Tycoon Enrique Razon Jr. on Thursday warned of an “oversupply” of casinos in the Manila Bay area, where his Solaire Resort and Casino operates, with the opening of two more gaming complexes within the next two years.
Solaire’s opening in 2013 marked the launch of the 120-hectare Entertainment City gaming complex, the Philippines’ response to casino hubs in Singapore and Macau.
This was followed in late 2014 with the opening of City of Dreams Manila. Japanese billionaire Kazuo Okada is expected to open his Manila Bay Resorts in Entertainment City by the end of 2016 while Resorts World Bayshore is scheduled to open in 2018.
“It’s too many, too fast,” Razon, chair of Solaire operator Bloomberry Resorts Corp., told reporters on Thursday on the sidelines of the annual meeting of International Container Terminal Services Inc., which he also owns.
“The market is not growing as fast as the industry wants it to,” Razon said. “Supply is growing faster than the market.”
While the Philippines is facing oversupply, regional gaming hubs, meanwhile, are facing harder times. Casinos in Macau, the world’s biggest gambling market, are struggling with slowing earnings growth following an anti-graft campaign launched by Chinese president Xi Jinping.
Amid new supply putting a strain on gaming prospects, Razon said the company was expecting to reverse its P3.37-billion loss in 2015. The firm erased the P4.07 billion profit it posted the previous year.
He said Bloomberry remained keen on expanding its presence overseas. Bloomberry already owns the Jeju Sun Hotel and Casino in South Korea.
Razon said the company was also short-listed to bid for a casino in Cyprus this July and it earlier proposed to build an integrated casino in Argentina.
“The outlook is far better this year,” he said. “We have much lower costs. No more bad accounts, bad debt.”
He also cited growing revenues, after Bloomberry said total revenues in 2015 grew 7 percent to P34.36 billion. He added VIP volume “has [also] been growing.”