Inside Asian Gaming

February 2014 | INSIDE ASIAN GAMING 17 this or on the question of whether the tax will apply prospectively or retroactively. PAGCOR’s results for 2013 were flat, totaling PHP40.52 billion in revenues (US$834 million), marginally down from 2012’s PHP40.88 billion but still enough to make it the government’s third-largest source of revenue. PAGCOR predicts 2014 revenue will rise to PHP45.47 billion partly due to increased regulatory fees as Entertainment City continues to come online. The company did, however, close one of its 13 Casino Filipino venues and plans to close another this year. Fitch Ratings is bullish on the Philippines’ prospects, forecasting that the island nation’s share of the global gaming market could grow from an estimated 3.3% currently to 5% in the next three to five years, fueled by “robust domestic demand,” the country’s positioning as a “low-cost tourist destination,” and the development of Entertainment City. Fitch pegs gaming revenues at around US$1.4 billion currently and projects a 12% annual rate of growth through 2020 to more than $3.3 billion, despite potential obstacles such as the taxation issue. The firm says that even in the event of tax increases the country is still a low-cost operating environment. Entertainment City is, of course, the major positive. Solaire, despite its operational issues, posted a profit of PHP165 million (US$3.6 million) in the third quarter, a sharp increase from the previous quarter’s 22.7million. Gaming revenuewas up fromPHP3.89 billion to 4.87 billion. Bloomberry is spending US$480 million on the property’s second phase, which is slated to include a second hotel with 308 rooms and suites, more restaurants, an array of high-end retail outlets and entertainment facilities. Its completion will bring the total cost of the resort to US$1.2 billion. City of Dreams Manila remains on track to open this summer as the second Entertainment City IR. Melco Crown Entertainment’s Philippines subsidiary has partnered with the country’s richest man, retail and property tycoon Henry Sy, on the US$1.3 billion resort, which will feature 1,680 rooms and suites, 1,900 EGMs, 365 table games and a range of non-gaming attractions. In January, Melco announced that it will have a Nobu hotel at the site, the luxury US hospitality chain’s first in Asia. In addition, it said it was raising its investment in the project to US$680 million, with a chance of increasing it further as other brands come on board. Co- Chairman Lawrence Ho was quoted as saying that the country’s gross revenue could easily double to US$4 billion in two years, closing on Singapore’s $6 billion. Universal’s Manila Bay Resorts and Travellers International Hotel Group’s (a Genting Hong Kong-Alliance Global joint venture) Resorts World Bayshore will fill out Entertainment City over the next several years. Travellers’ will-they-won’t-they IPO on the Philippines Stock Exchange was also the subject of some attention in 2013. In December, it said it was still looking for cornerstone investors. The partnership’s existing casino, Resorts World Manila, is still going strong. In the first half of 2013, revenue was up 31% to US$468.9 million and EBITDA was up 40% to $109 million year on year, while daily visits were up 12% to 18,600. Travellers plans to spend $600 million over the next three years to expand the number of hotels as well as to add gaming facilities. COVER STORY Solaire posted a profit of PHP165 million (US$3.6 million) in the third quarter, a sharp increase from the previous quarter’s 22.7 million. Gaming revenue was up from PHP3.89 billion to 4.87 billion. Bloomberry is spending US$480 million on the property’s second phase, which is slated to include a second hotel, more restaurants, an array of high-end retail outlets and entertainment facilities. Resorts World Manila continued its strong performance in 2013.