AGBriefings November 2017

Jurisdiction Updates November 2017 Edition

In focus pg.26

Homegrown talent goes global Macau

High rollers bounce back pg.6

Philippines Market loses lustre pg.10

JAPAN

Political hiccups pg.22

Korea

China row casts clouds pg.20

MGS 2017 SUPPLIER SPECIALS pg.38

MESSAGE 3

Made in Macau

T

he “Made in Macau” tag has rarely been more

operations, improved visitation with China on the back

than a gimmick when it comes to the local gaming

of warming ties with Beijing and continued support

industry. Apart from a few honorable exceptions,

from the local market are all supporting an argument for

the lion’s share of the supply business to the

further growth.

concessionaires - from equipment, to fixtures - has found

South Korea, touted as one of Asia’s most promising

its way onto the books of international companies. In this

markets, due to its proximity to China and Japan and

edition of AGBriefings, we dedicate our Focus to those

cultural appeal, had another disappointing year in 2017,

trying to reverse that trend, bringing you a story of success

this time due to politics - with the mainland calling its

and a call for a change of policy.

bargaining chip and cutting the country off in retaliation

Within these pages we profile Asia Pioneer Entertainment,

for its choice of military alliances.

which this month joins just a handful of homegrown Macau

Across the straits, the casino charge hit a political wall:

gaming names to list on the Hong Kong Stock Exchange.

all systems were a go in Japan at the beginning of 2017,

We hear how it’s banking on strong scope for growth, both

with global operators and cities stepping up to snare an IR

locally and around Southeast Asia, to draw in investors.

license, but Prime Minister Shinzo Abe’s snap elections

Keeping with our local theme, AGB spoke with Jay Chun,

seem to have stalled work on the crucial bill that details

chairman of the Macau Gaming Equipment Manufacturers

how the industry will be regulated.

Association, who told us that he would like to see a shift

We dedicate this edition’s Supplier Special Report to the

in government policy to allow local talent to be truly

MGS Entertainment Show, returning to the Venetian Macao

nurtured and developed.

this month with the support of the Macau Government

For this issue’s Jurisdiction Updates, the AGB Editorial

and over 150 gaming and entertainment companies. In this

Team has undertaken a year-end round up, looking at

fifth edition, the event promises to focus on innovations

the most significant changes that have come to pass,

that will shape the future “smart city”, featuring a number

and some still brewing around the region in 2017. Asia’s

of leading technology companies, including humanoid

multi-billion dollar industry enjoyed a solid year, but a

robot manufacturer Qihan, cloud computing giant Alibaba

few key events showed an alarming lack of preparedness

Cloud and video surveillance company Hikvision.

among operators -- the deadly attacks in Manila and Las

Drop us a line at MGS@agbrief.com to book a meeting. You

Vegas and Typhoon Hato in Macau.

are also welcome to drop by booth #AB32 to meet the AGB

In Macau, the market staged a stellar recovery to lead

team and discuss how we may help you to navigate your

gross gambling revenue growth throughout 2017, with the

business across 22 regional jurisdictions, through content,

high rollers flooding back to the tables. The Macau story

events and networking.

Rosalind Wade

Luis Pereira

is sexy again, albeit not because of the massive spin to Connect with us:

mass from VIP - pun intended. Nonetheless, the Macau government keeps pushing hard to turn the gambling hub

@agbrief

into a more family-oriented leisure destination - with mild success at best.

Asia Gaming Brief

Almost at the other end of the spectrum, the Philippine gambling industry started strong in 2017 but a series of

Asia Gaming Brief

On behalf of Asia Gaming Brief

setbacks have put the market on track for a lacklustre

Rosalind Wade & Luis Pereira

12-month performance. However, an increase in junket

Publishers

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NOVEMBER 2017 EDITION Series II • Issue XIX

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Asia Gaming Briefings | November 2017

CONTENTS 4

GREATER CHINA

INDOCHINA

SOUTH EAST ASIA

06

MACAU

PHILIPPINES

10

VIETNAM

16

MALAYSIA

12

CAMBODIA

18

SINGAPORE

14

SOUTH ASIA

NORTH ASIA

AUSTRALASIA

SOUTH KOREA

20

INDIA

30

AUSTRALIA

34

JAPAN

22

NEPAL

32

CNMI

36

RUSSIA

24

special focus

26

Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT

38

LAST WORD

58

LAUNCHING OUR NEW MULTI-DENOMINATION LINK

CONTACT YOUR SG GAMING SALES REPRESENTATIVE NOW MACAU OFFICE Phone: +853 2872 2539 www.sggaming.com/asia

6

GREATER CHINA

6

MACAU

VIP bounces back Macau’s government has been pushing hard to turn the gambling hub into a more family-oriented leisure destination, though in 2017 it was the VIP sector that staged a stellar recovery to lead gross gambling revenue growth throughout the year.

Asia Gaming Briefings | November 2017

T

he mass market was the first to return to growth in the latter months of 2016 after a near threeyear decline, but the sustained performance of VIP this year has taken many observers by surprise. After strong growth in the first quarter, many had predicted a slowdown in the second half as year-onyear comparisons became less favourable.

However, according to data from the Gaming Inspection and Coordination Bureau (DICJ), there was a 35 percent surge in revenue from VIP baccarat in Q3 to MOP38.7 billion ($4.8 billion), making up almost 58 percent of all gaming revenue in the period.

Mass drags In comparison, the mass sector posted single-digit growth of 7.4 percent to $28.3 billion. The number of gaming tables grew from 6,304 to 6,449, while the number of slot machines rose from 15,769 to 16,310.

The weaker mass numbers in Q3 relate in part to the impact of Typhoon Hato, which caused widespread devastation in August and which had a greater impact on mass-focused tour groups than the VIP market. However, it also demonstrates that Macau and its luxury resorts are still slanted towards high spenders.

GREATER CHINA 7

Although analysts expect that will eventually change with the improvements in regional infrastructure and the addition of new hotels rooms as the neighbouring island of Hengqin is built out, the 2017 performance shows it’s not there yet.

The government’s tourism master plan for the next 15 years, released in September, targets a doubling in non-gaming spending to between $12 to $14 billion, with visitor arrivals to hit between 38 million and 40 million.

Hotel supply is expected to increase 37.9 percent from 2016 to 2025, reaching 51,900.

Typhoon Hato, which killed ten people, also highlighted the sorry state of Macau’s existing infrastructure despite its position in the top five globally in terms of gross domestic product per capita. The category 10 storm left more than half of the population without power and many without water for days as the main water supply facility was flooded.

Operators rallied to help the local community with pledges of financial support and physical assistance to clean up the mess, while People’s Liberation Army soldiers left their barracks for the first time since the handover to join the recovery efforts.

Legislators are now facing pressure to improve facilities and push forward with long-delayed infrastructure plans.

After a series of new IR openings over the past few years, it now appears 2017 will not see any major development open its doors, with two projects delayed until next year. MGM China was scheduled to debut its jewellry box-styled resort in Q4, though pushed that back until January next year due to widespread damage to the site caused by Hato.

Budget boost MGM also announced an increase in project costs from HK$26 billion to approximately HK$27 billion (US$3.3 billion), excluding land and capitalized interest. Morgan Stanley revised down its 2017-19 EBITDA estimates for the operator by about 2-4 percent as a result of the delay to the project, which will double MGM’s capacity in Macau.

