PH Resorts flags worsening financials due to Emerald Bay development

Philippines

Viviana Chan

-

November 18, 2024

0

PH Resorts flags worsening financials due to Emerald Bay development

Embattled PH Resorts Group reported a net loss of PHP392.9 million ($6.7 million) for the nine months ended September 30th, 2024.

This figure represents an improvement compared to the PHP2.20 billion ($37 million) loss during the same period in 2023. However, the Group continues to face financial difficulties, primarily driven by Emerald Bay’s pre-development expenses. As of September 30th, 2024, the Group’s deficit stood at PHP7.22 billion ($123 million), up from PHP4.81 billion a year earlier.

Additionally, according to the quarterly results updated to the Philippine Stock Exchange on Friday, PH Resorts reports that its current liabilities exceeded its current assets by PHP12.55 billion ($214 million), compared to PHP4.15 billion ($71 million) at the end of 2023.

Negative operating cash flows of PHP127.8 million for the first nine months of 2024, compared to PHP41.7 million ($710,000) in 2023, have raised concerns about the Group’s ability to continue as a going concern. These financial challenges suggest significant uncertainty regarding the Group’s ability to meet its obligations and realize its assets in the normal course of business.

The Group, which is active in the gaming and tourism sectors, has an ongoing construction project, Emerald Bay, on Mactan Island, Cebu, which is expected to benefit from a 7-year exclusivity period upon completion. It also operates a resort on Panglao Island, Bohol, which began commercial operations in 2018.

Emerald Bay, PH Resorts, Philippines — _{Emerald Bay, project render}

To secure new investments, PH Travel, the Group’s subsidiary, initially signed a term sheet with Bloomberry Resorts Corporation (BRC) in May 2022 for a potential investment in LLI and CGLC. However, BRC terminated the agreement in March 2023, prompting PH Travel to seek alternative investors. In December 2023, PH Travel entered into a new agreement with Tiger Resort Leisure & Entertainment, Inc. (TRLEI) to take over the Emerald Bay project.

Unfortunately, this term sheet was also terminated in July 2024, despite receiving nonrefundable payments of PHP327.6 million ($5.6 million), which were later reclassified as income. This development has allowed PH Travel to reengage with other investors, and discussions are ongoing with multiple strategic parties as due diligence continues.

To address its liquidity issues, PH Resorts Group has secured financial support from its ultimate parent company, which has committed to covering operating expenses and helping the Group meet its financial obligations. The Group is also in ongoing discussions with the Land Bank of the Philippines to extend repayments on a PHP975.0 million ($16.6 million) loan, with Udenna Corporation providing a support letter to ensure repayment.

Furthermore, the parent company has pledged to honor the PHP1.0 billion ($17 million) deposit related to the terminated agreement with BRC until repayment is feasible. Despite these challenges, PH Resorts remains optimistic about its ongoing investor discussions and believes these efforts will generate sufficient cash flow to meet its obligations and sustain its operations moving forward.

According to the latest data from the Statistics and Census Service (DSEC), the number of MICE events in Macau rose by 29.8 percent year-on-year to 1,011 during the first nine months of 2024, reaching 94 percent of pre-pandemic levels seen in 2019. This increase translates to an additional 232 events compared to the same period last year, indicating a strong recovery in the sector.

The surge was primarily driven by meetings and conferences, which saw a 30.2 percent rise year-on-year, totaling 943 events. The number of participants in these events grew by 12.7 percent, reaching 136,000. However, the exhibition segment faced challenges, with only 40 events held—down by four compared to 2023—and a 21.7 percent drop in attendees, totaling 856,000.

Despite this decline, exhibitions managed to attract 4,680 exhibitors and 28,295 professional visitors, though these figures represented slight year-on-year decreases of 0.7 percent and 9.2 percent, respectively. Notably, over half of the exhibitors (50.1 percent) and professional visitors (53 percent) were non-locals, marking increases of 1.4 and 8.5 percentage points, respectively.

In terms of content focus, nearly 41 percent of events in the first three quarters were centered on “Commerce & Management,” accounting for 409 events. Other popular topics included “Information Technology” (108 events), “Tourism” (108 events), and “Medical & Health” (97 events), collectively making up a significant portion of Macau’s MICE calendar.

The incentive segment also experienced positive growth, with 28 incentive events held—an increase of 17 events compared to the previous year. The number of participants rose by 16 percent, reaching 12,000, highlighting continued interest in incentive-driven travel to Macau.

