Bloomberry 3Q profit up 31pct on strong Solaire results
Philippines-based Bloomberry Resorts Corp reported net profit of approximately PHP1.86 billion (US$36.2 million) for the three months ended September 30. Profit was up 31.3 percent in year-on-year terms, the firm said on Thursday in a filing to the Philippine Stock Exchange.
The company is the owner and operator of the Solaire Resort and Casino (pictured) in Manila. It also operates the Jeju Sun Hotel and Casino on South Korea’s southern holiday island Jeju. In addition, Bloomberry plans to build a casino resort at Quezon City, north of Metro Manila, with construction scheduled to start next year.
The strong increase in third quarter profit was mainly due to operations at Solaire, where net income increased by 45.9 percent compared to the prior-year period to PHP1.96 billion.
“We continue to grow across all sectors, and hope to see this up trend continue until the end of the year,” company chairman and chief executive Enrique Razon said in comments included in a press release.
“Our top line and bottom lines are positive and, despite some minor hiccups, I am confident that 2017 will be a banner year,” he stated.
For the quarter ended September 30, Bloomberry reported revenues – net of promotional allowances – of PHP9.60 billion, up by 22.3 percent from a year earlier. The company recorded earnings before interest, taxation, depreciation and amortisation (EBITDA) of PHP3.44 billion for the third quarter, an increase of 33.2 percent from the prior-year period.
Bloomberry said the third quarter produced record quarterly mass table drop and electronic gaming machine coin-in for Solaire, with year-on-year growth rates of 22.4 percent and 38.2 percent, respectively.
Gross gaming revenues (GGR) for the group increased by 17.8 percent year-on-year to PHP11.64 billion. Casino GGR accounted for 92.9 percent of Bloomberry’s gross revenues for the three months to September 30.
Bloomberry’s non-gaming revenues in the quarter – including interest income – grew 49.3 percent to PHP890.4 million on year-on-year terms.
Solaire’s VIP volume decreased by 12.7 percent year-on-year but VIP GGR grew by 14.3 percent, to PHP5.38 billion “because of higher hold rate of 2.83 percent compared to last year’s 2.16 percent,” said Bloomberry.
Jeju Sun recorded GGR of PHP151.0 million for the third quarter of 2017, 436.3 percent higher than a year earlier. “The significant increase in GGR was attributed to an improvement in the overall management and operations of Jeju Sun after implementing a major reorganisation in the latter part of 2016,” said the company.
The result led Jeju Sun to report “its first ever positive quarterly EBITDA” since it was acquired by Bloomberry in 2015. The property posted EBITDA of PHP1.5 million in the three months ended September 30 compared to an EBITDA loss of PHP127.7 million in the prior-year period. The property still posted a net loss of PHP106.3 million for the quarter.
“Jeju Sun improved its operations despite a very challenging market competition in Jeju… caused by a significant decline in Chinese visitation,” Bloomberry noted.
According to some investment analysts, the South Korean market for inbound tourism is facing some headwinds due to a political row between that country and China over the siting on South Korean soil of a U.S.-supplied missile system – known as Terminal High Altitude Area Defense (THAAD) – designed to counter North Korea’s ballistic missile programme. The first parts of the system began being deployed in early March.
The number of Chinese visitors to South Korea – an important source of customers for South Korean casinos – fell 49.6 percent year-on-year in the first nine months of 2017, according to data from the Korea Tourism Organization. In September alone, the number of Chinese visitors to South Korea declined by 56.1 percent in year-on-year terms.
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