Luxury property, The 13 Holdings, which will be one of the world’s most expensive resorts, missed a July opening date and now says it’s pushing for early next year. The company is seeking to raise around HK$1.7 billion (US$217.8 million) through a rights issue and a placing of loan notes to fund the development and is now targeting March for its debut.

The last of the mega projects planned for Cotai -- that of SJM Holdings -- has been hit by multiple problems. The death of a

Asia Gaming Briefings | November 2017

GREATER CHINA 8

construction worker on the site triggered a six-week suspension of operations to upgrade safety, while a series of fires have made delays to the opening inevitable. The Lisboa Palace was targeting 2018 to be up and running, though analysts say 2019 is now more likely.

The only significant development to begin operations in 2017 was that of Macau Legend’s Legend Palace casino hotel at the revamped Fisherman’s Wharf in February.

The property was granted 15 new mass market gaming tables and has 223 hotel rooms.

The other major story this year among Macau’s operators was the dissolution of the Melco Crown Entertainment joint venture, with Crown Resorts selling out its share to Melco to focus on its domestic operations.

The partnership had been seen as one of the most successful in the industry, giving rise to the City of Dreams Macau and Manila and the Studio City resort.

Melco has subsequently renamed to Melco Resorts and Entertainment and surprised the market in August with the announcement it plans an initial public offering for Studio City, which it owns in a venture with a minority partner. Most observers were sceptical about the plan and say it’s more likely that Melco will buy out New Cotai Holdings.

When it comes to regulatory developments in Macau, the government is still keeping the industry guessing about the fast looming deadline for the renewal of the operators’ concessions. SJM’s and MGM’s concessions are set to expire in 2020, while Wynn Macau, Galaxy Entertainment, Melco’s and Sands China’s licenses are set to expire in 2022.

The government has made it clear that the process won’t be a straightforward rollover of existing contracts, though it has not clarified what kind of additional terms or conditions the companies may face. The existing operators are not expected to lose their licenses, though most analysts are expecting some kind of additional cost.

In a July statement, the government said it would study “all feasible directions,” including a review of whether any related laws regarding gaming concessions ought to be amended.

China’s ongoing efforts to combat capital outflows have also been felt in Macau. New verification requirements were introduced at ATMs for holders of China-issued Unionpay cards, including facial recognition.

The measures were put in place to prevent people from misusing the cards, though the gaming industry has said it has not noted a significant impact.

Asia Gaming Briefings | November 2017

GROSS GAMING REVENUE GGR 2016 MOP 223.21

-3.3%

GGR 2017E

+17%

Q3 GGR MOP 67b

+22%

Mass

+12%

Q3 VIP MOP 38.69b

+35%

VIP

+22%

Q3 Mass MOP 28.32b

+7.4%

GGR 2018E

(Source: DICJ)

+6% (Source: Bernstein)

Operators beef up security measures Macau’s gaming regulator and the Judiciary Police are ensuring the six operators comply with measures to beef up security at the casinos. The head of the Gaming Inspection and Coordination Bureau (DICJ), Paulo Martins Chan, said that the concessionaires are continuing to adopt security measures, such as the installation of metal detectors in arches of casino entrances, and until their completion portable metal detectors would be used. Special training for frontline workers - including intensive physical training, crisis management and identification of suspicious persons - is also being carried out by the concessionaires, while in some properties the number of security personnel is being increased.

Lawmaker buys Hotel Lan Kwai Fong Former Macau lawmaker Chan Meng Kam was identified as the buyer of the group which owns and operates Hotel Lan Kwai Fong in Macau, according seller China Star Entertainment. Hotel Lan Kwai Fong includes a total of 209 guest rooms, a casino situated on the ground, first and 18th floors, restaurants, a flower shop, retail shops and a spa centre. Chan reportedly acquired the hotel and residential units for HK$2 billion (US$256.1 million), with HK$200 million paid in cash as non-refundable deposit, and the remaining HK$1.8 billion to be paid upon completion.

GREATER CHINA 9

LT I N T E L L I G E N T

BOOTH #AJ18

Asia Gaming Briefings | November 2017

SOUTH EAST ASIA

10

PHILIPPINES

RWM attack, unrest take sheen off GGR The year started strongly for the Philippine gambling industry, but a series of setbacks have put the market on track for a lacklustre performance in 2017.

T

he year was marred by an attack on Resorts World Manila (RWM) in June, which killed 37 people, while ongoing regulatory and political uncertainty is also casting a shadow over the country’s potential. Hardline President Rodrigo Duterte has continued with his crackdown on drug dealers despite international condemnation, while he has also been locked in a bloody battle against Islamic State militants and communist insurgents in the south.

The negative headlines only serve to reinforce a perception that the Philippines is not a safe travel destination, which the industry has been trying hard to overcome. Philippine Amusement and Gaming Corp. head Andrea Domingo in August said the regulator now expects gross gambling revenue for this year of just P150 billion, virtually unchanged from 2016, against earlier forecasts for about P160 billion and acknowledged that the RWM incident had hurt prospects.

Despite it all, the country’s casinos, led by Entertainment City, posted strong figures for the first half of the year and growth is expected to pick up again in the fourth quarter, after a lull in the three months through to September.

Morgan Stanley expects the market to hit $5 billion by 2020, overtaking Singapore.

Casinos in Manila’s Entertainment hub have been ramping up their operations, while the third and largest -- Okada Manila -- is fast picking up pace. An increase in junket operations, improved visitation with China on the back of warming ties with Beijing and continued support from the local market are all supporting further growth.

Roll out ramps up The $2.4 billion Okada Manila, which is operated by Universal Entertainment unit, Tiger Resorts & Entertainment, held the soft opening for its casino in December, while the hotel and other attractions began rolling out from March.

It joins Melco Resorts & Entertainment’s City of Dreams Manila and Bloomberry Resorts’ Solaire Resort and Casino in the gaming hub, which now accounts for the bulk of gaming revenue in the Philippines.

Its opening wasn’t without its dramas, with multiple delays and setbacks, culminating in June with the removal of Kazuo Okada as chairman from the board of Tiger. The Japanese billionaire was accused of misappropriating funds at parent company, Universal in Japan.

Domingo told participants at the Asean Gaming Summit in Manila in March that the

SOUTH EAST ASIA 11

regulator won’t issue any more casino licenses for Entertainment City for the next five years to prevent excess competition from harming the pioneer investors. However, Pagcor is still keen to develop gaming clusters in regional areas of the country.

Several new projects outside of Manila were announced during the year, including Millennium Pan-Asia Hotel and Resort’s planned development of a $300 million integrated resort in Mandaue on Cebu and The Udenna Group’s $300 million Lapu-Lapu Leisure Mactan integrated resort. Pagcor itself also confirmed it will be moving ahead with the privatization of its own casinos, with that process now likely to begin next year, providing what may be an interesting entry point to the Philippines for investors.

Regulatory ups and downs On the regulatory front it has been one step forward and two steps back. In July, Duterte signed an amendment to the country’s money laundering regulations to cover casinos for the first time, closing a loophole that was thrown into the spotlight when money stolen from Bangladesh’s central bank found its way into Entertainment City’s gaming floors. As a result of the amendment, the Asia/Pacific Group on money laundering removed the Philippines from a watch list of AML offenders.

Duterte also signed a nationwide ban on smoking, which took effect in July. However,

GROSS GAMING REVENUE Pagcor GGR 2016 2017E

17Q2E P 39.1b

P149b P150b

+6%

the ban does allow for smoking areas within casinos, which so far have not reported major issues with the legislation.

