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Cambodia – Entertainment Gaming Asia enjoys year of growth

By - 14 March 2016

Despite a disappointing fourth quarter, Entertainment Gaming Asia reported revenue for the year of $31.5m, an increase of 41 per cent compared to $22.4m for the 2014 fiscal year due to increases in both the gaming operations and gaming products business divisions.

The increases were due to improvements in the Cambodia operations partially offset by declines in the Philippines operations.

Gaming operations revenue was $18.1m for the 2015 fiscal year, an increase of 11 per cent compared to $16.4 million in the 2014 fiscal year. Average consolidated daily net win per unit was $122 for the 2015 fiscal year, an increase of 16 per cent compared to $105 in the 2014 fiscal year.

The company’s fourth quarter of 2015 had slowed though with consolidated revenue of $7.3m, a decrease of 12 per cent compared to $8.3m in the fourth quarter of 2014 due to a decrease in gaming product sales partially offset by an increase in gaming operations revenue.

Clarence Chung, Chairman and Chief Executive Officer of Entertainment Gaming Asia, said: “We are pleased to report a profitable 2015 fiscal year driven by strong gaming operations revenue, record gaming products performance and cost controls. We accomplished this despite incurring approximately $3m in non-cash charges associated with both impairments of certain gaming operations assets and the loss on disposal of obsolete equipment for the gaming products division in the fourth quarter. As a result of this solid performance, we have increased our cash position by nearly $13.4m in the 2015 fiscal year to $30.7m as of December 31, 2015. We are focused on utilizing these resources to secure projects in new and existing markets with the goal of fuelling long-term growth for the company.”

Cambodia average daily net win per unit was $152 for the 2015 fiscal year, an increase of 24 per cent compared to $123 in the prior year primarily due to improved performance at NagaWorld and a lower machine base at Thansur Bokor. NagaWorld average daily net win per unit was $225 in the 2015 fiscal year, an increase of 19 per cent compared to $189 in the prior year mainly as a result of lower player traffic in the 2014 fiscal year primarily due to political and labor unrest in the first half of the year and NagaWorld renovations of the casino floor that impacted certain areas of the Company’s slot operations in the second half of the year.
Philippines average daily net win per unit was $65 for the 2015 fiscal year, a decrease of eight per cent compared to $71 in the prior year. The decrease was primarily due to increased competition from the development of integrated casino resorts in Manila over the last several years.

Revenue from gaming products was $13.4m for the 2015 fiscal year compared to $6m in the 2014 fiscal year. The increase was primarily a result of higher gaming chip and plaque sales related to both new casino openings and existing customer reorders in the 2015 fiscal year compared to the prior year. Orders from new casino openings represented $4.8m and $3.5m in revenue for the 2015 and 2014 fiscal years, respectively. The Company achieved a gross profit of $2.1m for this division for the 2015 fiscal year compared to a gross margin loss of $1.8m in the prior year. The gross margin increase was primarily due to higher production volumes and improved efficiencies for gaming chips and plaques in the 2015 fiscal year and production inefficiencies related to the plaque operations and temporary machinery issues in the 2014 fiscal year.

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