Okada Manila EBITDA to keep growing: Universal
Japanese gaming company Universal Entertainment Corp says it expects its casino resort operations at Okada Manila (pictured), in the Philippines, to continue growing as the property ramps up. A Philippine subsidiary, Tiger Resort, Leisure and Entertainment Inc, runs Okada Manila.
In a first-quarter earnings filing on Tuesday, Universal Entertainment said the group’s “highest priority” at Okada Manila was to “continue to expand attractions and amenities”.
The company said additional rooms in the Hotel Tower B were due to be open later this year. “This will help support continued growth in the integrated resort business as well as better position the resort to host large group events and foreign tour groups,” said Universal Entertainment.
The group stated that Okada Manila’s adjusted segment earnings before interest, taxation, depreciation and amortisation (EBITDA) margin was “expected to continue to expand during fiscal year 2019 due to fixed cost leverage on increasing sales”.
The Japanese conglomerate posted a net loss of just above JPY4.09 billion (US$37.3 million) for the first three months of 2019, having made a net profit of about JPY181.40 billion in the prior-year period. Such profit for the first quarter 2018 included money from a compensation settlement worth US$2.4 billion paid by casino group Wynn Resorts Ltd to settle a stock redemption dispute.
Universal Entertainment said that its net sales for the three months to March 31 this year rose by 15.8 percent year-on-year to nearly JPY22.64 billion.
The casino-resort business made an operating loss of nearly JPY513 million in the first quarter of 2019 on net sales that rose by 88.5 percent year-on-year, to JPY16.77 billion. Adjusted segment EBITDA in the casino resort business was just above JPY2.84 billion, up from JPY20 million a year earlier.
The growth in sales at Okada Manila was supported by “increasing visitation to the resort and further refinement of the mass market casino marketing programme as well as the addition of a new junket in March 2019,” said Universal Entertainment in Tuesday’s filing.
According to preliminary figures reported last month, Okada Manila’s accumulated gross gaming revenue stood at PHP9.52 billion (US$181.9 million) for the first quarter of 2019, up by 91.0 percent compared with PHP4.98 billion a year earlier.
In Tuesday’s filing, Universal Entertainment said it expected VIP casino revenues at Okada Manila “to continue growing driven by the addition of new junkets, and more demand from existing junkets”.
“Mass market table and gaming machine revenue is expected to continue growing as the property continues to ramp up and new casino marketing initiatives continue to be implemented and improved,” said the company. “Increasing number of hotel rooms, retail outlets and other amenities are expected to drive additional visitation and mass market casino revenues,” it added.
Okada Manila recorded an operating loss of nearly JPY6.21 billion in 2018, according to the parent company.
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