Most of the regulatory concerns during the year have been focused on the online sphere, which has been shaken up since Duterte took power in 2016. He has vowed to crackdown on any companies offering services to Philippine nationals and to ensure the industry is properly regulated and taxed. To achieve this end, Pagcor has begun issuing Philippine Offshore Gambling Operator licenses, known as POGOs and its web site lists about 50 companies now falling under its regulatory control. It has said it will limit the number of licenses available, although the permits have proved a lucrative source of income, generating about $60 million in the first five months of the year, according to local media.

First Cagayan, which was the first licensor for online gaming in the Philippines, has seen its licensees leave in droves, with only about 48 now listed on its website, compared with about 138 companies last year. Many have swapped to POGOs, although some have left the country entirely.

On a brighter note, e-gaming cafe company PhilWeb corp, which was shut down in 2016, looks set to resume operations under the new leadership of Gregorio Araneta III. The company, which provides e-gaming software to Pagcor listed cafes, expects to regain full accreditation in the fourth quarter and to resume operations next year. PhilWeb has also been on a buying spree of e-cafes around the country.

Tiger “unaware” of listing plan Tiger, Leisure and Entertainment says it’s unaware of talks to acquire holding firm Bright Kindle Resources and Investments for the purpose of a backdoor listing. The comments followed a local news report that the group had looked at three publicly listed companies to take over in preparation of the backdoor-listing, with BKR emerging as the favorite. The acquisition of the holding company would only be the first step. Actual infusion of the gaming business into the listing vehicle could take about two years, said a source.

PCSO loses out to illegal operators The Philippine Charity Sweepstakes Office has vowed to clamp down on illegal gambling after discovering that it is losing almost a third of its revenue in its small-town lottery business to illegal operations. The PCSO earns P1.1 billion ($21.4 million) monthly from its STL operation, a PCSO lottery game intended to counter the popularity of jueteng, an illegal-numbers game in the Luzon area. That figure would be 30 percent higher were it not for the illegal operations, local media reports.

The STL was initially launched in 2005, but has now been expanded to cover 75 operators nationwide. The PCSO allocates 30 percent of income from lottery games to charity.

Asia Gaming Briefings | November 2017

SOUTH EAST ASIA 12

MALAYSIA

Resorts World makeover continues; police crackdown on illegal ops As Genting Malaysia ramped up the rollout of new integrated resort facilities this year, authorities in the rest of the country were hard at work clamping down on illegal gambling.

T

he operator is carrying out an MYR10 billion ($2.3 billion) revamp of its flagship property, Resorts World Genting in the Genting Highlands. It’s the only place in Malaysia where gambling is legal, apart from lotteries and horse racing.

The upgrade involves new casino floor space, additional shopping and restaurant facilities and the crowning glory, a planned theme part with 20th Century Fox. The plan is designed to help drive visitation to Resorts World Genting to 30 million by 2020 from 19 million in 2015.

Asia Gaming Briefings | November 2017

The key crowd puller is expected to be the theme park, though the attraction has faced ongoing delays and is now not expected to open until the second quarter of next year.

Still, this year, Genting opened the first and second floors of a forest-themed casino catering for the mass market in March, while the VIP-dedicated third and fourth floors were slated to open in the third quarter. The company has said the space is big enough to accommodate two 747 planes.

It also rolled out its Highlands Premium Outlet together with other new attractions in the Sky Plaza.

For Q2, Genting Malaysia reported a 59.4 percent year-on-year drop in profit due to higher depreciation and amortization from Malaysian operations. However, it said revenue rose 7 percent, getting a significant boost from the SkyPlaza offerings. The property also saw visitation growth of 8 percent in the quarter.

Progress at home, from where it gets more than two-thirds of its profits, has been counterbalanced by setbacks in its overseas operations. The company has faced issues in the U.S. over an investment to manage the First Light Casino & Resort in Taunton,

SOUTH EAST ASIA 13

Massachusetts for the Mashpee Wampanoag (WM) Tribal Gaming Authority, which is now in doubt due to a challenge over land-use.

It also failed in a bid to secure a key casino license in Canada, missing out to Great Canadian Gaming Corp. and Brookfield Business Partners LP for the opportunity to run properties in the Greater Toronto Area.

However, on a brighter note, it appears a long-stalled project to construct Resorts World Las Vegas in the U.S. may be finally moving ahead. The company reportedly hired construction manager W.A. Richardson Builders, LLC (WARB), with the Clark County Building Department approving multiple permits and applications for the project.

Elsewhere in Malaysia, 2017 has seen a concerted effort by authorities across the country to stamp out illegal gambling, which is widespread both off and online.

After ongoing raids throughout the year, authorities in September declared all out war, setting up a special task force to combat the problem.

The illegal gambling action committee will combat both online gambling, which is becoming increasingly widespread, as well as the illegal gambling dens. However, videos surfaced in October showing police, including vice-squad members, partying with a known gambling kingpin, highlighting the uphill battle authorities face in overcoming the problem.

Police efforts will be coordinated with the Malaysian Communications and Multimedia Commission as well as internet service providers, while the committee also plans to seek amendments to the country’s antiquated gaming law to close loopholes that hinder police in their investigations.

Persistent raids in the Western state of Penang are apparently paying dividends on regional dens, according to CID Chief Senior Asst Comm Zainol Samah.

“We have four to five teams out every day to conduct raids and check on centres that are suspected of being involved in these activities. We also have round-the-clock monitoring on the 224 licensed family entertainment outlets in the state as some may have misused their licence to conduct gambling activities,” he told local media.

However, authorities in Sarawak state on the island of Borneo, have conceded they are having huge difficulties in stamping out illicit activities, with improvements in telecommunications making it increasingly easy to organize gaming online, even in the state’s highly remote jungle locations.

GROUP CORPORATE STRUCTURE

Leisure and Hospitality

Malaysia

United States and the Bahamas

Property

United Kingdom

100% First World Hotels & Resorts

100% Genting New York

100% Genting UK Plc

100% Oakwood

100% Genting Golf Course

100% Resorts World Omni

100% Genting Solihull Limited

100% Resorts World Miami

100% Widuri Pelangi

78% BB Entertainment

78% Genting Alderney Limited

100% Genting Properties (UK) Pte

100% Papago

(Source: Genting Malaysia Berhad)

Genting exits The Star Genting Group has sold its 5.6 percent stake in Australian casino operator The Star Entertainment Group for A$235.2 million ($181.9 million) to raise funds for working capital and investment opportunities should they arise. Genting said it sold 46.4 million shares in The Star at A$5.07 in a block trade, giving it a net gain of $67.5 million on its investment. Australian media reported that financial services group Perpetual teamed with two other players to buy the stake. Genting, through its Singapore unit, is seeking a license in Japan and recently set up an office there.

Gaming tax to stay put The Malaysian government is unlikely to increase gaming taxes for casino and lottery businesses, AmBank group chief economist Anthony Dass said in a preview of the 2018 budget. He said he believe’s Genting had scored goodwill with its ambitious investment plans in its Resorts World Genting IR. Meanwhile, foreigners in Malaysia will pay a room tax rate of RM10 $2.30 a night and locals will be exempt under new rules that came into effect in August. The proposed changes had initially included Malaysians and were on a sliding scale, with the top rate double its current level, raising concern it would deter visitation.

Asia Gaming Briefings | November 2017

SOUTH EAST ASIA 14

SINGAPORE

Shopping trumps gaming Singapore’s tourism industry has shown continued growth in 2017, building on from a record year in 2016, though the figures still suggest that the bulk of the money being brought into the island state is not finding its way onto the casino floors.

