May 19, 2023 Newsdesk Latest News, Philippines, Top of the deck  
Maybank Securities Inc has upped its growth estimates for casino operator Bloomberry Resorts Corp’s earnings for 2023 and 2024, on the back of the firm’s “higher-than-expected” first-quarter performance. “We think Bloomberry still has substantial runway for growth,” said the institution in a Thursday note, mentioning “robust domestic spending patterns for entertainment,” and “manageable competition risk”.
Philippines-listed Bloomberry saw its first-quarter net income increase 334.7 percent year-on-year, to just above PHP2.98 billion (US$53.6 million), on revenue that rose by 78.5 percent, to PHP12.83 billion. The company operates the Solaire Resort and Casino (pictured) in the Metro Manila region.
In Friday’s memo, Maybank Securities said it was raising its estimates by nearly 39 percent for Bloomberry’s 2023 net income, to PHP10.05 billion, from a previous estimate of PHP7.25 billion. It also upped its estimates for the casino firm’s net income in 2024 by 17 percent, to PHP14.83 billion, from a previous PHP12.63-billion forecast.
Maybank Securities also raised its gross gaming revenue (GGR) assumptions for Bloomberry for 2023 and 2024, by 9 percent and 7 percent, to PHP55.51 billion and PHP71.19 billion, respectively. It said it factored in “sustained strength from the [South] Korea VIP base”, and also continuous strength in the operator’s mass and slots performance.
“Our 2023 GGR forecasts for VIP, mass and slots are at 75 percent/100 percent/138 percent of 2019-levels respectively,” wrote analyst Miguel Sevidal.
He added: “Our view is that Bloomberry still has substantial runway for growth, which is anchored primarily on domestic demand and further supported by strong VIP recovery. Downside risks to growth from competition and regulation are limited, in our view.”
The institution also maintained the view that Philippines’ domestic demand is believed to be the main driver for sector-wide mass and slots GGR growth. “Our expectations of strong domestic demand are further supported by the resilience of industry GGR to inflation and the increasing wallet share of casinos,” wrote Mr Sevidal. The “wallet share” referred to is the increase in proportion of local spending on casino gambling activities relative to the overall spending on entertainment and recreation, according to the memo.
Bloomberry’s first-quarter VIP gaming results “surprised to the upside” – due to support from “locally-based Chinese players” and patrons from South Korea, Taiwan and the ASEAN region, added the note.
The institution believed the Korea VIP base should “remain upbeat” on increased flight connectivity between South Korea’s air hub of Incheon and Manila.
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