NagaWorld, which owns, manages and operates Phnom Penh’s only integrated hotel-casino entertainment complex with a 51-year monopoly within a 200 km radius, reported GGR of US$237.4m during the first half of the year with profits of US$52.7m.
The operator stated: “Given the Group’s deep and resilient market with strong focus on the captive domestic market, the company remained profitable during the peak COVID-19 period during the financial year ended 31 December 2020 till 1H2022 and is one of only a handful of integrated resorts in the Asia Pacific region to report a cumulative positive net profit for the said period.”
During the period, the Group recorded EBITDA of US$130.1m and net profit of US$52.7m. The net profit of the Group increased sequentially Quarter on Quarter by 39.4 per cent on the back of higher Mass Market and Premium Mass Market revenues with stable costs. Both net gaming revenue and gross profit increased by 9.2 per cent and 10 per cent respectively compared to the three months ended 31 March 2022. Despite increased business volumes, the administrative and other operating expenses of the company remained stable resulting in higher profitability margins. EBITDA also grew sequentially by 13.2 per cent QoQ.
NagaWorld continued to see sequential quarterly growth in business recovery for 2Q2022 compared to 1Q2022 across all business segments especially in the Mass Market, Premium Mass and Referral VIP. The average daily business volumes for Mass Market and Premium Mass segments grew by 15.9 per cent and 14.5 per cent sequentially QoQ to US$9.69m and US$8.63m in 2Q2022 respectively.
The operator stated: “This demonstrates the depth, strength and resilience of the captive domestic market during the peak pandemic stage as well as its strong recovery during the present initial stage of recovery from the global pandemic. Referral VIP business volumes also improved significantly where average daily rollings increased by 98.5 per cent on a sequential basis to US$3.91m in 2Q2022 as the number of the international direct flights to Phnom Penh continues to recover. The average daily business volumes for Mass Market and Premium Mass segments in 2Q2022 have already recovered by 80.3 per cent and 71.8 per cent respectively compared to FY2019 (peak pre-COVID-19 year). Both the average daily business volumes for Mass Market and Premium Mass segments in 2Q2022 also achieved the highest levels since the first quarter of 2020.”
The widespread effects of COVID-19 have brought unprecedented challenges and uncertainties to the global market. However, the extensive vaccination coverage against COVID-19 has enabled Cambodia to reopen borders for all socio-economic activities and tourism, leading to positive economic prospects in 2022 and 2023.
According to the Ministry of Economy and Finance, Cambodia’s economic growth is projected to reach 5.6 per cent in 2022, underpinned by impressive high vaccination rates that rank among the best globally.
The Group continues to focus on the execution of its existing development projects. The development of Naga 3 is in progress. It is expected that the combined complex of NagaWorld (Naga 1, Naga 2 and Naga 3) will have approximately 5,000 hotel rooms, 1,300 gaming tables and 4,500 EGM and many other non-gaming attractions.
Approximately 93 per cent of Naga 3’s gross floor area will feature non-gaming offerings, which is in line with the Group’s long term strategy of offering comprehensive lifestyle products and services. Naga 3’s long term strategy is the continuation of Naga 2’s success. The Company is committed to developing and completing the Naga 3 project
to stimulate and enhance Cambodia’s tourism industry. Given the uniqueness of its casino monopoly in the heart of a capital city, the combined complex of NagaWorld is expected to position the Group as one of the most sizable riverine integrated resorts and entertainment centres in the Asia Pacific region.
The operator concluded: “Looking forward to the second half of 2022, the market outlook is relatively positive with the full restoration of socio-economic activity supported by high vaccination rates. Following the reopening of ASEAN and global travel restrictions, the outlook for international tourism continues to improve and the Group remains optimistic on the near term prospects. NagaWorld will continue drawing tourists to Cambodia, especially from ASEAN and believes that the long term business prospects and outlook of the Group will remain stable.”