GGRAsia – Cambodia GGR recovery to up pace this year: NagaCorp

Cambodia GGR recovery to up pace this year: NagaCorp

Feb 20, 2024 Newsdesk Latest News, Rest of Asia, Top of the deck

Cambodia is likely to receive more visitors from mainland China this year as direct-flight capacity grows, which might aid recovery of the gross gaming revenue (GGR) of that nation’s casino industry in general, and of NagaCorp Ltd in particular, said on Tuesday Mike Ngai, the group’s chief operating officer.

For 2024, the company – which runs the NagaWorld casino complex under a long-life monopoly licence in the Cambodian capital, Phnom Penh – expects “there’s room to continue to grow in all business segments: mass, premium mass, premium VIP, and also junket,” remarked Mr Ngai.

His comments were at a media briefing in Hong Kong, following Monday’s release of the group’s full-year results. They showed its 2023 GGR at only circa 30 percent of 2019 level, i.e., the trading period prior to the Covid-19 pandemic.

“There was a certain structural change in the industry, especially the junket segment… during the Covid time: quite a number of Macau junket operators have ceased operations [at NagaWorld],” said Mr Ngai, noting those Macau junkets “never returned”.

Nonetheless the NagaCorp executive said that what the firm terms its “premium VIP” gaming segment – house-managed VIP play at NagaWorld – had in 2023 recovered to “over 100 percent” of 2019 level.

Currently, the minimum bet for mass-market high-limit play at NagaWorld was around “US$200 to US$300”, Mr Ngai mentioned in response to a question from GGRAsia. This showed, he said, that the group had in some instances been “able to convert the regular mass player into a premium mass player”.

High-limit mass play and the premium VIP segment has also been helped by the return already of some “high-quality” players, a number being business travellers.

NagaCorp’s GGR for full-year 2023 was US$514.8 million, with 65.4 percent of it booked to mass gaming operations. The 2023 GGR reached only 29.9 percent of 2019’s US$1.72-billion. In the latter year, 72.3 percent of NagaCorp’s GGR came via the VIP market.

The group said in Tuesday’s update, it might scale down the cost and size of the Naga 3 extension for NagaWorld, in favour of building up its capital.

In the briefing, the group also gave some commentary on its paused casino resort project at Primorye near Vladivostok in Russia.

In March 2022 NagaCorp said it had suspended work on the scheme “indefinitely”. Days later, Daiwa Capital Markets Hong Kong Ltd, stated in a note that “sanctions led to suspension of the Russia project” – though without referring to Russia’s war with Ukraine – adding that NagaCorp might try to sell it off.

NagaCorp executive deputy chairman and executive director Philip Lee Wai Tuck said at Tuesday’s briefing: “If there are substantial, reasonable offers, we may consider selling it… but as of now, we have not had any serious offers… we can look at.”

The company had at one stage said it was planning to invest about US$350 million to build a casino, hotel and exhibition venue there, and a substantial amount of above-ground work had been completed.