Maybank Securities has downgraded Solaire operator Bloomberry Resorts Corp from “BUY” to “HOLD” and reduced its earnings forecasts for the company, citing expected challenges to its flagship Entertainment City resort in 2025 on a slump in fly-in VIP players and fewer domestic Chinese mass players.
However, some upside could come from the ongoing ramp of Solaire Resort North, which will enjoy its first full year of operations this year.
In a Wednesday note, Maybank analyst Raffy Mendoza said the bank has reduced its consolidated net revenue forecast for Bloomberry by 2% to Php49.9 billion (US$854 million) in 2025 and by 17% to Php50.1 billion (US$857 million) in 2026, while the Target Price for shares has been slashed by 52% to Php5.00.
“We expect Bloomberry’s prospects to be challenged this year, particularly its Solaire Entertainment City casino,” Mendoza wrote.
“Among the factors considered in our revisions include … the shrinking GGR contribution of casinos located in Entertainment City driven by the slump in fly-in VIP punters and fewer domestic Chinese players for mass tables; gradual ramp-up and costs attached to Solaire Resort North; and increased competition from additional supply and e-gaming.
Mendoza also observed that Bloomberry’s share price has fallen by 42% to Php4.46 since November, with upside potential in the year ahead to be contingent on the full-year operations of Solaire Resort North and management’s plan to launch its e-gaming platform by 3Q25. Such upside value is estimated at around 9%.
Bloomberry most recently reported a 22% year-on-year increase in gross gaming revenues to Php16.3 billion (US$278 million) in 3Q24, mainly due to revenue contributed by Solaire Resort North which came in at Php3.68 billion (US$63 million) in its first full quarter of operations.
However, the challenging business environment at Solaire Resort Entertainment City saw consolidated Adjusted EBITDA fall by 3.4% year-on-year to Php4.06 billion (US$69 million).
RelatedPosts