The third quarter of 2024 presented mixed results for Macau’s MICE sector. While the number of events grew by 16.7 percent year-on-year to 300, the total number of participants and attendees declined by 4.8 percent, totaling 521,000. Non-gaming receipts for the quarter amounted to approximately MOP2.02 billion ($251 million), a decline of 17.3 percent compared to the same quarter in 2023 (MOP2.44 billion). However, these revenues showed a significant rebound of 36.4 percent from the second quarter of 2024 (MOP1.48 billion), suggesting a gradual recovery.

During this period, there were 276 meetings and conferences, up by 19 percent year-on-year, while the number of exhibitions decreased by six to a total of 14. These exhibitions drew 1,685 exhibitors and 9,178 professional visitors, demonstrating sustained interest despite the overall decrease in numbers. Additionally, the number of incentive events increased to 10, up by five from the previous year.

The Thai government is advancing an “entertainment complex” bill, which would allow casinos to operate within large-scale venues. Prommin Lertsuridej, Secretary-General to Prime Minister Paetongtarn Shinawatra, has indicated that the bill is expected to pass through both chambers of parliament in 2025.

The Cabinet is anticipated to approve the bill later this year, after which it will be reviewed by the House of Representatives and the Senate next year. Each chamber typically takes several months to approve a bill through its three readings.

Prommin told Bloomberg News, “The law should be passed in six months at the earliest, so it should be next year to start.” He added that several administrative steps would follow after the bill clears parliament before casinos can begin operations.

Thailand set to outpace Singapore as world’s third-largest gaming hub: Citigroup

If fully implemented, casinos in Thailand could make the country a major player in the global gaming market. Citigroup analysts predict that the country’s gross gaming revenue could reach $9.1 billion, positioning it as the third-largest gaming market in the world, behind Macau and Las Vegas, but ahead of neighboring Singapore.

Global operators like Galaxy Entertainment Group, MGM Resorts International, and Las Vegas Sands Corp. are eyeing opportunities in Thailand, seeing it as a potential hedge against uncertain prospects in Macau.

According to Prommin, the Thai government has attracted interest from major investors with global experience, though he did not disclose any names. “So many people have tried to talk with us,” he said.

The proposed legislation mandates that Thai-registered companies operate entertainment complexes with a paid-up capital of at least THB10 billion($286 million). A 30-year license will cost THB5 billion ($148 million) in the first year, with subsequent renewals costing THB1 billion ($30 million) annually, which can be extended for up to 10 years with each renewal.

A committee led by the prime minister will later finalize regulations, including casino tax rates, the number of licenses issued, and the casinos’ locations. Under the bill, each complex will need to house at least four other types of businesses, such as department stores, hotels, amusement parks, restaurants, or nightlife venues, alongside the casino.

As previously reported, the government may initially grant five casino licenses in popular tourist destinations, with two in Bangkok and one each in Pattaya, Chiang Mai, and Phuket. Earlier this year, the lower house of parliament approved a study recommending the establishment of casinos in large entertainment venues to attract high-spending visitors.

In the Macau gaming market for Q3 2024, Sands China lead with a market share of 24.5 percent, followed by Galaxy Entertainment Group at 19.1 percent, Melco Resorts with 14.7 percent, closely followed by MGM Macau with 14.8 percent, Wynn Macau with 12.8 percent, and SJM Holdings with 14.1 percent.

Macau gaming operators market share — _{Market share held by the Macau Big Six during Q3 of 2024}

SJM Holdings reported a total GGR of $890 million in Q2 2024, which increased to $967 million in Q3, being the only of Macau’s six gaming operators to report a quarter-to-quarter increase.

Its market share rose from 12.7 percent in Q2 to 14.1 percent in Q3, indicating SJM’s efforts to regain footing in the competitive landscape, especially in the VIP segment.

In terms of mass gaming, SJM’s mass GGR increased from $821 million in Q2 to $867 million in Q3, with its mass-market share rising from 13.4 percent to 14.3 percent. Additionally, SJM’s VIP GGR grew from $69 million in Q2 to $100 million in Q3, with its VIP market share increasing from 8.1 percent to 12.4 percent.

Melco Resorts experienced a decrease in total GGR from $1.04 billion in Q2 to $1.01 billion in Q3 2024. Its market share slightly decreased from 14.9 percent to 14.7 percent.

Despite this drop in GGR, Melco remains competitive through targeted strategies, particularly in the premium mass market segment. For mass gaming, Melco’s mass GGR was $877 million in Q2 and slightly decreased to $854 million in Q3, maintaining a market share of 14.1 percent. In the VIP segment, Melco’s VIP GGR rose from $168 million in Q2 to $159 million in Q3, with a VIP market share of 19.6 percent.

