Inside Asian Gaming

inside asian gaming MAY 2015 14 Cover Story “This country has been a work in progress, and we’ve been a work in progress,” NagaCorp Chairman Timothy McNally says. “But we’ve arrived.” NagaCorp’s revenue from NagaWorld in Phnom Penh has expanded at a 28% combined annual growth rate (CAGR) and EBITDA at 30% since 2010. While Macau experienced a historically bleak first quarter this year, NagaCorp’s gaming revenue grew 48% and VIP roll rose 79%. Major expansion of NagaWorld and a new resort in Russia’s Far East are expected to fuel further growth. BUFFER ZONE NagaCorp has come a long way from the barge in the Bassac River, just downstream from its confluence with the Sap River and mighty Mekong, where it began gaming operations 20 years ago this month. The company holds a 70-year casino license—Cambodia’s other casino are generally licensed on an annual basis—that runs through 2065, with a 41-year monopoly within a 200 kilometer (120 mile) radius of Cambodia’s capital Phnom Penh that expires in 2035, with stipulated exclusions for border areas, colonial highland retreat Bokor and Sihanoukville, Cambodia’s main port and a beach resort. It wasn’t until 2003 that NagaCorp operations moved onshore with 44 tables and 211 machines at NagaWorld’s present location “This country has been a work in progress, and we’ve been a work in progress,” NagaCorp Chairman Timothy McNally says. “But we’ve arrived.” 500 meters further upriver, less than a kilometer south of Cambodia’s Royal Palace and the city’s bustling riverside promenade. The company’s $95 million initial public offering in Hong Kong—which saw that exchange’s first listing of a gaming company, prior to the listing of all of Macau’s operators there—provided funds to complete the first phase of the hotel and entertainment complex. Controlling shareholder and CEO Chen Lip Keong, a Malaysian medical doctor and entrepreneur who serves as an economic adviser to Hun Sen, could have financed the project out of his own pocket. “We went to the marketplace to become an international company,” Mr McNally, a former US FBI agent explains. “Dr Chen did it with the vision to be The suites, for players that check in $2 million and roll it six times, have attached gaming rooms. “That’s an advantage over Macau,” Senior Vice President for Casino Operations Vincent Mascio says. “We’re not as regulated on the small things as Macau. It makes life easier.” Cambodia also has no whiff of smoking restrictions on the horizon. NagaWorld ’s recently opened VIP penthouse suites