Operator News
Latin America – Uruguay helps drive Enjoy to year-on-year growth
By Phil - 25 May 2018
Leading Latin American gaming and resort company Enjoy has reported that revenues as of March 31, 2018 reached CLP$89,343m (USD 142m), representing a year on year increase of 3.6 per cent, mainly driven by its operations in Enjoy Punta del Este, Enjoy Coquimbo and Enjoy Santiago.
In its First Quarter Report Enjoy explained that the gaming segment of its business recorded an increase of 4.4 per cent, as a result of an increase in the net profit (win) of gaming tables and slot machines (7.6 per cent and 2.9 per cent respectively) year-on-year while the nongaming segment, related to hotels, restaurants and other services, registered growth of 0.7 per cent.
Adjusted EBITDA as of March 31, 2018 stood at CLP$22,986m (USD36.5m), an increase of 2.1 per cent compared to the same period of 2017. This is due to a higher adjusted EBITDA for Enjoy operations Punta del Este and Enjoy Pucón. The margin of this indicator during the first quarter contracted 26.1 per cent to 25.7 per cent registered as of March 31, 2018 due to the increase in administrative expenses associated with the extra costs of implementing a number of strategic initiatives.
In Uruguay, revenues in Chilean pesos increased 6.4 per cent year-on-year driven by the gaming segment, which recorded a WIN growth of 6.7 per cent year on year. In Chile, consolidated revenues increased 2.2 per cent year on year during the first quarter, mainly driven by Enjoy Santiago, Enjoy Coquimbo and, to a lesser extent, Enjoy Pucón. The Gaming segment registered an increase in revenues of 3.5 per cent due to an improved performance from Enjoy Rinconada, Enjoy Coquimbo and Enjoy Viña del Mar. Net WIN in Chile increased by 3.5 per cent due mainly to higher activity in its VIP rooms, which was up by as much as 27.0 per cent year on year being particularly high in Enjoy Santiago.
In April, the company set up the VIP Seven Stars category in Chile and Argentina – its most exclusive VIP category. Seven Stars was previously only available in Punta del Este. More than 120 customers have become members. According to the latest company report, Enjoy has also made a number of other significant investments in its gaming operations. During 2018, it plans to renovate 464 gaming machines with an investment of USD$8.9m. As of the end of March 174 new machines have been installed and the company has also invested in gaming technology particularly during the first quarter. It has also deepened the management of its client portfolio and behaviour analysis through data analysis tools with the support of several consultancies specialised in the optimisation of income of slot machines, through slot floor optimisation.
Overall, net income stood at CLP$94m compared to CLP$4,307m recorded in the same period last year, due to higher financial costs associated with the partial prepayment costs of its international bond and the total prepayment of its domestic bond. According to the report, the company’s efforts have been focused on refinancing liabilities, financing the purchase of Enjoy Punta del Este and making its operations more efficient.
In August 2017, US based private equity firm Advent International announced that it had signed an agreement with the Chilean operator. Under the terms of the new agreement, Enjoy will remain publicly traded while the founding family of Enjoy the Martinez family will retain a substantial equity ownership position in the company. Bonds issued by Enjoy increased by nearly as much as eight points on the back of the news. The capital increase will strengthen Enjoy’s capital structure, allowing for lower financial expenses, and enhanced investment capacity, including the renewal of Municipal Licenses. Chile’s antitrust regulator approved the move in October. In January it was reported that Advent has purchased 32 per cent of Enjoy for approximately US$120m.
Founded by the Martinez family in 1975, Enjoy is a leading gaming operator in Chile and Uruguay. The company owns and operates 10 casinos and 10 hotels in Chile, Uruguay, Argentina and Colombia, with 6, 824 slot machines, 367 gaming tables, 1,362 hotel rooms and 30 restaurants.
