GGRAsia – Iao Kun’s VIP chip roll dips 72 pct in August

Iao Kun’s VIP chip roll dips 72 pct in August

Sep 04, 2015 Newsdesk Latest News, Macau, Top of the deck

VIP gambling room investor Iao Kun Group Holding Co Ltd announced that its unaudited rolling chip turnover in Macau for August decreased by 72 percent in year-on-year terms, to US$440 million. The win rate for the month of August 2015 was 4.13 percent, the company said in a statement on Wednesday.

Iao Kun’s business partners promote five high-roller facilities in Macau casinos. The firm has also started trial operations at Crown Perth Casino and at Crown Melbourne Casino, in Australia, two venues operated by Crown Resorts Ltd.

The Macau government on Monday announced that citywide in August, gross gaming revenue (GGR) for Macau had fallen by 35.5 percent from the prior-year period. It was the 15th straight month of GGR retreat measured year-on-year.

Market-wide in Macau, August rolling chip turnover was down by 54 percent, excluding ‘direct VIP’ business, according to unofficial industry returns compiled by Deutsche Bank Securities Inc. Direct VIP is a reference to VIP players directly managed by the house, rather than brought in by junkets.

“The August results served as a setback to the ‘less bad’ thesis as continued deterioration in VIP volume trends and limited positives within the mass segment characterised the month,” analysts Carlo Santarelli and Danny Valoy said in a note on Thursday.

For the first eight months of 2015, Iao Kun’s unaudited rolling chip turnover fell 62 percent compared to the year-earlier period to US$4.80 billion. The figure represented a monthly average of US$600 million for the period between January and August, compared to an average of US$1.57 billion per month for the first eight months of 2014.

Nasdaq-listed Iao Kun posted a net loss of US$23.8 million for the second quarter of 2015, compared to a net loss of US$56.7 million for the same period of 2014. Revenue for the period fell by 56 percent year-on-year to US$21.9 million.

The company said it experienced a “decreasing trend of VIP baccarat, consistent with the overall decline of gaming revenue in Macau”.

Iao Kun’s financial controller, Derrick Wong, told Bloomberg News that the firm’s VIP rooms have lost 20 percent of their clients in the three months to August as “some don’t have the capital to come and play”. “They now need to catch their breathe and recuperate,” he added.