Philippines-based casino operator Bloomberry Resorts Corp posted a consolidated net profit of PHP1.97 billion (US$38.9 million) for the second quarter of 2017, up 46.8 percent from the prior-year period. The improved performance was supported by a “new quarterly record mass table drop and electronic gaming machine (EGM) coin-in,” the company said in a filing on Thursday to the Philippine Stock Exchange.
Bloomberry developed and operates Solaire Resort and Casino (pictured) in Manila, the Philippines capital. The firm also operates the Jeju Sun Hotel and Casino on South Korea’s southern holiday island of Jeju.
Consolidated net revenues for the April to June period jumped 17.6 percent year-on-year, to PHP9.83 billion, the firm said.
Earnings before interest, taxation, depreciation and amortisation (EBITDA) declined by 11.4 percent year-on-year to nearly PHP3.64 billion. The company said the EBITDA decrease was due to higher costs and expenses “brought about by the reversion to the original gaming tax … structure”. Bloomberry said its second quarter EBITDA would have increased 13.8 percent year-on-year if it had applied the same gaming tax structure used during the second quarter of 2016.
The Philippine Amusement and Gaming Corp (Pagcor), the country’s gaming regulator, restored the original gaming tax rate late last year, following a court dispute between Bloomberry and the country’s Bureau of Internal Revenue. In April 2013, the tax bureau had imposed a corporate income tax at a rate of 30 percent on the private sector casino operators, a decision that was overturned by the Supreme Court last year.
In the three months to June 30, group-wide gross gaming revenue (GGR) rose 16.4 percent year-on-year to approximately PHP12.22 billion, with Solaire recording total GGR of PHP12.10 billion.
“We are gratified to see the continuing results of our efforts to level up Solaire’s game. There will be no let-up in these efforts. We are on track, and we will continue to focus on surpassing our previous achievements,” said Enrique Razon, Bloomberry’s chairman and chief executive, in a statement included in a separate press release.
GGR growth
Solaire’s VIP volume grew by 14.5 percent year-on-year, while VIP GGR grew by 8.7 percent, to PHP6.3 billion. “VIP posted its biggest revenue for the quarter after registering a 3.49-percent hold rate, which was significantly higher than the normal hold of 2.85 percent,” said Bloomberry.
Mass table drop and EGM coin-in at Solaire grew by 20.1 percent and 29.4 percent, respectively. “This consistent growth in volume in all segments has been happening for four consecutive quarters,” the firm stated.
Jeju Sun recorded GGR of PHP113.9 million for the second quarter of 2017, 20.9 percent higher than a year earlier. “This was achieved against the backdrop of a huge decline in Chinese travellers to Jeju,” said the company, referring to a diplomatic row between China and South Korea over the latter’s installation of a U.S.-supplied missile system which is reportedly supposed to counter North Korea’s ballistic missile tests.
The number of Chinese visitors to South Korea fell 41 percent year-on-year in the first six months of 2017, according to data from the Korea Tourism Organization.
Bloomberry’s promotional allowances and contra accounts grew by 16.9 percent year-on-year to PHP3.14 billion in the second quarter of 2017. Bloomberry said the increase was “mainly due to higher rebates to junket operators as a result of higher VIP volume, as well as other promotional incentives provided to guests”.
Promotional allowances and contra accounts as a percentage of gaming revenue increased slightly to 25.7 percent in the second quarter, from nearly 25.6 percent in the prior-year period.
Non-gaming revenues in the reporting period grew by 39.7 percent year-on-year, to approximately PHP789.8 million, the company said.
