Melco Crown (Philippines) Resorts Corp, operator of the Philippine casino resort City of Dreams Manila, reported net operating revenue of PHP2.34 billion (US$52.4 million) for the three months ended March 31, up from PHP21.3 million a year earlier.
The increase was driven by the opening of the casino resort in December – the property was in its development stage in the first quarter of 2014. City of Dreams Manila (pictured) had a soft opening on December 14, followed by an official inauguration on February 2.
Melco Crown Philippines recorded PHP1.95 billion in revenue from the casino operation, representing 83 percent of total net operating revenues, the firm said in a filing to the Philippine Stock Exchange.
Rolling chip volume for the three months ended March 31 was PHP8.2 billion, the firm said. Rolling chip win rate – calculated before discounts and commissions – was negative 0.8 percent, it said.
The mass-market table games drop was PHP4.5 billion in the first quarter of 2015, with the hold percentage at 25.2 percent, the company added.
The growth in operating revenues however was not enough to offset the increase in expenses during the period. Operating expenses for the first three months of 2015 totalled PHP4.75 billion, up from PHP452.3 million a year earlier.
David Bain of U.S.-based brokerage Sterne Agee CRT said of City of Dreams Manila in a Friday note about Melco Crown Entertainment Ltd, the parent of Melco Crown Philippines: “Management noted a potential near-term ramp of international VIP revenue via a new junket operator. Further, several amenities required to induce international VIP travel, including the DreamWorks family entertainment centre, many beach and pool villas, have only just been completed. We forecast a sustained sequential EBITDA [earnings before interest, taxation, depreciation and amortisation] ramp over the next seven quarters.”
UBS AG said in a note on Thursday that Macau junket investor Suncity Group was holding what the bank called a “grand opening” at City of Dreams Manila that weekend.
Melco Crown Philippines posted a net loss of PHP3.09 billion for the three months ended March 31, up by 219 percent from the prior-year period. The firm said the widening loss was primarily related to gaming tax and licence fees, inventories consumed, employee benefit expenses and payments to its Philippines partners, among other expenses.
City of Dreams Manila involves a partnership with Philippine-based Premium Leisure and Amusement Inc, a unit of Premium Leisure Corp, controlled by the family of Philippine billionaire Henry Sy.
The casino resort received its full gaming licence last week from the country’s casino regulator, the Philippines Amusement and Gaming Corp.