I

n the seven months through to the end of July visitor numbers increased 3.8 percent, on track to meet the top end of the Singapore Tourism Board’s (STB’s) projections for this year of between 1 percent and 4 percent growth. China arrivals were up 6.6 percent to July, posting a strong start, but trailing off in the following months.

In Q1, the only period so far this year with a detailed breakdown, tourism spend rose 15 percent to S$6.4 billion ($4.7 billion), outpacing a 4 percent rise in arrivals to 4.3 million.

In that period, Chinese travellers emerged as both the biggest spenders and leading source of visitors, chalking up double-digit growth in tourism receipts and arrivals.

The STB reported gains in all areas of tourism spending except sightseeing, entertainment and gaming. Spend on shopping, for example, shot up 38 percent to S$1.6 billion, while the spend on sightseeing, entertainment and gaming was flat at S$1.08 billion.

Brighter prospects Despite the lacklustre statistics, Singapore’s two gaming operators reported an improvement in Q2 results as a series of measures to get costs under control and to cut back on bad debt fed through to the bottom line.

Genting Singapore’s Resorts World Sentosa was the standout performer, beating most analysts’ expectations. It has been lagging Las Vegas Sands unit, Marina Bay Sands, as it struggled with bad debts from its VIP players, mostly from China.

However, efforts to tighten its policies on credit provision and a marketing push towards the premium mass sector appear to be paying off.

Asia Gaming Briefings | November 2017

GROSS GAMING REVENUE Genting Casino Revenue 2015

SG$1.74b (US$1.28b) $2.31b

2016

The group achieved revenue growth for three sequential quarters. Overall revenue rose 24 percent to $596.1 million, helped by a higher rolling win percentage in the premium player business. Adjusted EBITDA soared 152 percent to $292.7 million.

At Marina Bay Sands revenue rose 17.7 percent to $836 million and adjusted property EBITDA was up 37.8 percent to $492 million.

Morgan Stanley notes that the reported property EBITDA was the second-best since opening in 2010, though was mostly driven by luck as the mass market did not grow.

Fitch Ratings has said it expects overall GGR for this year to be flat at about US$4 billion.

Analysts see few catalysts to spur significant casino revenue growth in Singapore, though the two operators have been pushing hard to add and diversify non-gaming attractions to bring in more clientele.

Resorts World Sentosa has been focusing on the gourmet food and lifestyle theme, hosting a pop-up street food event in August and a festival of gastronomy in September. One of Belgium’s rising culinary stars, Chef Alexandre Dionisio from the Two Michelin-starred La Villa in the Sky, was brought in to host an event in October.

Marina Bay Sands recently unveiled a premium afternoon tea venue, Renku, and has ramped up the star power by hosting Bollywood and K-Pop stars.

Las Vegas Sand Chairman and CEO Sheldon Adelson earlier this year said he may consider selling a 49 percent stake in the company’s Singapore luxury mall, the Shoppes, to raise funds to finance expansion plans elsewhere, notably Japan. Analysts expect the stake to raise as much as U$3.5 billion if it goes ahead.

Marina Bay Sands Casino Revenue

$1.58b ($1.16b) $2.16b

2017E

US$4b (Source: Fitch)

Police arrest 58 in illegal gambling bust Singapore police arrested 58 suspects following a four-day multi-agency joint operation in September. According to a statement from the police, the operations were led by the Bedok Police Division and were supported by officers from from the Singapore Customs, Immigration and Checkpoints Authority, Central Narcotics Bureau, Criminal Investigation Department and Health Sciences Authority. Forty-five men and three women were arrested under the Common Gaming Houses Act, while two women were arrested for vicerelated offences.

Genting liquidates S.Korea unit Genting Singapore has dissolved and liquidated its subsidiary in Korea, Claremont Co. Ltd. The subsidiary was first set up in August 2016, focused on the leisure and hospitality related business. It was placed under unit holder’s voluntary dissolution and liquidation in May of this year. According to a filing from Genting, the liquidation is not expected to have any material impact on earnings per share of the company for the financial year ending Dec 31 2017. Genting said it was pulling out of its planned venture in Jeju with Landing International to focus on a potential bid in Japan.

SOUTH EAST ASIA 15

Asia Gaming Briefings | November 2017

16

INDOCHINA

16

VIETNAM

Casino and sports betting bills inch towards inclusion of locals Vietnam’s casino industry took a giant step forward at the beginning of 2017, publishing new legislation that has been more than seven years in the making and opening a crack in the door for locals to gamble.

Asia Gaming Briefings | November 2017

A

t the time, there were predictions that with a solid legal framework in place, Vietnam would be among the top five Asian gambling destinations within five years. There has undoubtedly been interest from foreign investors, but by no means a flood as operators waited for the detailed regulations fleshing out the initial decree.

Professor Augustine Ha Ton Vinh says the circular containing the details has now been approved and will go into effect on Dec. 1.

The Casino Decree 03/2017 created excitement because it allow locals to gamble on a three-year pilot basis at a limited number of resorts, including the Van Don Special Economic Zone in the far north, which encompasses the World Heritage-listed Ha Long Bay and on Phu Quoc island in the south. The Phu Quoc island integrated resort is being readied to open around Tet, the lunar New Year here, in mid-February 2018. The Van Don international airport is scheduled to open sometime in March 2018 and the integrated resort by the end of 2019.

The Grand Ho Tram, Vietnam’s biggest IR, has also submitted an application and is currently the only property that meets the investment criteria, while Donaco International has also said it would like its Aristo International resort to play a part.

Capital reduction The new gaming decree stipulates the minimum capital required to set up at IR should be $2 billion, down from $4 billion set out in earlier versions of the bill. It also sets out the number of gaming machines and tables permitted per invested capital.

According to a report from Union Gaming earlier this year, Vietnam’s casinos and slot parlours are likely generating between $800 million and $1.2 billion in annual gross gambling revenue, based on figures extrapolated from the three listed casinos, though it concedes this estimate may be too conservative. At the moment, Vietnam has about 50 gaming facilities with more than 2,000 slots and almost 400 tables.

Casino giant, Las Vegas Sands confirmed during the year, it would still be interested in investing in Vietnam were the right opportunity to emerge. “We have been working continuously with the Vietnamese Government for many years, way before the decree was issued,” managing director for global development, George Tanasijevich, told the Vietnam Economic Times, adding the group was eyeing an IR in either Ho Chi Minh or Hanoi. As yet, the government

INDOCHINA 17

has shown no inclination to allow resorts in either of the country’s two main cities.

Hard Rock International is also moving ahead with plans for an IR at the Laguna Lang Co beach resort. The provincial committee of Thua Thien-Hue has asked the government’s permission to increase the investment capital of the project to US$2 billion, as well as to open a casino in the complex, Vietnam News reported.

The Lang Son integrated resort at the Vietnam-China border in the North, with a gaming license issued in 2004 for 100 tables, is being revived. The project, spanning more than 200 hectares, originally launched as a $5 billion mega project with an international convention and exposition center, a mega mall, a 36-hole golf course, 2 five-star hotels and a casino, and an upscale residential area, and has been dormant for 13 years. The project ownership is being negotiated and transferred from the Taiwanese owners to a Chinese investment company.

