Inside Asian Gaming

inside asian gaming September 2014 30 VIP baccarat’s contribution to total gaming revenue in Macau peaked at more than 73% in 2011 but has been declining since then as its growth has been continuously outstripped by that of the mass market. By 2013, VIP accounted for just under two-thirds of total gaming revenue. The decline accelerated this year with a contraction in the VIP sector, pushing the contribution to just 60% in the second quarter. While many of Macau’s junket operators—who supply the city’s casinos with the vast majority of their VIP players—have been reeling under the sector’s slowdown, it’s the smaller ones that appear to be hurting most, while the larger ones, including Top 3-ranked Neptune Group, appear to be holding firm. The sector has entered a period of consolidation, and when it recovers the larger operators stand to emerge even stronger. Nicholas Niglio’s presence as the only non-Chinese member of the board of directors of Neptune Group speaks volumes to the esteem in which he is held in Macau and Hong Kong by players, operators and investors. With three decades of experience on two continents to his credit, Mr Niglio is charged with heading Neptune’s strategy of “continued controlled growth”. He was schooled in the hyper-competitive world of Atlantic City gambling in its heyday, joining Resorts International in administration in 1978 and moving into casino marketing. He served as vice president of casino operations at Caesars, the city’s pre-eminent high-roller venue of the time, and was senior vice president of Eastern Operations before moving to the Trump casinos in the early ’90s, where at various times over an eight-year career he headed up every facet of domestic and international marketing. The seven years in which he’s been in charge at Neptune have Nicholas Niglio Executive Director and CEO Neptune Group seen the company grow not only in size but in scale. In addition to a comprehensive range of travel and hospitality services it provides its VIP clients, Neptune has begun to exert a sizable impact on the bigger picture, notably launching two of the flashiest high-stakes poker tournaments in the world—the HK$2 million buy-in “Macau High Stakes Challenge,” which attracted the likes of Phil Ivey, Tom Dwan, Sam Trickett and Eric Seidel to StarWorld Hotel two years ago to compete for the largest prize pool ever offered outside the World Series of Poker—and last year’s “Asia Millions,” co-sponsored with PokerStars, a HK$1 million buy-in shark fest that drew to City of Dreams about 100 big-time players from every corner of the globe. Mr Niglio joined Neptune as an executive director in September 2007, shortly after the listed entity was created out of an existing Hong Kong-listed company called Massive Resources International Corp., which previously traded electrical equipment and securities. Neptune thus became the first Macau junket operator to gain access to Hong Kong’s stock market via a backdoor listing, a trend that picked up this year with First Natural Food Holdings’ HK$400 million (US$51 million) investment in Hengsheng Group in March and Macau junketeer Jack Lam’s purchase, along with two British Virgin Islands entities, of 66% of Sinogreen Energy International Group for HK$113.8 million, setting the stage for the listed company’s absorption of part of Mr Lam’s Jimei Group. City of Dreams was arguably the pioneer in targeting the high-limit cash players known in Macau as the “premium mass,” a segment offering significantly higher margins for operators than VIP and one that is showing more robust growth than the junket-driven high-roller business that has witnessed a significant slowdown of late. Ted Chan Chief Operating Officer Melco Crown Entertainment