Inside Asian Gaming

47 August 2013 | INSIDE ASIAN GAMING REGIONAL BRIEFS in Pokhara closed last month, citing the doubling of the entry fee designed to discourage Nepalis from gambling. The casino had been in operation for five years. More casinos are expected to follow, and tourism officials are concerned about the impact. The casinos say around 70,000 tourists visit the casinos annually. Around 20% of them visit Pokhara. Kedar Sharma, president of the Pokhara chapter of the Nepal Association of Tours and Travel Agents, said the venues are an essential component of foreign visitation. “The government should create an environment for entrepreneurs to do business,” he said. “Most of the Indian and Chinese tourists, who are in Pokhara, visit casinos,” added Tikaram Sapkota, a member of the Nepal Tourism Board. The government has given operators four months to comply with new regulations that require them to register for licensing. The new rules also call for closer monitoring of the properties to prevent Nepalis from getting in. Regular audits of machine games also are planned. “Daily record of people entering the casinos and payout records have been made mandatory. The total number of coins, machines and values of the coins also should be transparent, and the casino- holders are strictly prohibited from providing loans to the gamblers,” said Secretary of Tourism and Aviation Purna Chandra Bhatteri. New start-up costs have been set at 250 million Nepalese rupees for five-star hotels (US$2.6 million) and NPR150 million for four-star hotels. Operators must pay NPR20 million ($210,000) upon receiving their licenses and another NPR500,000 as a registration fee. There are also annual fees—NPR40 million for five-star hotels ($420,000), NPR30 million for four-star—and casinos must begin investing 2% of their profits in “social development” programs. Wynn Macau 2Q Revenue Up 2.6% Wynn Macau reported net revenue in the second quarter of US$930.9 million, a 2.6% increase over the same period last year as renovation work on several hundred hotel rooms reduced available room nights by about 5% compared with 2Q 2012. VIP win percentage was a healthy 2.94% in the 12 weeks ended 30th June, but volume dipped slightly (1.6%) to $29.9 billion. Adjusted property EBITDA ended the quarter down 4% to $290.1 million. Mass table revenue was up 8.5% to $217 million, overcoming a 6.7% decrease in drop versus Q2 2012 thanks in part to a higher win percentage of 34.6% versus 29.8% last year. Slot machine handle of $1.2 billion was roughly flat compared with the second quarter of 2012 on 57 fewer machines. Win was down 8.9%. Average daily room rate for the period ($314) was down slightly from last year (-1%), but occupancy improved from 90% to 95.5%, driving a 5% increase in revenue per available room to $300. Non-casino revenue increased 3.3% to $99.9 million. Corporate-wide net revenue for Wynn Resorts (Nasdaq: WYNN) was up 6% to $1.33 billion, boosted by 16.2% higher revenues in Las Vegas. Adjusted corporate EBITDA was up 10.8% to $425.7 million. Net income on a US GAAP basis was $129.8 million, or $1.28 per diluted share, compared with $138.1 million ($1.37 per share) in 2Q 2012. The company said it has approved a cash dividend for the quarter of $1 per share. MGM China Reports Solid 2Q Results Second quarter revenue rose 18% to US$835 million at MGM China, while adjusted earnings climbed 10% to $205 million, setting a new quarterly record. MGM China’s board announced a dividend of $113 million, which will paid on 2nd September to shareholders of record on 26th August. MGM Resorts said that it will receive $57 million, which represents its 51% share of the dividend. Craigie Touts Competition in Queensland Fresh off besting Echo Entertainment in Sydney, Crown Limited sent Chief Executive Rowen Craigie to Brisbane last month to pitch the benefits of letting the casino giant into its rival’s Queensland market. Mr Craigie is reported to have met with officials of the city and the state of Queensland to push a familiar argument— that competition is essential to maximizing Brisbane’s potential as a destination for big-spending international high-rollers—the argument that won the company provisional approval in Sydney for a A$1.3 billion luxury casino and hotel on Darling Harbour within sight of Echo’s monopoly gaming resort, The Star. Crown Chairman James Packer has labeled Echo’s Brisbane, Townsville and Gold Coast casinos a “disgrace,” and it was expected that Mr Craigie would have echoed that sentiment in a meeting with David Edwards, director general of Queensland’s Department of State Development, Infrastructure and Planning. “The point that I made to the director general was that Australia has a 2.5% share of the world VIP gaming market, the high-roller market, and Brisbane’s contribution to that 2.5% is only 0.1%, so that’s obviously the opportunity,” he told The Australian Financial Review . He also met with Brisbane Lord Mayor Graham Quirk. Echo, which operates the Treasury Casino in Brisbane’s central business district, says it wants to invest more than $1 billion in new facilities, but its location in a heritage-listed building has constrained its ability to grow. The company has instead proposed relocating to a two-hectare site on the Brisbane River. Crown, however, is after the same site. Mr Craigie’s visit included an inspection of the site. Queensland is conducting a review, due for release in September, on the best use for the land and has requested meetings with both operators prior to holding a public consultation. Wynn Macau Crown Limited CEO Rowen Craigie