GROSS GAMING REVENUE GGRE $88m - $1.2b

(Source: Union Gaming)

CASINO DISTRIBUTION Cambodian Border Casinos

Integrated Resorts

Small Casinos China

Hanoi

Laos

Thailand

Junket action Aside from LVS and Hard Rock, much of the interest this year has been from junket investors keen to enter the market.

Macau’s Suncity Group Holdings has been particularly active. Through a local unit, the company is buying a 34 percent stake in an integrated resort project in Hoi An South for an aggregate consideration of HK$600 million ($76.8 million).

The $4 billion property is being developed jointly with Hong Kong’s Chow Tai Fook Holdings and Vietnam’s VinaCapital Group. It covers an area of 985 hectares and is scheduled for completion by 2035.

The junket group also signed an accord to provide technical and consultancy services to an IR in Quang Ninh province in the Van Don Special Economic Zone.

The country’s largest IR, the Grand Ho Tram, also took steps to move to the next stage of development, launching the KAHUNA Ho Tram Strip condotel and villa project. The 244 key resort development is made up of 164 condotel units situated in a 12-storey tower, 36 double key villas and 8 beach front villas all for longterm lease. Investment costs range from VND 2 billion (US$88,800) for a one-bedroom unit to VND 20.5 million (US$900,000) for a villa.

While the casino decree and guidelines are now in place, the sports betting guideline, legalizing betting on international soccer, horse and greyhound racing, is being finalized. Phone betting was permitted, but no online gambling.

Cambodia Ho Chi Minh

Vietlott CEO steps down The chief executive officer of state-owned lottery company, Vietnam Lottery Co. Ltd. (Vietlott) resigned in October due to personal reasons, the Ministry of Finance says.

Tong Quoc Truong had been Vietlott’s CEO since the company’s foundation in August 2012. No further reason was given for his departure. His deputy Nguyen Thanh Dam was appointed as the acting CEO.

Suncity enters services accord for Quang Ninh IR Suncity Group Holdings has entered into a Technical Services Agreement with the developer of the integrated resort in the Quang Ninh Province. Suncity said the accord is the first step for the group to providing consultancy, advisory and technical services for large-scale resorts with gaming and entertainment facilities. It added that it will continue to expand its business scope in order to maximize returns for its shareholders. The opening date of the IR project is set for March 31, 2019.

Asia Gaming Briefings | November 2017

INDOCHINA 18

CAMBODIA

VIPs growth powers ahead, legislation lags Cambodia’s casino industry has seen another year of growth, helped

by VIPs from China and growing tourism, though operators are still waiting for the publication of new legislation governing the industry.

T

he long-awaited gaming bill was submitted to the country’s cabinet in September. It is expected to set out a new tax regime, as well as formalizing a system for licensing; regulation of junkets; accounting and reporting procedures; greater disclosures and anti money laundering rules.

Ros Phearun, deputy director-general of the Finance Ministry’s financial industry department, told local media that the bill will help the government to manage the fast growing sector, but also to attract more large-scale foreign investment.

Operators have said the bill may spark a shake out of the country’s casinos, many of which are small and clustered along the borders to cater to either Vietnamese or Thai customers, who are banned from gambling at home.

There is expected to be a minimum investment requirement of between $50 million to $100 million over ten years and this requirement, if confirmed, is likely to slash the number of casinos in the country by about two thirds to just 20 or so properties, a leading operator warned.

At present, Cambodia has issued 79 casino licenses.

Tourism arrivals in 2017 have been strong, up 12 percent in the six months through to June, helped in particular by a 40 percent jump in visitation from China. The government is targeting two million China arrivals by 2020, a four-fold increase from current levels and in 2016 launched a China Ready policy to help foster trust between Cambodian businesses and Chinese visitors.

The program recognizes tourism establishments that have at least one Chinese speaking staff member and that have translated menus and web sites into Chinese.

Cambodia’s largest operator and the

Asia Gaming Briefings | November 2017

only one with a license to operate in the capital Phnom Penh has been a major beneficiary, reporting a 67 percent increase in VIP rollings in the nine months to end September to $11 billion. Mass table buy ins during the period were $566 million, up 24 percent, while electronic gaming machines bills in gained 16 percent to $1.3 billion.

Naga opened its Naga 2 complex on Nov. 2, which is expected to drive further visitation to the resort. The complex, which is adjacent to the original property, adds 300 more gaming tables, as well as 500 electronic gaming machines, as well as shopping and entertainment facilities.

Conversion concern During the year, the company’s founder and controlling shareholder, Tan Sr Dr. Chen Lip Keong, announced a plan to gain full control of the company through exercising bond conversion rights. Under the plan, his stake would rise to more than 60 percent, from just under 40 percent at present. The deal has been challenged by hedge fund, Nine Masts Capital, as being unfair to minority shareholders.

Elsewhere, Australia-listed Donaco International’s Star Vegas property in Poipet, has had a less stellar year. The company saw a dip in revenue of 6.8 percent to $87.5 million in the 2017 fiscal year, due to subdued consumer sentiment and a weak economy in Thailand, which has been marking the official mourning period for King Bhumibol Adulyadej, who died in October last year.

In July, the company assumed full management control, and has been revamping its marketing strategy and changing the junket mix to boost revenue.

Donaco bought Star Vegas in January 2015 for $360 million, although the Thai

vendor agreed to stay on for a further two years to manage the property, offering a guaranteed minimum of $60 million in EBITDA during the period.

It recently announced plans to add approximately 100 gaming tables and said it was making ‘good progress’ in regards to

INDOCHINA 19

GROSS GAMING REVENUE Naga 9-month VIP rollings $11b

+67%

Mass market buy-in $566.4m

+24%

EMG bills-in $1.31b

+16%

IMF predicts steady growth The International Monetary Fund has said the Cambodian economy is likely to grow 6.9 percent in 2017, slightly lower than the 7 percent recorded last year, fuelled by increased tourism, construction and garment exports. The IMF said it expects growth to remain robust in the next few years, though some economists have warned that renewed political uncertainty in the country make take its toll on growth.

Donaco plans buyback

marketing the property to a new group of international VIPs. During the year, it signed a deal with international marketing agency Vivo Tower Ltd. to attract junkets from Macau, Hong Kong and Malaysia. Vivo Tower has already engaged Malaysian junket operator, Da Kim

Global Group to bring in VIP customers starting from July 1.

Bavet City may also host a new resort.

According to local media, Virtue Resources is planning a $200 million project to be known as Empire World City, consisting of a casino, hotel & resort, as well as a Water Show Arena.

Donaco International is implementing an on-market buyback for a maximum of up to 41.5 million shares, representing a maximum of 5 percent of the total. Managing Director and CEO Joey Lim says the buyback will complement the company’s dividend policy. “Our primary focus in assessing all potential uses of the company’s cash holdings is to ensure a strong return for shareholders. Buying the company’s shares at recent prices represents an excellent opportunity to generate strong returns. He says the buyback, scheduled to start Oct. 30th, will help boost earnings per share and have no impact on operations.

Asia Gaming Briefings | November 2017

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20

SOUTH KOREA

China row casts clouds in Korea Once touted as one of Asia’s most promising markets, due to its proximity to China and Japan and cultural appeal, South Korea had another disappointing year in 2017, this time due to politics.

NORTH ASIA

R

21

The property will be restricted to foreigners evenue in the country’s foreigneronly casinos had only just recovered only, with only one casino in South Korea from an outbreak of Middle Eastern permitted to allow the entry of locals.

