Inside Asian Gaming

INSIDE ASIAN GAMING | December 2012 18 FEATURES N agaWorld is not necessarily looking to draw whales to its casino in Phnom Penh, Cambodia. It would much prefer a few big fish. The way the management sees it, a publicly listed gaming operation needs to carefully build its portfolio of players and take on the right kind of risk. For a company like Naga— although successful, still with only a $1.1 billon market capitalization—that means staying away from players who single- handedly can ruin a quarter and crash the stock. If one person walks away with massive winnings in a day or two, that could potentially shake confidence in NagaCorp. “We would rather have 10 rolling in with $100,000 than one with a million,”says Philip Lee, CFO of Hong Kong-listed NagaCorp.“We just don’t want the volatility.” While much has been made of Naga’s many strengths, such as its location, its monopoly license and its fixed tax rate, the way the company ismanagedmight also be as important in the long run. The bean counters, operationsmanagers andpit bosseswill be the ones ultimately who make the property work and keep it from falling into the dangerous traps of the trade. It is no doubt a gaming company, with a lot of flash and no shortage of bells and whistles, literally, but behind the scenes is a dedicated group of no-nonsense businessmen who talk in terms of square meters, drop and turnover. Their business is all about chance, mystery and entertainment, but their focus seems to be on transparency, profit, efficiency and security. The emphasis on the mundane is especially important for Naga. The company started out with a number of strikes against it. Its location, while an asset now, has not always looked so good on paper. Until recently, Cambodia was seen as a relatively dangerous place, and relatively corrupt and undeveloped. When one of the senior managers moved to Cambodia a number of years ago, his friends asked him if it was even possible to get decent food there, and the manager wasn’t too sure himself. To be taken seriously, Naga has had to be extra careful about what may be an afterthought to others. One of the main areas of focus, of course, is anti-money laundering (AML). Cambodia has historically been and remains a place of concern regarding illegal financial transactions. It was number 141 out of 144 countries ranked by the Basel Institute on The Numbers Game While Singapore’s casinos falter and Macau’s high-roller trade stagnates, as Indochina correspondent Richard Meyer reports, NagaWorld appears insulated from weakness in China thanks to its concentration on mass play and its niche catering to lower-end VIPs