GGRAsia – Leisure and Resorts World Corp 2Q profit down 71 pct

Leisure and Resorts World Corp 2Q profit down 71 pct

Aug 15, 2017 Newsdesk Latest News, Philippines, Top of the deck

Philippines-based Leisure and Resorts World Corp – which has several interests in the land-based and online gambling sectors – reported group-wide revenue of PHP2.53 billion (US$49.4 million) for the second quarter, down by 11.5 percent in year-on-year terms.

Consolidated net income stood at PHP89.5 million, a year-on-year decline of 71.3 percent, the firm said in a Monday filing to the Philippine Stock Exchange. Leisure and Resorts World said performance was negatively affected by a decline in revenue from majority-owned subsidiary First Cagayan Leisure and Resorts Corp, and a decrease in electronic bingo revenue.

First Cagayan is the master licensor for online gaming in the Cagayan Freeport and Special Economic Zone, an economic development area in the northeast of the country’s main island. The firm generated net income of PHP15.6 million for the three months ended June 30, compared to PHP218.3 million in year-on-year terms.

“Recent developments significantly affected First Cagayan’s business and operations due to the issuance on September 1, 2016 by [regulator] Philippine Amusement and Gaming Corp (Pagcor) of the ‘Rules and Regulations for Philippine Offshore Gaming Corporations’,” Leisure and Resorts World Corp stated.

It added: “The said Pagcor regulation was adopted to regulate the issuance of licences which provide and participate in offshore gaming services or online games of chance via the Internet.”

Prior to the new rules, most licences issued by the Philippines for overseas-targeted online gambling businesses had originated from the Cagayan Freeport and Special Economic Zone.

First Cagayan generated PHP120.9 million in gross revenues for the second quarter of 2017, representing a 74.6 percent year-on-year decrease. “The decline in revenues is mainly due to the decline in the locators’ revenue in addition to the decrease in the number of operating locators,” the firm stated.

The company said it had a total of 88 licensed locators for the three months ended June 30, compared to 116 a year earlier.

Leisure and Resorts World said subsidiary Prime Investment Korean Inc – engaged in junket operations at the Midas Hotel and Casino in the Philippine capital Manila – reported a 59.8 percent decline in net income in the second quarter of 2017 to PHP2.6 million. The firm stated it was a result of a 20.8 percent year-on-year decrease in net revenue during the period, to PHP75.9 million.

Hotel Enterprises Philippines Inc, a joint venture with another party, and which owns the Midas Hotel and Casino, also recorded a decline in net results. For the second quarter of 2017, Leisure and Resorts World’s share in the net income of Hotel Enterprises Philippines amounted to PHP4.6 million as compared to last year’s quarter share of PHP17.2 million.

Blue Chip Gaming and Leisure – an operator of slot arcades in the Philippines and also a unit of Leisure and Resorts World Corp – reported gross revenue of PHP119.9 million for the second quarter, up from PHP90.0 million a year before. Net income for the period was PHP44.8 million, up by 255.6 percent in year-on-year terms.