High costs from the opening of its newest hotel and casino, as well as weak demand from rich patrons, weighed down the first-half earnings of gaming giant Bloomberry Resorts Corp.
The company led by tycoon Enrique Razon Jr. on Wednesday said consolidated net income in the January to June period dropped by 37.5 percent to P4 billion.
Revenues of Bloomberry, the operator of Solaire Resorts and Casino, also registered a slight 3-percent dip to P24.8 billion.
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Gross gaming revenues were likewise down 6 percent to P29.2 billion despite modest growth in mass table games and electronic gaming machines.
Razon, Bloomberry chair and CEO, attributed the decline to the preoperating and operating expenses at the newly opened Solaire Resort North in Quezon City and a “continued weakness” in their VIP segment.
Bloomberry’s nongaming revenue rose by 11 percent to P4.6 billion.
Earnings before interest, taxes, depreciation and amortization (Ebitda) ended at P8.6 billion, down by 24 percent.
According to the company, preoperating expenses at Solaire North, which opened on May 25, totaled P764.1 million. Without this cost, Bloomberry said Ebitda would have declined by only 15 percent year-on-year.
The new hotel and casino operated for 37 days in the second quarter, recording a total P1.1 billion in gross gaming revenues from mass table games and electronic gaming machines.
Nongaming revenue was at P213 million, while Ebitda stood at P250.1 million.
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“We are in the early stages of the property’s ramp-up and are happy with the pace, especially as we compare it to the ramp of Solaire in Entertainment City over 11 years ago,” Razon said in a statement.
“As revenues at our second property grow, we anticipate further synergies and positive operating leverage to contribute to our group’s profitability in the coming quarters,” he added.
At Solaire Resort Entertainment City, Solaire North’s larger and older counterpart, revenues from VIP tables went down by 21 percent to P3.7 billion, dragging down overall revenues by more than a tenth to P11 billion.
Its nongaming revenue inched up by 6 percent to P2 billion.
Meanwhile, gaming revenues of Solaire Korea’s Jeju Sun Resort and Casino soared to P35.7 billion from P4.7 billion previously, signaling strong recovery after its temporary closure at the height of the pandemic.