The City of Dreams (CoD) Mediterranean casino resort (pictured) in the Republic of Cyprus has made 130 employees redundant, and opted not to extend the engagement of 51 probationary staff, the property’s promoter Melco Resorts & Entertainment Ltd has confirmed to GGRAsia.
The property had a formal launch in July, with what the company said was the largest casino in Europe, hosting 100 tables and 1,000 slot machines. The complex, in the coastal city of Limassol, features 500 hotel rooms and suites.
“Due to the unforeseen and ongoing conflict in Israel, the company is facing significant challenges that are greatly impacting our business operations,” stated a press release on behalf of the property carrying Monday’s date, in a reference to conflict between Israel and the Palestinian group Hamas that escalated sharply in October.
News of the reduction in workforce at City of Dreams Mediterranean had earlier been reported by the Cyprus Mail news outlet. It said the steps had taken place between Friday and Monday.
The media outlet cited a spokesperson for a body called PEO, the Pancyprian Federation of Labour, an umbrella organisation for Cyprus labour unions, as saying there was a “climate of chaos at the casino”.
It was not clear from the report whether the organisation represented any of the workers there, which were said by the Cyprus Mail to number 2,000 in total. It had previously been reported that in July, unionists had demonstrated against the resort management declining to allow unionisation on the premises.
At the time of Melco Resorts’ third-quarter earnings, issued on November 6, the chairman and chief executive, Lawrence Ho Yau Lung, had implied that customers from the Middle East had been an important market segment for the new property to pursue.
“After a successful opening, City of Dreams Mediterranean has been impacted by the conflict” involving Israel, remarked Mr Ho in his comments regarding events following the third quarter. “Our teams are working on realigning our marketing strategy.”
Monday’s statement noted: “The integrated resort has seen a steep drop in hotel occupancy and substantial reductions in international casino visitation, forcing the company to make difficult decisions in adjustments to its cost structure to ensure its long-term success.”
It added: “We deeply regret the adverse effects this will have on the 130 colleagues that were made redundant and 51 colleagues on probation that were not extended. We are committed to providing them with support during this transitional period.”
The announcement said redundancies were on a “last in, first out” basis, and “in compliance” with relevant Cyprus law.
“Beyond the legally-mandated obligations, the company will offer impacted colleagues additional ex-gratia packages which are beyond the legal minimum and above industry practices,” said the statement.
It added: “The company is making every effort to help impacted colleagues find alternative employment opportunities with, to date, no fewer than 18 local companies and nine international companies. Further after-care efforts include helping with colleagues’ CVs, interview skills, and other support as needed during this transition.”
City of Dreams Mediterranean is run by Melco Cyprus, a venture between Melco Resorts and Cyprus-based conglomerate Cyprus Phassouri (Zakaki) Ltd. The partnership has a 30-year exclusive licence for the jurisdiction.
Melco Cyprus also operates three satellite casinos in Cyprus in conjunction with City of Dreams Mediterranean, collectively called the “Cyprus Casinos”.
Total operating revenues at the Cyprus Casinos for the quarter ended September 30 were US$53.4 million, compared with US$24.8 million a year ago. Cyprus Casinos generated adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) of US$7.2 million in the third quarter of 2023, up 7.5 percent year-on-year, and a 4.3-percent increase sequentially.
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