GGRAsia – Iao Kun quarterly revenue down on low win rate

Iao Kun quarterly revenue down on low win rate

Aug 28, 2014 Newsdesk Latest News, Macau, Top of the deck

Macau casino junket promoter Iao Kun Group Holding Co Ltd reported a year-on-year 22-percent drop in revenue, to US$49.7 million, for the three months to June 30.

Nasdaq-listed Iao Kun said on Thursday the decrease was due to a win rate of 2.18 percent for the period, below the expected range of 2.7 percent to 3.0 percent.

The firm added that slower revenue growth of VIP baccarat also had a negative impact on its results. Rolling chip turnover – a metric used by casinos to measure the aggregate amount of player bets and overall volume of VIP gaming room business – for the three months ended June 30 was US$4.7 billion, an increase of 5 percent.

Market-wide, gross gaming revenue from VIP baccarat was MOP54.6 billion (US$6.8 billion) for the second quarter of 2014, show data compiled by Macau’s gaming regulator, the Gaming Inspection and Coordination Bureau. That represented a year-on-year drop of 5.8 percent.

Iao Kun posted a net loss of US$56.7 million for the second quarter, compared to a net loss of US$3.0 million in the same period one year earlier. The 2014 result was negatively affected by a change in fair value of contingent consideration related to the acquisition of three VIP rooms it said.

Iao Kun said the application for a dual listing on the Hong Kong stock exchange is still ongoing. It added that the bourse completed an initial three-day review of the company’s application in July, and the application was then accepted for detailed vetting.

Iao Kun meanwhile introduced changes to its dividend policy. The company said it is expected to pay a dividend of US$0.026 per share for the period, a drop from US$0.08 paid one year before.

The junket operator is maintaining its guidance for 2014 rolling chip turnover in its five existing VIP rooms in Macau at US$17 billion to US$19 billion.