GGRAsia – Travellers Int 2023 capex on Newport to hit US$71mln

Travellers Int 2023 capex on Newport to hit US$71mln

Jun 15, 2023 Newsdesk Latest News, Philippines, Top of the deck

Philippines-based gaming operator Travellers International Hotel Group Inc’s capital expenditure (capex) for 2023 is to reach PHP4 billion (US$71.3 million), mainly to support its ongoing expansion projects at the Newport World Resorts complex (pictured), in the capital Manila.

The information was disclosed by local conglomerate Alliance Global Group Inc in a filing on Thursday to the Philippine Stock Exchange.

Alliance Global has a 60-percent stake in Travellers International, according to its latest quarterly report. The firm said last month it had agreed to acquire the remaining shares in the company from the now-defunct Genting Hong Kong Ltd.

In its Thursday filing, Alliance Global stated that Travellers International was “allocating PHP4 billion mainly for its ongoing expansion projects at the Newport World Resorts complex”.

It added that Travellers International aimed “to sustain the strong growth in its gross gaming revenues [GGR], which hit record levels in 2022, and the recovery of its non-gaming revenues alongside the resurgence in staycations and MICE [meetings, incentives, conferences and exhibitions] activities.”

Alliance Global’s chief executive, Kevin Tan, said on Thursday that the group was looking to expand its casino business beyond Manila.

“We are actively looking at some of the key tourism hubs all over the Philippines as potential expansion sites,” he said during the company’s annual meeting, according to Bloomberg.

The media outlet also reported – citing Mr Tan – that Travellers International wants to increase the share of premium mass-market patrons to half of the GGR it generates at Newport World Resorts. The company also plans to expand its VIP junket operations, the report added.

Travellers International posted a full-year profit of nearly PHP1.06 billion in 2022, compared to a loss of just under PHP568.9 million in the previous year, according to information published in April.

The firm’s first-quarter 2023 overall revenues rose 62.9 percent year-on-year, to PHP7.90 billion. First-quarter GGR increased by 36.2 percent during the period, to just above PHP8.89 billion, said a filing by Alliance Global in May.

Newport World Resorts chief operating officer, Hakan Dagtas, told GGRAsia in an interview published last month that a ‘grand club’ concept was under development on the first floor of the gaming area at the property’s Grand Wing. In tandem, Newport World Resorts was launching a whisky and cigar bar, he said at the time.

A new building is under construction at the resort, but management is still deciding on its final layout, according to Mr Dagtas. It might include office and residential space. Construction is expected to take two more years.

Management at Newport World Resorts is also working to link the different buildings that make up the resort, via air-conditioned pedestrian bridges. Two bridges have been completed. The project is to be finalised by 2025, in association with the new building.

In its Thursday filing, Alliance Global said the overall group was “allocating PHP70 billion for capital expenditure this year, an increase of 23 percent year-on-year, to sustain the strong growth momentum of its domestic and international operations.”

The conglomerate also has interests in real estate development through property firm Megaworld Corp; spirits manufacturing through Emperador Inc; and fast-food restaurants through Golden Arches Development Corp.

The filing quoted Alliance Global chief executive Kevin Tan as saying the group was “positioned as the biggest player in the country’s tourism sector, considered as the low-hanging fruit for the Philippine economy.”

(Updated at 2.35pm, June 15)