Asian casino operator, NagaCorp Limited, has reportedly released its financial results for the first half of 2018 showing that its net profit rose by 19.6% rise year-on-year to $180.1 million thanks to an associated 84.6% increase in aggregated gross gaming revenues to almost $713.9 million.
Cambodian exclusivity paying off:
According to a report from GGRAsia, the Hong Kong-listed firm holds the exclusive license to operate casinos in and around Phnom Penh and inaugurated the first phase of the Cambodian capital’s NagaWorld venue in December 2006. It subsequently opened its Naga 2 expansion in November with the two gambling venues now purportedly connected via the underground NagaCity Walk shopping mall complex.
NagaCorp Limited also saw its most recent first-half earnings before interest, tax, depreciation and amortization hit $233 million. This prompted boutique investment firm Union Gaming Securities Asia Limited to declare in a subsequent update that the casino operator is now likely to see this figure grow by a minimum of 10% over ‘the next few years.’
Mass-market and VIP improvements:
Phnom Penh-headquartered NagaCorp Limited is in the process of building the 279-room Naga Vladivostok venue in south-eastern Russia and saw its six-month mass-market gambling volumes swell by 51% year-on-year to around $573.8 million. This was complemented by a 116.8% boost in VIP rolling chip volumes to approximately $16.84 billion.
Naga 2 spurs success:
Grant Govertsen from Union Gaming Securities Asia Limited reportedly used the update to proclaim that the opening of Naga 2 had ‘spurred demand’ and is now allowing NagaCorp Limited to generate ‘flagship-like gaming volumes’ that are usually only seen at first-tier Macau casinos.
He described the new property as a ‘game changer’ with the most recent financial results indicating ‘the enviable demand trends’ present in Cambodia’s largest city.
Govertsen’s statement reportedly read…
“That the company reported $233 million in earnings before interest, tax, depreciation and amortization during the first half of 2018 and that win per day for tables and slots has steadily increased throughout the period indicates the reception to the property has been impressive. This is echoed by our junket contacts, who instantly turned bullish on bringing customers to [NagaWorld] as soon as Naga 2 opened.”
No signs of cannibalization:
Unlike what oftentimes happens in Macau, Govertsen furthermore stated that the six-month financial results from NagaCorp Limited indicated that there had been no player or gaming position cannibalization between the two NagaWorld casinos.
Govertsen’s statement further reportedly read…
“A hallmark of the recent Macau [integrated resort] openings is that the legacy/sister properties tend to experience a temporary period of cannibalization as not only gaming positions but customers too are lent to the new property.”
News on Naga 3 expansion anticipated:
Finally, Govertsen proclaimed that he now expects NagaCorp Limited to make an announcement on its envisioned Naga 3 expansion sometime within the next year to 18 months.