Investment bank Morgan Stanley has upgraded its earnings estimates for Philippines IR operator Bloomberry Resorts Corp, increasing its 2022 EBITDA estimates by 24% to Php14 billion (US$267.6 million), or 71% of 2019 levels.
The upgrade follows stronger than expected results for the March 2022 quarter, announced last week, with Bloomberry’s flagship Manila property – Solaire Resort & Casino – seeing EBITDA, mass table drop and slot volume return to 57%, 61% and 102% of 2019 levels respectively. Analysts Praveen Choudhary, Gareth Leung and Thomas Allen said mass table drop in March was likely back to 75% of 2019 with VIP recovery expected to accelerate from Q2.
“We raise our estimates for 2Q22 and 2022,” the analysts said.
“We expect 2Q22 EBITDA at Php3.3 billion (US$63.1 million) – +14% quarter-on-quarter and 67% of 2019 levels – driven by robust local demand recovery. We increase our 2022 EBITDA estimate by 24% to Php14 billion (US$267.6 million) – +168% year-on-year and 71% of 2019 – and net profit to Php4.4 billion (US$84.1 million) – 42% of 2019 – as we expect pent-up demand and faster travel recovery.”
The analysts also provided some future estimates for Solaire North, the company’s new integrated resort in Quezon City, due to open next year.
In its first full year of operations in 2024, Morgan Stanley predicts GGR of Php25 billion (US$477.7 million) from Solaire North, representing around 45% of Bloomberry’s 2019 revenues, and EBITDA of Php3.6 billion (US$68.8 million) – 18% of 2019 EBITDA.
“These are based on our assumptions that its gaming productivity is at 50% of Solaire Manila’s in 2024 [based on] capacity data,” they wrote.
The analysts have also upgraded their 2023 EBITDA estimate for Bloomberry by 2% to Php18 billion (US$343.9 million) on VIP revenue reaching 60% of 2019 levels, while the addition of Solaire North has seen their 2024 EBITDA estimates grow by 18% to Php25.2 billion (US$481.5 million) – representing 127% of 2019 levels.