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CR88-p18&19-asia1&2:SJC-Casino Review 21/1/10 18:46 Page 2
internationalcasinoreview
Macau’s swing back boosts shares
Shares in Macau casino operators surged following reports that GGR in
December rose 48 per cent from a year earlier with one analyst predicting 17
per cent climb in 2010. Shares of Sands China increased by 4.72 per cent,
Wynn Macau by 3.56 per cent and SJM Holdings by 5.7 per cent.Aaron
Fischer, CLSA’s head of Asian consumer and gaming, said: “The first half will
be very strong; we should see momentum maintain. We believe the earnings
will surprise significantly on the upside. Revenue growth has been very strong
for the last few months and these companies have been cutting costs a lot.”
Another 200 slots on the road
to Phnom Penh’s NagaWorld
The growth in NagaWorld’s slot operation is nothing short of phenomenal. A 1,026.7 per
cent increase over the last two years has seen slot revenues level out at $16.9m. Elixir is
hoping for at least another 30 per cent jump in profitability from its revenue sharing model
with NagaWorld and as such is increasing the number of slots it provides.
phnomomenal 31, 2010, the companies will available prime ground floor since seen revenue from slots improve average WUD in the NagaWorld: the only Las
CAMBODIA share revenue from the slot space at NagaWorld. had risen 1,026.7 per cent year Philippines in the range of 20
Vegas style hotel casino
machines. Elixir will take 25 Given NagaWorld’s position on year to $16.9m. per cent to 30 per cent from
complex in Phnom Penh
Elixir Gaming Technology has percent of the revenues and as the exclusive casino license While the company believes current levels over the next
entered into an agreement with NagaWorld the remainder, the holder in the Phnom Penh area the Philippines remains a two to three years. market. Further, the reduced
NagaWorld to install an extra report said. and our demonstrated viable market for Elixir Gaming Chung concluded: “Elixir depreciation expense will
200 slots in the lobby floor of Clarence Chung, chairman success with our current slot and its operations there are Gaming remains focused on accelerate the time needed for
the capital’s luxury casino over and chief executive officer of operations at NagaWorld, we expected to continue to be a and committed to its opera- us to achieve positive GAAP
the next six months, raising Elixir Gaming, said: “We are feel confident that we can con- meaningful contributor to pos- tions in its existing markets of earnings.
the total number of Elixir- pleased to work with our tinue to drive strong growth in itive cash flow, based on Cambodia and the Philippines. “With the completion of our
owned units from 440 to 640. partner NagaWorld to con- participation revenue and market knowledge gained The valuation review of our restructuring, our improved
Around 120 of the extra tinue to expand its slot floor cash flow with these additional from its operating experience gaming machine assets will financial flexibility, and contin-
machines are expected to be operations. With the addition placements.” over the last year, the company complete the company’s ued strong cash flow projected
operational in the first quarter of these 200 units, Elixir NagaWorld has the monop- has re-evaluated its growth restructuring of its operations from our operations at Naga-
of this year, with another 80 Gaming’s installed machine oly around a 200 kilometre assumptions for its operations under our new management World, we feel confident we
ready by the second quarter base at NagaWorld is radius of Phnom Penh, in this market. Despite the and the resulting write-down now have the right operating
of 2010. expected to reach 640 seats although there are provisions downward revision of the will not only help the company model, experience, and rela-
Under the agreement, during the second quarter of for operations in certain revenue assumptions, with the to better align revenue and the tionships to capitalise on high-
which will see Elixir pay Naga- 2010. With these additional coastal resorts such as Bokor benefit of the ramp-up of related costs but also will ratio- potential growth opportunities
World a US$5.48m commit- units, Elixir Gaming will have and Sihanoukville. It only oper- several immature venues and nalise the carrying value of the in the emerging Asian gaming
ment fee and contract gaming machines installed ated 211 gaming and slot targeted marketing initiatives assets against the projected markets and to enhance
amendment fee by January covering most of the currently machines in June 2008 but has the company still expects to income for the Philippines shareholder value.”
February 2010 • asia&oceanianews 19
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