Inside Asian Gaming

June 2012 | INSIDE ASIAN GAMING 51 Briefs racetrack in Queens. The Governor mentioned he is in discussions with other operators to develop a project, though it would be at a different location. MGM Resorts International has indicated it had interest in developing a resort/convention center in New York and Las Vegas Sands Corp and Caesars Entertainment also reported interest in the market. In addition, Genting has commented that it would still be interested in participating in a bidding process for an integrated complex even though its current plans have fallen through. We note that none of the related operating parameters are currently known, however. In a recent note, Union Gaming offered the following view: “Currently, the Jacob K. Javits Convention Center inManhattan is New York’s only space to hold large conventions. However, it is too small to meet the needs of the larger conventions and previous attempts at expansion were deemed too costly to the New York taxpayers. Should New York State’s constitution be amended to include expanded gaming, there would be obvious interest fromwell known gaming operators. There are still several legislative hurdles in place before a casino/convention center could come to fruition in the state. The legislature has approved first-time passage of a constructional amendment to allow casino resorts with slots and table games. However, the amendment must be passed in a consecutive legislative session and then pass a statewide referendum.” Shuffle Master 2Q profit surges 23% Shuffle Master, Inc. reported profit up 23% year-on-year in the second quarter (ended 30th April), despite expenses incurred through the purchase of a European online gaming company. Shuffle Master said its net income was US$9.7 million for the second quarter, compared with $7.9 million in the same quarter last year. The company said its earnings per share in the quarter were 17 cents, a 21% increase over 14 cents per share in the same quarter of 2011. Company-wide revenues were US$66.1 million, up 10% compared with $59.9 million in the second quarter of 2011. Shuffle Master CEO Gavin Isaacs said revenues from the company’s proprietary table game titles leased to casinos were up 13% in the quarter. Mr Isaacs said Shuffle Master’s electronic table game segment was in transition and remains a focus. In March, Shuffle Master agreed to spend US$28.5 million for Ongame Network Ltd, a European provider of online poker products, and subsidiary of bwin.party Services of Austria, one of the world’s largest poker providers to online gaming operators. Shuffle Master said the transaction would allow the company to expand its online offerings in regulated gaming markets. “We are confident that our continued strong momentum across our core businesses and the rollout of our interactive initiatives are key drivers of our future earnings potential and will write the next chapter of our profitable growth story,”Mr Isaacs said. In a note to investors published prior to the company’s earnings report, Roth Capital Partners gaming analyst Todd Eilers said expectations on any growth opportunities had already been priced into Shuffle Master’s stock. He said any material earnings from interactive gaming, through the company’s purchase of Ongame, are further out than most investors realize. “We believe investor expectations and estimates have become more difficult to exceed given several very strong quarters in a row resulting in several upward estimate revisions,”Mr Eilers said. Russian gaming zone looking for developers The city of Vladivostok in Russia is set to announce that is it looking for private investors or gamingoperators toconstruct a casino resort, according to a report from Union Gaming. The government is expected to seek proposals in the June timeframe, give operators sixty days to send/submit formal proposals, and plan on selecting an operator in the fall. The Union Gaming report states: “As a point of reference, in July of 2009 a law went into effect that effectively banned casino gaming operations in all but four remote areas of the country. Up to this point we have seen very little interest in development from domestic or international gaming operators in Russia. The Vladivostok region is in the far eastern region of the country and is relatively close in proximity to Asia (two hours by plane from Seoul and Tokyo). The region is hoping to capitalize on its proximity to Asia to court Chinese gamblers. Press reports suggest that China has an agreement with Russia allowing for groups of Chinese citizens to travel into the country and stay for up to two weeks without obtaining a visa. At this point, it is unclear how much if any interest there will be from major US gaming operators. Historically, gaming legislation/regulation in the country has been unpredictable, which will likely concern potential international developers.” LVS follows Wynn out of Boston race LasVegas Sands Corpannounced it is not interested indeveloping a property in Boston, Massachusetts. The announcement came hot on the heels of Wynn Resorts pulling out of contention for the Zone 1 license (Greater Boston) in the face of local opposition. According to a Union Gaming report, the news of LVS pulling out of Boston is not surprising. The company thinks an investment in the Boston area would not be viable given too much gaming capacity with three casinos and a slot parlor. LVS did spend roughly $0.5 million on lobbying in the state. Caesars Entertainment (CZR) still has a competing plan for a Boston area casino in a partnership with Suffolk Downs. Central Vladivostok