MGM Macau’s total GGR fell from $1.12 billion in Q2 to $1.01 billion in Q3. Its market share also dropped from 16.1 percent to 14.8 percent. This decline may be attributed to increased competition from other operators and shifting consumer preferences.

In mass gaming, MGM’s mass GGR increased from $1,012 million in Q2 to $922 million in Q3, with a market share of 15.2 percent. MGM’s VIP GGR decreased from $112 million in Q2 to $93 million in Q3, leading to a drop in its VIP market share from 13.2 percent to 11.5 percent.

Sands China maintained steady performance, reporting a total GGR of $1,710 million in Q2, slightly declining to $1,682 million in Q3. Its market share remained consistent at 24.5 percent. Sands China’s diversified offerings, including shopping and dining, continue to attract visitors.

In the mass market segment, Sands reported a mass GGR of $1.53 billion in Q2, which slightly declined to $1.50 billion in Q3, with a market share of 24.8 percent. In the VIP segment, Sands China’s VIP GGR rose from $179 million in Q2 to $177 million in Q3, with a VIP market share of 21.8 percent.

Wynn Macau’s total GGR decreased slightly from $887 million in Q2 to $880 million in Q3. Its market share remained steady at 12.8 percent. However, Wynn faced challenges in attracting high-rolling VIP players, impacting its growth potential.

In the mass market, Wynn’s mass GGR was $746 million in Q2 and marginally decreased to $739 million in Q3, with a market share of 12.2 percent. Wynn’s VIP GGR remained stable at $141 million for both Q2 and Q3, with a VIP market share of 17.3 percent.

Galaxy Entertainment Group showed a slightly different trend, with total GGR increasing from $1,33 billion in Q2 to $1,31 billion in Q3. Its market share remained stable at 19.1 percent. Galaxy’s focus on entertainment and integrated resort experiences has resonated well with guests, solidifying its position as a market leader.

Galaxy Entertainment, Raffles Hotel, Macau

In the mass market, Galaxy’s mass GGR rose from $1,15 billion in Q2 to $1,16 billion in Q3, with a market share of 19.3 percent. In the VIP segment, Galaxy’s VIP GGR decreased from $179 million in Q2 to $142 million in Q3, leading to a VIP market share of 17.5 percent.

Ordinary profit is now expected to decline from JPY20 billion ($130 million) to a loss of JPY8.7 billion ($56 million). Additionally, net income attributable to owners of the parent has been revised from JPY19.6 billion ($127 million) to a loss of JPY18.3 billion ($119 million), and net income per share has been adjusted from JPY252.93 ($1.64) to JPY236.15 ($1.53).

This marks a substantial downward revision of JPY74 billion ($481 million) in net sales and a 94.4 percent decrease in operating profit.

These adjustments are primarily due to delays in the release of key titles in the Amusement Equipment Business and ongoing challenges in the Integrated Resort (IR) Business, particularly concerning a potential decline in VIP customers in the Philippines.

In light of this revised business outlook, Universal Entertainment has also updated its dividend forecast.

The year-end dividend has been decreased from JPY30.00 ($0.19) per share to JPY0.00, resulting in a total annual dividend of JPY30.00 ($0.19) per share. This change reflects the company’s commitment to aligning its dividend policy with its current financial situation.

Macau is in need of more overseas travellers – MGM Executive Director

China
Macau

Nelson Moura

-

November 18, 2024

0

Macau is in need of more overseas travellers – MGM Executive Director

Pansy Ho, the chairwoman and executive director of MGM China, has articulated a vision for Macau that extends beyond its traditional reliance on mainland Chinese tourists.

Speaking to reportersa recent press conference, Ho underscored the importance of attracting a broader international audience to fulfill Beijing’s aspirations for Macau to evolve into a vibrant global city, the South China Morning Post reported.

Ho referred to comments made by Xia Baolong, the director of the Hong Kong and Macau Affairs Office, who called for Macau to enhance its international profile and to “polish its golden business card.”

This call to action came during Xia’s inspection visit in May, where he encouraged Macau to embrace its potential as a cosmopolitan center.

Ho highlighted that while Macau has seen a significant influx of visitors—25.92 million in the first nine months of the year—most of these arrivals were from mainland China and Hong Kong.

Specifically, only 1.68 million, or about 6.48 percent, were international tourists, although this figure represents a remarkable 95.1 percent increase compared to the same period the previous year.

Emphasizing the need for change, Ho stated, “It is not that we don’t welcome mainland tourists, but the proportion should be adjusted to fulfill the call.” She believes that diversifying the tourist base is crucial for Macau’s long-term growth and sustainability as a premier global destination.

