GGRAsia – NagaCorp delays Naga 3 completion by 4 years, to 2029

NagaCorp delays Naga 3 completion by 4 years, to 2029

Jun 05, 2023 Newsdesk Latest News, Rest of Asia, Top of the deck

Casino developer and operator NagaCorp Ltd says construction of Naga 3, an addition to the NagaWorld gaming complex in Cambodia’s capital Phnom Penh, has been pushed back by four years, as the firm is “considering options” regarding completion of the project.

In a filing on Sunday to the Hong Kong Stock Exchange, Nagacorp said it was “carefully and seriously considering options” regarding the development of Naga 3, “matching revenue generation with capex expenditure”. Such options include the possibility of resizing the Naga 3 project, it said.

The decision was due to “the external geopolitical macroeconomic environment and the stiff global inflationary pressures,” it added.

The company said one of its units and the project contractor signed a supplemental agreement on Saturday “to update the completion date of the design and build agreement to a date on or before 30 September 2029, subject to other further adjustments.”

The date for completion of the design and build agreement was originally set for “on or before 30 September 2025”.

In 2019 – prior to casino-sector trading worldwide being severely disrupted by the Covid-19 pandemic – Naga 3 was being described as a US$3.5-billion scheme, with half the funding to come from the founder and chief executive, Chen Lip Keong.

In its latest annual report, published in March, NagaCorp mentioned that once the latest phase is completed, “it is expected that the combined complex of NagaWorld (Naga 1, Naga 2 and Naga 3) will have approximately 5,000 hotel rooms, 1,300 gaming tables and 4,500 electronic gaming machines.”

At the time, the company said piling work for Naga 3 was at “96 percent completion”. Work on the main building at Naga 3 was to start in mid-2023, it stated. The firm’s spending on the scheme slowed in 2022, relative to 2021.

Hong Kong-listed NagaCorp has an exclusive licence to run casinos in Phnom Penh and its surroundings. It started operations with the NagaWorld property, now referred to as Naga 1, which opened in December 2006. That property now links to Naga 2, an expansion that opened in November 2017.

Naga 1 and Naga 2 combined are now described as the NagaWorld Complex (pictured), and are connected via an underground shopping mall known as NagaCity Walk.

In April, NagaCorp reported earnings before interest, taxation, depreciation, and amortisation (EBITDA) of US$59.0 million in the three months to March 31. That was down 3.3 percent as compared to the prior-year period “due to an increase in staff cost and luck factor,” it stated.