Travellers International Hotel Group Inc, owner and operator of Resorts World Manila casino venue, reported a net profit of PHP1.16 billion (US$26.6 million) for the second quarter of 2014, down by 11.5 percent year-on-year, the company said on Friday.
Although direct costs for the period decreased by more than 23 percent, to PHP2.3 billion, revenue declined by 18 percent, to PHP7.3 billion from PHP8.9 billion a year earlier.
Gaming revenue for the three months ended June 30 was PHP6.37 billion, down from PHP8.01 billion a year before.
Travellers International is a joint venture between Philippines-based Alliance Global Group Inc and Genting Hong Kong Ltd, a subsidiary of Malaysia’s Genting Bhd. Its Resorts World Manila casino property, located at Newport City near Manila International Airport, opened in 2009.
The company said net profit for the first half of 2014 increased by 25 percent to PHP2.9 billion. Total gross revenue for the period was however down by 20 percent in year-on-year terms, to PHP15.3 billion.
Earnings before interest, taxation, depreciation and amortisation (EBITDA) reached PHP4.7 billion for the first six months of 2014, 4.0 percent higher compared to PHP4.5 billion reported in the same period last year.
Travellers International said hotel occupancy at Resorts World Manila for the first half of the year remained solid with all three hotels, namely Maxims, Remington and Marriott registering average occupancy rates of about 90 percent. Total room count for the three hotels is at 1,226.
The firm said total capital expenditure for the year is budgeted to reach PHP7.0 billion as it accelerates the execution of its phase 2 and 3 plans for Resorts World Manila.
Phase 2 involves the expansion of the existing Marriott Hotel Manila with the construction of Marriott Grand Ballroom, as well as additional rooms through the Marriott West Wing. The Marriott Grand Ballroom is scheduled for commercial operations in March 2015, while the Marriott West Wing will be operational by the end of 2015.
Phase 3 consists of three hotels – the Hilton Manila Hotel and the Sheraton Manila Hotel, as well as a new wing for the Maxims Hotel. It will also include a new gaming area, additional retail space and six basement-parking decks. The entire Phase 3 will be completed “no later” than the last quarter of 2017, Travellers International said.
Phases 2 and 3 will almost double the total number of hotel rooms to 2,400 rooms.
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Analyst at Union Gaming Securities Asia