Cambodia casino operator NagaCorp Ltd said gross gaming revenue (GGR) at its Phnom Penh gaming resort NagaWorld (pictured) rose by 47 percent year-on-year to US$399.9 million in the nine months to September 30. The firm issued on Friday to the Hong Kong Stock Exchange its unaudited results for the period.
The company recorded GGR of US$144.5 million in the third quarter, up by 57.8 percent from the prior-year period.
In the VIP segment, NagaWorld’s rolling chip turnover for the nine months to September 30 reportedly jumped 46 percent from a year earlier to about US$5.9 billion. In the mass market, table “buy-ins” rose 16 percent year-on-year to nearly US$404.5 million. Slot machine “buy-in” was up 11 percent year-on-year in the first nine months of 2015, to US$986.1 million, the company said.
Revenue from VIP gaming increased by 52 percent year-on-year to US$193.4 million in the nine-month period, the firm added. Revenue from the mass-market segment rose by 43 percent year-on-year to US$206.5 million, compared to US$144.4 million a year earlier.
“As we had expected, all three primary gaming segments continued to post notable growth with trends generally accelerating in 3Q15 relative to 1H15,” Union Gaming Securities Asia Ltd said in a note on Friday.
“Without exception, Naga has been the one Asian gaming story that continues to generate strong earnings growth while many other regional gaming markets are mired in decline or limited growth,” analyst Grant Govertsen said.
NagaCorp said in its interim report issued last month that the continued downturn in the gaming sector in Macau “offers opportunities” for the company “to further penetrate the regional and Chinese gaming market”.
In Friday’s note, Union Gaming said: “The bulk of Naga’s growth story is driven by strength in Southeast Asia/Indochina in general, by economic trends in Phnom Penh in particular (lots of FDI, growing expat community), and by various in-house initiatives like allowing players to exchange cash for chips at gaming tables rather than only at the cage.”
The Khmer Times newspaper reported on Thursday that the Cambodian government has granted 10 new casino licenses in the third quarter of this year, raising the number of casinos in the country to 75.
The newspaper quoted Ros Phearun, deputy director general of the financial industry department at the Ministry of Economy and Finance, saying that most of the new casinos are located in the southwest province of Sihanoukville.
Mr Phearun said most of the new casino operators were interested in online gambling – the government of Cambodia requires online betting to take place within a casino. The official added that Chinese investors own most of the new casinos.
Mr Phearun additionally said the new casinos would be able to survive in Sihanoukville because most of the customers are online gamblers. “That’s why the casino industry is rising [in Sihanoukville],” he told the Khmer Times.
In separate media reports, Chea Serey, director general of the National Bank of Cambodia, said the country’s casino industry generates approximately US$2 billion in revenue a year.
The central bank official added that the revenue figure took into consideration not only income generated at gambling tables, but also other businesses across the tourism sector.
Cambodia only allows foreigners to gamble in casinos operating in the country. Data from the Ministry of Economy and Finance show that the government collected tax revenue of more than US$25 million from the casino industry in 2014 and about US$22 million in the first half of 2015, local media reported.
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"If the [Macau casino] concessions are put up for bid, there will also be a lot of giant Chinese companies, some having nothing to do with gaming, which would like to take over these enormously successful casinos”
Professor emeritus at Whittier Law School in California, in the United States, and a visiting professor at University of Macau