Neptune Group Ltd, a junket operator that once had a thriving operation in Macau has found it difficult to post consistent profits after the anti-corruption crackdown. The company recently announced that it was contemplating shutting down its Macau operation and concentrating on other business interests.

Macau’s casinos were estimated to be making more than 50% of  total gaming revenue from its VIP clientele from Mainland China. Junket operators played an important role as they were tasked with the responsibility of targeting these high stake gamblers and bringing them to Macau’s casinos. The junket operators and Macau’s casinos formed partnerships that proved to be mutually beneficial and extremely profitable, until Beijing decided to crack down on these VIP gamblers.

When Beijing launched its anti-corruption drive in 2014, many believed that it would be for a short term period. Beijing has been relentless for the last 18 months and in the process has scared away VIP gamblers. As a result, junket operators have struggled to bring in a steady flow of VIP gamblers from the Mainland and Macau’s casinos have faced a significant decline in gaming revenue.

Neptune Group Ltd reported that in the fiscal ending 30th June 2015, the company had a loss of over $103 million. The company stated that it is looking at other business opportunities such as security investments and money lending to diversify its business interests and improve profit margins.

The company released a statement found on Asian Gaming Brief which said “The Group may not resolutely to continue its presence in Macau VIP gaming industry anymore if this situation doesn’t correct itself in coming years. Management now face pressing concerns, as scramble to stem profit slide from weak turnover and trying to maintain a healthy cash flow for exploring other business opportunities. But deepening economic fears about China, which culminated last six months in global market rout, we are now forcing a broad rethinking of our business strategy and plotting our profit around China’s rise to some other regions in other Asian countries.”

The junket operator has partnerships with the Sands Macao, the Grand Lisboa and the Venetian Macao to operate VIP rooms. Neptune had an overall loss of 33% in 2015 when compared to the same period in 2014. The company will hold on for a few more months to see if the situation in Macau changes before making a final decision on its Macau operation.

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