The company has dismissed concerns about Respiratory Syndrome in 2015 that triggered a slump in tourism. Prospects at the the tourism slump, saying the resort will pull in beginning of the year were looking up, but visitors from the Seoul region to the non-gaming then South Korea agreed to deploy the U.S. attractions, while the mainland VIP can visit.

Caesars Entertainment and the Mohegan terminal high air altitude defense (THAAD) Sun also have licenses to develop IRs in the system sparking Beijing’s ire.

Incheon area, though In retaliation, progress has been slow.

Beijing banned tourHong Kong-listed group travel to South The Hyatt will Lippo Group, which Korea from March, was part of the Caesars with a resulting operate 1,600 rooms, consortium completed collapse in tourism 11 restaurants and its pullout from the numbers. Individual project in March. tourists are still able bars, and all other Mohegan in to travel, but they hotel amenities. It May s a i d i t h a d were unable to make will be the world’s “executed important up for the large and agreements” with rapidly rising number second-largest Incheon International of China arrivals.

Hyatt hotel in terms Airport Corp (IIAC) The number of regarding necessary mainland visitors of room capacity. infrastructure around fell by more than the site, as well as a 48 percent in the development services eight months through August, according to figures from the Korea agreement with the scheme’s consortium under Tourism Organization. In the month of which it will receive $40 million a year. The August, alone China arrivals were down more project is slated to open in 2020.

The southern island of Jeju has also seen than 60 percent. Beijing finally signalled at the end of October that it may ease up on projects advance, with Landing International Development holding a soft open for the first the blockade.

Despite the setback, a number of projects part of its Shinhwa World complex in April. have progressed, including the opening of the Landing was originally developing the $2.2 billion resort with Genting Singapore, but country’s first integrated resort in April. the partner announced it was pulling out at the end of 2016, leaving the Chinese property Market debut developer to go it alone.

Landing opened The Shinhwa Theme Paradise City, a joint venture between Paradise Co. and Japan’s Sega Sammy Holdings Park, on Sept. 30, which was developed in Inc, opened in April. The project is located collaboration with TUBAn, one of Korea’s at the International Business Center (IBC-1 premier animation companies, based on its Phase 2) Area of Incheon International Airport, popular 3D animated characters such as Larva, and is around 40 minutes drive west of the Wingcle Bear, Buck, and Oscar. The IR will hold its grand opening in December, when country’s capital.

It holds a land area of around 330,000 the casino will come online.

The Gongzi Jeju Casino within the Ramada square meters, and opened with 154 game tables, 281 slot machines and 4 electronic table Hotel complex in Jeju held an official opening games (62 seats). The remaining facilities under in July, while another major project from Lotte the first phase, which will include commercial Tour Development Co is also moving forward. facilities and a premium spa are scheduled to It has selected Grand Hyatt as the hotel brand for its Jeju Dream Tower integrated resort in a be completed in 2018.

The company said that it forecasts roughly hotel agreement signed in August. The Hyatt 1.5 million annual visitors in the early years of will operate 1,600 rooms, 11 restaurants and the resort, with revenues for the group’s four bars, and all other hotel amenities. It will be casinos to reach 880 billion won in 2017 and the world’s second-largest Hyatt hotel in terms of room capacity.

1.1 trillion won in 2018.

“

”

GROSS GAMING REVENUE Annual Turnover

(hundred million won) Kangwon Land

Only for foreigners

17.000 16.000 15.000 14.000 13.000 12.000

2013

2014

2015

2016

(Source: National Gambling Control Commission)

N. Korea lifts racing ban as sanctions bite The North Korean government has lifted its ban on horse race betting. It is understood that race goers 12 or older were allowed to bet on jockeys through a lottery system at the end of the competition.

According to a report from Reuters, experts see the move as the latest method for the isolated country to ride out a series of international sanctions, which has placed bans on key exports such as coal, textiles and seafood. “Kim has been pushing for vanity projects for a theme park, sky resort and the horse riding club for the sake of propping up the people’s well-being but their real purpose was to earn foreign currency,” said Na Jeongwon, head of the North Korea IndustryEconomy Research Institute in Seoul.

Paradise Sept. sales gain Paradise Co posted 34.1 percent gain in revenue year-on-year in September, despite the plunging mainland tourist arrivals. Revenue was approximately KRW54.70 billion ($48.1 million), compared to about KRW40.78 billion in September of 2016. Table revenue rose 37.9 percent to nearly KRW52.09 billion, from nearly KRW37.77 billion in the prioryear. The group gave no explanation for the gain, though analysts have speculated it may be benefiting from efforts to broaden its clientele base. In the first half of the year, revenue tumbled 20 percent.

Asia Gaming Briefings | November 2017

NORTH ASIA 22

JAPAN

Casino charge hits political wall It was all systems go in Japan at the beginning of 2017, with global operators and cities stepping up their efforts to snare an IR license after a bill legalizing casinos was finally pushed through parliament in the final hours of the last session of the prior year.

H

owever, the path towards what is expected to be one of the most lucrative gambling markets in the world has never been smooth and the process has hit another stumbling block that may cause delays. Prime Minister Shinzo Abe, once again seeking an opportunity to shore up his support, called snap elections at the end of September, stalling work on a crucial bill setting out the details of how casinos will be regulated.

Although Abe won a resounding victory, political events have once again slowed the progress, although key officials have given

assurances that the IR implementation bill and separate legislation to tackle problem gambling will move forward as soon as possible.

The legislative delay doesn’t seem to have dampened the enthusiasm among international operators, who appear to be forging ahead with plans to tap the market, which CLSA estimates could hit annual gross gambling revenue of about $25 billion once fully mature, with a model of two urban IRs and 10 in smaller, regional cities.

MGM Resorts International has been among the most aggressive building out its Japan presence, with eight permanent staff

TOURISM ARRIVALS

Fitch more cautious on GGR potential

January

The Japanese gaming industry is expected to produce gross gaming revenues of $6-9 billion, depending on whether two or three integrated resorts are opened initially, according to Fitch Rating’s All in: Global Gaming Handbook. While other analysts and operators have placed Japan’s GGR estimates in the $20 billion range, Fitch says that these predictions fail to take into account “the limited footprint of the initial casinos relative to other jurisdictions that are more liberal in terms of gaming positions (e.g. U.S. and Macau).” “Given the likely physical restrictions, we do not think that estimates based on Japan’s GDP or loosely regulated pachinko industry are practical,” said the ratings agency.

February March April

2,006,775 1,791,122 1,898,944 2,300,476

May

2,020,226

June

2,117,253

July August September

2,426,074 2,477,500* 2,280,100*

*preliminary figures estimated by JNTO (Source: JNTO)

Survey highlights problem gambling levels Around 3.6 percent of the Japanese population have suffered from gambling addiction, according to a government survey released on Friday. The number amounts to around 3.2 million people nationwide, said The Japan Times in a report. The survey also shows that around 700,000 people, or 0.8 percent of the population, were addicted within the past year. Among them, pachinko accounted for the most money spent on gambling. Gambling addiction has become the centre of public debate in Japan over the last year, with many fingers pointed at the forthcoming establishment of IRs.

Asia Gaming Briefings | November 2017

in a new office in the Otemachi district of Tokyo and in its Osaka branch office. The U.S. company also recently launched a Japanese-language web site.

It and rival operator Las Vegas Sands have said they may be willing to invest as much as $10 billion if the conditions are right, and as long as locals are permitted to gamble.

