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NagaCorp profits up as casino packs in punters

Traffic passes the NagaWorld casino in Phnom Penh in 2014.
Traffic passes the NagaWorld casino in Phnom Penh in 2014. Scott Howes

NagaCorp profits up as casino packs in punters

Nagacorp Ltd, the operator of NagaWorld casino in Phnom Penh, saw its net profit climb 24 per cent during the first half of 2016 on “an increase in business volume across all segments of the gaming business,” the Hong Kong-listed company said in a filing yesterday.

Total revenue during the first six months of the year topped $288.5 million, a 10.3 per cent increase compared to the same period a year earlier, while net profit rose to $125.2 million, up 24 per cent year-on-year.

Casino operations accounted for 96 per cent of revenue, while the remainder was earned from its hotel operation, and food and beverage sales – which increased 11 per cent year-on-year during the period as junket operators funnelled more traffic to its hotel.

“The business volume growth is attributable to visitor growth to the property and successful operational efficiencies implemented in 2015 that continued to provide convenience for players at the gaming tables and EGMs [electronic gaming machines],” the company said.

A successful junket program with leaner incentives to operators and agents helped boost revenues in the VIP segment. Rolling chip turnover for the first six months of the year rose 26 per cent compared to the same period a year earlier to $4.5 billion with a win rate of 2.5 per cent, the company said.

In the mass market, public floor table buy-ins increased 17 per cent year-on-year to $305.6 million during the first half of 2016, while EGM bills-in rose 18 per cent year-on-year to $741.8 million. The average win rate was 20.3 per cent, down slightly compared to a year earlier.

NagaCorp attributed growth in its mass-market segment to last year’s implementation of table buy-ins at all public floor tables and installation of a “ticket-in, ticket-out” system on all EGMs. It also credited collaboration with Chinese outbound travel agents and an expansion of service by an unnamed independent airline serving the Chinese market – a reference to Bassaka Airlines, which leases two aircraft from the casino operator.

NagaCity Walk, a duty-free retail shopping centre set to occupy a tunnel connecting NagaWorld to the future Naga 2 mixed entertainment complex, will open this month, the company announced. Chinese state-owned retailer China Duty Free Group has leased about 3,900 square metres of the underground shopping complex.

“NagaCity Walk will enhance the overall retail experience available to patrons and further strengthen NagaWorld’s appeal to both the VIP market and mass market,” NagaCorp said in its filing.

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