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Cambodia – VIP outpaces mass as NagaWorld records revenue growth of 85 per cent

By - 19 March 2018

A spectacular year last year saw NagaWorld, located in the Cambodian capital city of Phnom Penh, continue to achieve impressive GGR growth of 85 per cent with VIP gaming surging past mass as the main source of income.

VIP now accounts for with 65 per cent of the resort’s GGR compared to just 42 per cent last year. Net profit for the year increased by 39 per cent to US$255.2m.

NagaCorp, the operator behind the venue, said that the positive results were mainly attributable to robust business volume growth across all segments, especially from the VIP segment where rollings increased by 142 per cent. It currently operates 384 gaming tables and 2,250 EGMs.

Timothy Patrick McNally Chairman of NagaCorp, said: “Our growth and positive results were attributed to a combination of solid business strategy and acumen, operational and execution efficiency, and an increasingly vibrant tourism market in a politically stable country, leading to an increase in business volume across all segments of the gaming business. Today we operate the largest integrated leisure and gaming entertainment destination in the Mekong Region.”
In the Mass Market segment, Public Floor Tables buy-ins and electronic gaming machines bills-in increased by 28 per cent and 21 per cent, respectively.

“This business volume growth is attributable to the improved headcount at NagaWorld as a result of visitation and tourism growth into Cambodia, particularly from China, which recorded 46 per cent growth in 2017,” Mr. McNally explained. “The Golden Edge Rewards Club loyalty program continues to enable the Group to understand its players’ profile, create targeted marketing promotions and rollout player development initiatives to increase the frequency of visitation and gaming spend. The Group’s VIP Market comprises players brought in by junkets, who are either under a commission or incentive program, and direct players without an intermediary. The competitive overseas junket incentive program introduced in March 2013 continues to enable the Group to balance the increase in table limits while managing volatility and credit risk.”

The VIP Market continued to register robust growth, as a result of increasing market confidence in NagaWorld as an integrated gaming and entertainment destination, resulting in a 142 per cent increase in rollings to US$21.1bn with a win rate of three per cent. This has translated into a 177 per cent increase in VIP Market revenue to US$625.3mduring the Year. Located right next to NagaWorld, NagaCity Walk offers duty-free shopping operated by China Duty Free Group, the largest duty-free operator in China, as its anchor tenant.

China Duty Free Group has leased about 3,800 square metres in the NagaCity Walk to operate dutyfree shopping which opened in August 2016. The opening of the TSCLK Complex (also known as Naga2) in November 2017 which significantly increased the variety, quality and quantity of NagaWorld’s gaming (VIP halls and suites and mass gaming halls) and non-gaming (karaoke, spas, clubs, restaurants, hotel rooms and suites) facilities, has enhanced the Group’s ability to expand its business across the region as reflected in the growth in VIP rollings.

Mr. McNally added: “The opening of Naga2 in November 2017 provided a transformational product for the Group. Naga2 significantly increases the quality and range of VIP, Mass Gaming and Non-Gaming offerings, providing the Group with a product comparable in quality to integrated resorts in more established gaming destinations. Naga2 more than doubles capacity in terms of hotel rooms and gaming facilities. It also adds a state of the art 2,200 seat theatre and additional entertainment, food and beverage options alongside the NagaCity Walk duty-free shopping mall which opened in August 2016. Its opening has removed many of the constraints previously faced by the Group in the development of new markets and deeper penetration of its existing markets.”

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