Sands in its attempts to get ahead brought out the star power, holding events in Tokyo and Osaka, with international footballer David Beckham and Eagles guitarist Joe Walsh to convey the message that an LVS-run IR would be accompanied by top-level international

NORTH ASIA 23

talent in a variety of fields that would enrich the nation’s entertainment options.

Macau operator Galaxy Entertainment Group has teamed up with Monaco’s Societe de Bains de Mer to bring a dash of riviera glamour to its bid, while it has announced it will be working with the Japanese architect firm, Tange Associates, to ensure its design is appropriate for the market.

Melco Resorts & Entertainment is also forging ahead, appointing Ako Shiraogawa as the president of Melco Resorts & Entertainment Japan, and announcing the opening of two offices—one in Tokyo and the other in Osaka.

Caesars Entertainment, Genting Singapore and Hard Rock International are among the host of other international operators also raising the curtain on their plans should they win a license. Although most IRs are expected to be Japanese-led, or involve a local partner, potential entrants so far have kept their cards close to their chests.

Advertising giant Dentsu and Sega Sammy, which opened an IR in South Korea earlier this year with Paradise Co, have said they are

interested. And Universal Entertainment, the owner of the Okada Manila resort in the Philippines is also a candidate.

While the companies position their offerings, the cities and sites most likely to become hosts are also becoming clearer, as is the fact that many areas still face strong opposition from locals opposed to gambling.

Contending regions Among Japan’s smaller, regional governments, Tomakomai city in Hokkaido maintains a distinct lead over its peers in terms of the degree to which their engagement with IR operators and other related businesses has advanced. The deadline for their initial RFI process was reached on September 22, and they received a total of fifteen responses from various companies.

The Nagasaki prefectural government has also made a pitch, as has the city council of Iwanuma in Japan’s northern Miyagi Prefecture. The former has proposed that its existing Huis Ten Bosch theme park in Sasebo city become the base of a regional

IR, while the latter is seeking a resort as a way to rebuild the community after the devastating earthquake and tsunami in 2011.

Tokoname, in Aichi Prefecture, took its first steps toward a possible bid to locate an IR on Chubu Airport Island, though has faced strong opposition from the local communist party. While efforts by Yokohama to locate an IR at the city’s Yamashita Pier took a heavy blow when the Yokohama Harbor Transport Association declared its opposition to a casino. Among the larger locations, Osaka has been the most pro-active, although again, it is facing strong opposition.

Those working on drafting the actual legislation are acutely aware of how unpopular the idea of casinos remains among the Japanese people and some planned provisions designed to minimize potential harms have concerned operators, in particular provisions limiting casino floor space.

Sands head Sheldon Adelson warned such provisions if incorporated into the final legislation wouldn’t allow for the best kind of IR and would lead to lower investment levels.

Asia Gaming Briefings | November 2017

NORTH ASIA 24

RUSSIA

Russia seeks to speed Primorye growth Developments in Russia’s Primorye gaming zone, considered the most promising in the country, have inched ahead throughout the year, although the pace is not as fast as the central government had hoped.

F

rustrated with ongoing construction delays, The Russian Ministry for the Development of the Russian Far East decided to take the matter under federal control to streamline management of the project. The Far East Investment and Export Agency will now be tasked with bringing new large international players to the zone, which is close to the port of Vladivostok.

Its main selling point its proximity to northern Asia, at two hours by plane from Beijing, Tokyo and Seoul, giving it access to a population of about 400 million. According to a study by Ernst & Young, commissioned by the PKDC, the zone has the potential to generate $2.2 billion in GGR by 2025. Global Market Advisors has set a range between $2 billion and $7 billion.

International investors are already operating in the zone and 2017 saw most of them

Asia Gaming Briefings | November 2017

take a step forward with their development projects. To date, Summit Ascent, a unit of Melco International Development, has the only operating casino. Although the ramp up at the Tigre de Cristal has been slower than expected, due in part to competition from illegal gambling, business is now improving.

Expansion plans The company pointed to better transport links and a new visa scheme easing restrictions for foreign tourists. As a result, it said it is now reviewing designs for the $500 million second phase, which it will carry out with South Korea’s Kangwon Land. This phase is expected to open in the second half of 2019.

The project will also go forward under new management. Craig Ballantyne, chief operating officer of Summit Ascent Holdings announced

his departure to take on a new role at Melco International. Replacing him was acting chief operating officer, Stylianos Tsifetakis, who has more than 20 years of experience in the casino and hospitality industry.

Hong Kong-listed Nagacorp, which is building the biggest resort in the zone, also moved ahead, with builders in April beginning the second stage of excavation. The project, which was renamed as Naga Vladivostok is expected to be completed in early 2019, with actual construction beginning in November.

In June, Russian investor Diamond Fortune Holdings Prim also said construction was underway for its Selena World Resort and Casino, which may be completed ahead of schedule. “We got the necessary permits and started an active phase of work. The retaining walls are currently being constructed on the site. Everything is 95 percent ready for the

NORTH ASIA 25

GROSS GAMING REVENUE 2009 2020

$3.6b

$2.2b (Source: Ernst & Young)

GMA $2b - $7b

Crimea gaming zone ready for business

construction of a foundation ditch,” Evgenia Varakina, the company’s executive director said at the time.

The assurances that construction work is under way come amidst growing signs the company charged with developing the zone is running out of patience with delays. The Primorsky Krai Development Corporation this year terminated the contract awarded to Russia’s Royal Time Group after repeated delays to construction of its Phoenix IR. Auction revisions The development corporation has been in talks for three further development plots.

It initially sought to auction the plots for RUB400 (US$6.9 million), 600 and 900 million, which granted the right to lease land and put together agreements for the construction of hotels and entertainment casino complexes.

However, it failed to attract bids. It stressed this was not due to lack of interest, and said there have been talks with European, South Korea, Russian and Hong Kong investors, as well as those from China. The company was looking at amending land plot configurations and starting prices to seal a deal.

Shambala CEO Maxim Smolentsev is

reportedly interested in an investment in the zone and has put forward a project developed by international architectural firm AEDAS, which is behind gambling venues including The Venetian Macao and Marina Bay Sands in Singapore.

The entertainment complex is expected to include a casino and a 5-star hotel with no less than 250 rooms. Construction is expected to be carried out in two stages, the first of which involves building a casino within the two-year period. The second stage, which will take about three years, will include hotel and entertainment facilities. The overall investment is expected to be RUB10 billion (US$170 million). State media reported the project has been approved.

Elsewhere in Russia, Sobranie, the newest casino in the Yantarnaya gambling zone, opened in February. It was touted as “the biggest casino in Europe”, the casino occupies a total area of 18,000 square metres on the Baltic Sea coast and, as of now, includes 350 slot machines and 14 gaming tables. There are plans to increase their number to 1,000 and 40 respectively.

Total investment in the project totals RUB 2.5 billion (US$43.1 million) and is expected to reach up to RUB 3.5 billion.

Preparations for the creation of the Crimean gambling zone have been completed, according to the Crimean minister of economic development Andrei Melnikov. “All the preparatory work has been done by the republic, the documents have been submitted to the government of the Russian Federation for the adoption of the resolution on the creation of the gambling zone and we are now waiting for the appropriate decision,” Melnikov said, quoted by local news agency RIANovosti. “The operator of the gambling zone will be determined, tourist and hotel facilities will be created; we are confident that the gaming zone will become a kind of attraction around which an advanced infrastructure can be built. This is our main task,” the minister stressed.

