stellar Paradise CNMI LLC; Hong Zhang’s Bula Mula LLC; and Ni “Lily” Ren’s Hengqin Guiji LLC.

On Wednesday, Mr Guerrero said these junkets – which were expected to engage Chinese customers – had so far been “inactive”.

The regulator is currently waiting for letters of intent from five new junket operators that have expressed interest in applying for a licence in Saipan, he added.

According to the Marianas Variety, Imperial Pacific International (CNMI) chief executive Mark Brown told the gaming regulator that his firm’s business was “very slow and junkets at the moment don’t want to come” to the Saipan casino resort, which is yet to be completed.

Completion of the casino resort complex (pictured) has been postponed time and again as the developer sought money to finish building it.

The Hong Kong-listed company announced last month that its controlling shareholder had agreed to sell about 9.79 percent of the company, and then lend the proceeds to the company for helping build the casino resort on Saipan. The company omitted to say how much money the sale would raise.

In May, the Saipan unit asked the casino regulator to put back the deadline for completion of a portion of the resort to August 21, 2022 from February 28, 2021.

Wider interim loss

On Thursday, Hong Kong-listed Imperial Pacific posted a loss of nearly HKD1.88 billion (US$17.7 million) for the first half of 2019. That compares with a profit of approximately HKD79.0 million in the prior-year period.

Adjusted loss before interest, taxation, depreciation and amortisation was nearly HKD1.42 billion in the six months to June 30. That compares to adjusted earnings before interest, taxation, depreciation and amortisation of almost HKD450.5 million a year earlier.

Revenue for the period fell by 82.0 percent year-on-year to HKD339.4 million, with the operator blaming “adverse market conditions and tightening marker credits”.

VIP table games rolling – accounting for most of Imperial Pacific’s casino business – declined significantly in the first half of 2019. Such rolling amounted to HKD8.3 billion, compared to HKD100.3 billion a year earlier.

VIP gross gaming revenue for the latest reporting period was HKD254.7 million, down 87.5 percent year-on-year.

The firm noted in Thursday’s filing that gross trade receivables decreased to HKD9.17 billion by June 30, after it wrote off trade receivables of HKD6 billion from VIP gaming operations.

Gross trade receivables are typically associated in the casino industry with money owed by VIP gamblers for losses they incurred while playing on credit.

The provision for impairment of trade receivables due from the group’s 10 largest debtors amounted to HKD2.48 billion as of June 30, said Imperial Pacific.

The filing added that – as of June 30 – “approximately US$828 million” had been invested by Imperial Pacific in “design, consulting, engineering, construction material and labour” for its Saipan property.