Philippines real estate firm Belle Corp has reported an 11% decline in consolidated revenues to Php5.77 billion (US$113 million) for the nine months ended 30 September 2019, negatively impacted by increased lottery competition and the temporary closure of all Philippines lottery outlets in July.
The decline comes despite a 4% increase in revenue from real estate operations to Php2.52 billion (US$49 million), of which Php2.0 billion is from the leasing of the land and buildings that comprise City of Dreams Manila to Melco Resorts and Entertainment (Philippines). Belle Corp also earns a share in revenue from City of Dreams Manila via its 78.7%-owned subsidiary Premium Leisure Corp (PLC) but did not release details of that revenue share for the period in question.
Instead, Belle Corp revealed in a trading update that while it “continued to experience growth at City of Dreams Manila,” its overall operating performance had been impacted by weaker results from Pacific Online Systems Corporation, which leases online betting equipment to the government-owned Philippine Charity Sweepstakes Office (PCSO) for their lottery and keno operations. Pacific Online is 50.1%-owned by PLC.
Belle Corp said that Pacific Online suffered a 51% decrease in revenues for the first nine months of 2019 to Php766 million due to competition from the Small Town Lottery and the temporary suspension of lottery and keno operations by the PCSO during 3Q19.
Philippines President Rodrigo Duterte shut down the PCSO and all lotteries it operates in July due to alleged widespread corruption within its ranks, before partially lifting the ban on the PCSO’s lotto operations a week later.
In Friday’s update, Belle Corp said that, “With the suspensions since lifted, Pacific Online is working closely with the PCSO and its network of agents to boost the attractiveness of the pari-mutuel games it offers, and is working to implement cost efficiency measures across its operations.”
Belle’s consolidated net income through 30 September 2019 was 18% down on the same period in 2018 to Php2.18 billion.