Wynn celebrates exceptional talents at the Skills Program Graduation Ceremony

Macau

AGBrief Editorial

-

November 17, 2024

0

Wynn celebrates exceptional talents at the Skills Program Graduation Ceremony

Wynn Resorts Macau recently hosted the “Wynn Management Skills Program” graduation ceremony at MPU, celebrating 45 exceptional trainees who were awarded certificates.

The “Wynn Management Skills Program” is a training program launched by Wynn Resorts Macau in collaboration with the Macao Polytechnic University (MPU), provides a two-year professional training program for Wynn management staff in different fields and cultivates outstanding management talent with all-round interdisciplinary strategic thinking and global visions.

Talent development is an important cornerstone for propelling moderate economic and industrial diversification. In tandem with the SAR Government’s policy, Wynn has been actively providing diverse training programs for its team members in the hope of fostering more outstanding local talent and creating more upward mobility and horizontal development opportunities for them.

MPU Rector, Prof. Im Sio Kei, remarked in his speech that “MPU shares the same philosophy as Wynn in fostering interdisciplinary versatile management talent to contribute toward the adequate economic diversification of Macao. The “Wynn Management Skills Program” that they co-run with Wynn aims to nurture outstanding management talent with all-round interdisciplinary strategic thinking and global visions. MPU is very pleased to have established this long-term cooperation with Wynn to jointly foster a sustainable pool of high-quality integrated tourism and leisure professionals for Macao.”

Ms. Linda Chen, President and Vice Chairman of the Board of Wynn Macau Limited, expressed in her speech that “Wynn is truly honored to partner with MPU to run a series of professional courses. These courses allow the trainees to gain sharper business insight and broad visions of the market, which can deepen their understanding of innovative technology and the ever-changing business environment and are very important for their career development.”

Guests attending the Wynn Management Skills Program graduation ceremony also included:

Mr. Frederic Luvisutto, Chief Operating Officer and Executive Director of Wynn Macau Limited;
Mr. Craig Fullalove, Chief Financial Officer and Chief Administrative Officer of Wynn Macau Limited;
Dr. Barry Ip, Vice President of Learning and Advancement of Wynn Macau and Wynn Palace;
Ms. Stephanie So, Vice President of Human Resources of Wynn Macau;
Director Prof. Wang Changbin and Deputy Director Mr. Siu Yu Ning of the Centre for Gaming and Tourism Studies of MPU, among others.

The “Wynn Management Skills Program” co-run by Wynn and MPU is a training program for Wynn management staff. The two-year program is a benchmark for cross-disciplinary study as it covers regional and national industrial development, trends of digital finance, current application of high technology in tourism and entertainment scenarios, and integrated resort management models featuring interdisciplinary collaboration. Through different forms of lectures, seminars, group work, and exchanges, the program aims to nurture management staff with high potential and guide them to reconsider their future career path and development.

Through different forms of lectures, seminars, group work, and exchanges, the program aims to nurture management staff with high potential and guide them to reconsider their future career path and development. The “Wynn Management Skills Program” has also received full support from Wynn’s senior executives, who attended several sharing sessions with the trainees about the company’s strategy and vision.

Moreover, the training program also features a showcase of innovative and creative cases, where the project of the winning groups will be applied in daily operations, thus giving the trainees a lot of encouragement.

At present, around 40% of the participating Wynn executives have been promoted or entrusted with more challenging responsibilities.

Inspired by the event and the specially organized artistic exchange with local Macau artist MCZ_Thomas, the participants painted their unique designs onto ceramic plates. Having enjoyed the creative process, the children shared their creative ideas and proudly took home their works as commemorative pieces.

Melco Resorts supports cultural exchange at City of Dreams' Basquiat Exhibit — _{Macau artist MCZ_Thomas}

The debut of the “Crowning Journey of Jean-Michel Basquiat” event is co-organized by Melco’s City of Dreams and Artelli – The Pioneering Multi-dimensional Art Space and supported by the Macao Government Tourism Office and Cultural Affairs Bureau of the Macao SAR Government.

Albert Zorrilla, Managing Director of Zitro for Spain said: “At Zitro, we firmly believe in the power of diversity as a driver of growth and development. This collaboration with Grupo OSGA not only enriches our company but also reinforces our commitment to contributing to a fairer and more inclusive society.”

Oscar Galilea, President of Grupo Osga added: “The collaboration with a prestigious international company like Zitro not only constitutes recognition of the work that Grupo OSGA has been carrying out but also contributes to the generation of real opportunities for people with disabilities to achieve effective and stable integration in the labor market.”

