Operator News
Russia – Revenues at Tigre de Cristal exceed expectations
By Phil - 25 March 2018
Tigre de Cristal, Summit Ascent’s resort casino in the Russian Far East, helped drive a revenue increase of 46 per cent in 2017 with GGR up to HK$470.8m(US$59.98m).
Adjusted Property EBITDA generated by Oriental Regent Limited, a subsidiary of the Group through which Tigre de Cristal, is operated, was HK$173.7m for the year 2017, up from HK$131.5m, representing an increase of 32 per cent year-over-year.
The Group’s total revenue for the year 2017 was HK$470.8m marking an increase of 46 per cent year-over-year. The main contribution to the profitability of the group is the rolling chip business, which targets VIP customers from Northeast Asia. Rolling chip turnover at Tigre de Cristal in 2017 amounted to HK$18.8bn up from HK$14.1bn, representing an increase of 33 per cent year-over-year.
Kuo Jen Hao, Chairman and Non-executive Director, said: “2017 was the second full year operation of our majority-owned hotel and casino resort Tigre de Cristal. Tigre de Cristal generated an adjusted property EBITDA of HK$173.7m for the year, representing a year-over-year increase of 32 per cent. Most impressively, this was achieved during a period of substantial ownership changes at the Summit Ascent level, the changeover of Chief Operating Officer at Tigre de Cristal, policy uncertainties regarding gaming taxes in the Russian Federation as well as geopolitical instability in the region.”
The operator will benefit strongly from a ruling on 28 February 2018, when the local parliament of Primorsky Krai voted overwhelmingly to maintain the gaming tax rates at existing levels, despite the new power given to them to double gaming tax pursuant to a new federal law enacted on 27 November 2017. Accordingly, no changes in gaming tax rates have been applied to Tigre de Cristal.
Mr. Hao added: “I would also like to express my appreciation for the government officials in the Russian Far East for their ongoing support and in particular, the tremendous efforts they made in maintaining consistent tax and regulatory stability that makes the Russian Far East such an attractive destination for investment. With the support and cooperation of our devoted management team and staff, a pro-business government in the Russian Far East and our new shareholders and investment partners, I maintain a positive view towards Summit Ascent’s business prospects going forward.”
Union Gaming analyst Grant Govertsen said Summit Ascent had exceeded expectations, in terms of revenue and EBITDA and will benefit from the government cleaning up the illegal gambling market.
He said: “The local government has begun to take enforcement against some (but not all) of the numerous illegal gaming venues in and around Vladivostok. This gives us some optimism as it relates to the outlook for mass and slots on a go-forward basis.”
