Resorts World owner’s profit down 15.4%

Resorts World Manila (RWM) owner and operator Travellers International Hotel Group Inc. saw a 15.4-percent decline in net profit last year to P3.4 billion on slower high-roller or VIP gaming business alongside higher dollar bond financing costs arising from the peso depreciation.

But Travellers saw a 4-percent rise in cash flow to P6.4 billion following a 2-percent increase in overall net revenues to P25.09 billion on higher earnings from hotel and food/beverage operations as well as better cost management, the company said in a regulatory filing yesterday.

Travellers’ gross gaming revenues slipped by 2.3 percent to P23.65 billion last year mainly due to the 17.4-percent decline in bets made by high-rollers or the VIP segment. The non-VIP business, however, increased by 8.3 percent. Combining the VIP and non-VIP businesses, overall gaming bets or “drops” last year decreased by 10.4 percent from the previous year.

The casino’s “win” rate, on the other hand, improved to a blended rate of 5.2 percent compared to the 4.8 percent registered in the previous year. The VIP win rate likewise improved to 3 percent from 2.8 percent in 2015. This means that while the overall volume of bets declined, Travellers earned more from each peso “dropped” by casino players compared to the previous year.

A casino’s “win” or “hold” rate is based on the element of luck but is also affected by the spread of table limits, a player’s skill and resources and amount of time spent in the casino.

“We are confident that the diversity of our nongaming businesses and attractive entertainment offerings set us apart as a tourism destination,” Travellers president and chief executive Kingson Sian said in a statement. “This will enable us to deliver continued growth and stable financial performance in the years to come.”

Travellers’ net profit has declined in the last two years as competition turned tougher especially with the opening of new integrated gaming resorts in Pagcor’s Entertainment City. But it is banking on expanding nongaming revenues as well as on improving prospects for the overall gaming industry amid higher foreign tourist arrivals. It has built additional hotel and conference facilities to support future growth. —Doris Dumlao-Abadilla