The launch with Hard Rock Bet will see Greentube amplify its US exposure and reach a growing new audience in New Jersey, thanks to the operator’s globally recognizable brand and popularity. Greentube and Hard Rock Bet look forward to launching gaming content together in additional states and markets in the future.

Markus Antl, Director of Global Sales and Key Account Management at Greentube, said: “We are delighted to collaborate with Hard Rock Digital, a brand that is famous and recognizable to people everywhere. The partnership in New Jersey is a long-awaited one for us and we look forward to introducing our content to even more players in the state.”

Grant Williams, SVP of Casino at Hard Rock Digital, said: “We’re thrilled to welcome Greentube to Hard Rock Bet, and continue to add to the over 2,200 gaming experiences found on our top-rated platform. With one of the largest selections of games in the market, engaging promotions like our just-completed Slots Championship, and our integrated rewards, Greentube’s premium content is yet another reason to Roll With Hard Rock Bet.”

PH Resorts flags worsening financials due to Emerald Bay development

Embattled PH Resorts Group reported a net loss of PHP392.9 million ($6.7 million) for the nine months ended September 30th, 2024.

Table of Contents

Macau’s MICE generates over $557M in non-gaming revenue in 9-month period

Macau’s Meetings, Incentives, Conferences, and Exhibitions (MICE) sector continues to drive non-gaming revenue, generating MOP4.48 billion ($557 million) in the first three quarters of 2024.

Table of Contents

Thailand’s casino bill poised for approval in 2025: Gov’t

Table of Contents

Universal Entertainment downgrades predictions for 2024 results

Universal Entertainment Corporation has announced a significant revision downward of its business results and year-end dividend forecast for the full year.

Macau is in need of more overseas travellers – MGM Executive Director

Pansy Ho, the chairwoman and executive director of MGM China, has articulated a vision for Macau that extends beyond its traditional reliance on mainland Chinese tourists.

Wynn celebrates exceptional talents at the Skills Program Graduation Ceremony

Wynn Resorts Macau recently hosted the “Wynn Management Skills Program” graduation ceremony at MPU, celebrating 45 exceptional trainees who were awarded certificates.

Guests attending the Wynn Management Skills Program graduation ceremony also included:

Table of Contents

Melco supports cultural exchange at City of Dreams’ Basquiat Exhibit

Table of Contents

Zitro and Grupo OSGA partner to foster workplace inclusion for people with disabilities

Zitro, a top player in the gaming sector, has entered into a partnership with Grupo OSGA, a business group dedicated to enhancing employment opportunities for individuals with disabilities.

Table of Contents

Greentube boosts New Jersey presence with Hard Rock Bet launch

Greentube, the NOVOMATIC Digital Gaming and Entertainment division, has signed its latest partnership agreement in the US with Hard Rock Digital and will launch its award-winning content portfolio on the highly-rated Hard Rock Bet casino platform in New Jersey.

Table of Contents

ENQUIRIES & SUBSCRIPTIONS

CONTACTS

FOLLOW AGB

Embattled PH Resorts Group reported a net loss of PHP392.9 million ($6.7 million) for the nine months ended September 30th, 2024.

Table of Contents

Macau’s Meetings, Incentives, Conferences, and Exhibitions (MICE) sector continues to drive non-gaming revenue, generating MOP4.48 billion ($557 million) in the first three quarters of 2024.

Table of Contents

Table of Contents

Sands China remained the operator with the largest market share in the Macau SAR during the third quarter of 2024, however, SJM reported the only sequential increase in market share among the city’s six gaming concessionaires, data published by Deutsche Bank shows.

Table of Contents

Universal Entertainment Corporation has announced a significant revision downward of its business results and year-end dividend forecast for the full year.

Pansy Ho, the chairwoman and executive director of MGM China, has articulated a vision for Macau that extends beyond its traditional reliance on mainland Chinese tourists.

Wynn Resorts Macau recently hosted the “Wynn Management Skills Program” graduation ceremony at MPU, celebrating 45 exceptional trainees who were awarded certificates.

Guests attending the Wynn Management Skills Program graduation ceremony also included:

Table of Contents

Table of Contents

Zitro, a top player in the gaming sector, has entered into a partnership with Grupo OSGA, a business group dedicated to enhancing employment opportunities for individuals with disabilities.

Table of Contents

Greentube, the NOVOMATIC Digital Gaming and Entertainment division, has signed its latest partnership agreement in the US with Hard Rock Digital and will launch its award-winning content portfolio on the highly-rated Hard Rock Bet casino platform in New Jersey.

Table of Contents

ENQUIRIES & SUBSCRIPTIONS

CONTACTS