Russia considers cryptocurrency ban The Russian government looking to block access to cryptocurrency exchanges in the country, describing them as “dubious instruments for retail investors,” according to Russian media reports. First Deputy Governor of Russia’s Central Bank, Sergei Shvetsov stated “we think that for our citizens, for businesses the usage of such cryptocurrencies as an investment object carries unreasonably high risks. We cannot give direct and easy access to such dubious instruments for retail investors.” Shvetsov described the bitcoin and virtual currency markets as comprising of a “pyramid scheme”.

Asia Gaming Briefings | November 2017

FOCUS 26

APE to make market debut, sees strong growth Asia Pioneer Entertainment, which this month joins just a handful of homegrown Macau gaming names to list on the Hong Kong Stock Exchange, says it sees strong scope for future growth, both in the world’s biggest gambling hub and around Southeast Asia.

T

he gaming distribution and service company was founded 12 years ago by Herman Ng Man Ho and Allen Huie Tat Yan and has expanded in tandem with Macau’s gaming industry. When the company first set out, electronic gaming machines were a sideshow in the territory, which was dominated by VIP baccarat.

However having lived overseas and noting the popularity of slot machines, the two executives predicted there would also be growing interest at home.

At present, only about 5 percent of revenue in Macau comes from gaming machines, compared with about 70 percent in Las Vegas, but that number has been growing steadily and has proved a lot less volatile over the recent downturn than table revenue,

Asia Gaming Briefings | November 2017

in particular from the VIP sector.

There have been several factors contributing to the growing popularity of slots and gaming machines in Macau, not least the new openings of multi-billion dollar resorts on the Cotai Strip that have added thousands of new products. A cap on live table tables by the Macau government has also helped to increase a push towards machines, as has an increased focus on the mass market, with more than 25 million tourists a year now visiting.

APE attributes its success on this macro shift in the market, combined with its in depth local knowledge of the operators, regulations and local gaming behaviour. “With the table cap, live gaming is limited, but tourist numbers are growing and not all can be high

FOCUS 27

rollers,” Ng said in an interview.

Huie describes the company as a technical services solutions provider of electronic gaming machines, and is one of just a handful of local agents. The company provides an integrated service from distribution to the operators, through to repairs and consulting on how to get games through Macau’s notoriously complex approvals process.

“It may look easy, but there’s a lot of technique to get it right for the market, to launch any product onto the floor you need a lot of experience,” says Ng. “Once you are on the floor there is no room for mistakes.”

Local preferences Although the market has undoubtedly been driven by new openings, those are now slowing down, with just two major players still to open their doors in the coming years.

MGM China will open MGM Cotai in the first quarter of next year, while SJM Holdings’ Lisboa Palace has been delayed most likely to 2019.

Despite, the end of the IR pipeline, APE says there is still plenty of room for growth in the Macau market. There are currently 18,000 machines on the floor in Macau and that will rise to 25,000 over the next two years. Beyond that, there will be ongoing renewals and servicing requirements that will keep the company busy.

However, Ng notes that the casino floors

are by no means at capacity. He says in theory, Macau’s casinos could accommodate up to 50,000 machines, but a lot will depend on China’s appetite for expanding the gambling market.

“If China can open the door bigger, the operators will buy more slot machines, there is space on the floor,” he says.

Still, APE is no longer wholly focused on its home market and sees major room for expansion in both Southeast and East Asia. The company has already moved with the Macau operators overseas, following Melco Resorts & Entertainment into the Philippines and also supplies equipment and services to Genting in Malaysia.

Although the minimum bets in the Philippines are lower, APE says there is a higher ratio of machines and more of a propensity towards social entertainmentdriven games. “I would put more social games into the Philippines to test, as you never know until you try,” Ng said.

To push the company to the next level, it’s now holding an initial public offering to raise between HK$60 million ($7.7 million) and $90 million, with the shares scheduled to begin trading on the Growth Enterprise Market on November 15.

“We went for a listing for several reasons,” Huie says. “The key was to access capital markets to fund our business plan as we move forward, but also to get better brand name and awareness, which will be

supportive to suppliers and manufacturers.”

“We are very well known to our casino customers, but hopefully this will get us known in a newer market in southeast Asia as well.”

Huie says the reaction from high net worth individuals and institutions the company has held talks with so far has been positive. “They like what we do.”

Supplier support The company plans to use the funds for deposits to support suppliers in getting more trial products on the floor and also to expand its technical support facilities in Macau, with a new workshop and increased technical support staff.

It also sees opportunities for leasing for selective customers, which it says should provide decent returns for the company.

Another area for potential growth is in refurbishments, as machines in Macau are replaced. Refurbished models can’t be resold in Macau, but APE says it’s getting a lot of enquiries from places such as Cambodia and Southeast Asia. Most are trading companies that take refurbished machines and distribute them through their channels.

As one of the few truly local gaming companies, APE says it’s confident that in the future Macau will have more homegrown talent in the industry, not just in distribution but also in product design.

Asia Gaming Briefings | November 2017

FOCUS 28

MGEMA calls for policy change to foster local firms The Macau government needs to change its policies to nurture the local gambling equipment manufacturers, as it is losing a golden opportunity to develop the industry and create quality jobs for residents, the head of the industry association said.

M

acau Gaming Equipment Manufacturers’ Association Chairman Jay Chun told AGB in an exclusive interview that he would like to see the current ban on revenue sharing between operators and gaming equipment suppliers amended to make it possible for smaller local suppliers to develop their products.

At present, Administrative Regulation 26/2012 makes clear that gaming revenue sharing arrangements between a gaming concessionaire/sub-concessionaire and a gaming manufacturer are not allowed and may result in the revocation of the gaming manufacturer’s approval granted by the regulator, the DICJ. Chun, who is also the chairman of Paradise

Asia Gaming Briefings | August 2017

Entertainment, said the association has carried out research and found that if revenue sharing were allowed, for every two, or maximum three machines involved, it would be possible to create one job opportunity at the same pay as a dealer.

“This industry is one of the biggest opportunities to bring industry back to Macau, for companies to grow up and export their product again,” he said. “It’s much better than just being a dealer, why reserve dealer jobs for locals, as that could be cheap labour. Operators can cut labour costs and the Macau people can work more normal hours,” he said, pointing to the 24-hour operations of the casino floors, compared with an 8-hour working day in a factory.

FOCUS 29

At present, dealer jobs in Macau are reserved for locals, with casinos only allowed to import labour for other service-related positions. The policy has added to already high employee costs in the territory, which has virtually no unemployment.

Chun said the potential for the local gaming manufacturing industry is huge and with the right talent could be expanded to cover newer and developing tech products, not necessarily focused on pure gambling.

Slot machines have historically taken a backseat to table games in Macau, accounting for just MOP11.38 billion ($1.41 billion) in revenue last year, compared with MOP118.9 billion for VIP baccarat and MOP76.9 billion for mass market baccarat. However, figures show that slot machine revenue was less volatile than table games and had been steadily been gaining in popularity up to the 2014 downturn.

Efforts by suppliers to create products specifically tailored to the Chinese have played a big role in generating more interest, but the market is still dominated by the large international suppliers, such as Aristocrat Leisure and Scientific Games.

Electronic table games on the other hand

have been the fastest growing area of the machine market in Macau, with live dealer games proving highly popular. Paradise’s LT Game unit has the largest market share in this area. In just four years, revenue from live multi-games has surged from MOP311 million in 2011 to MOP2.35 billion in 2016.

Rise of ETGs Players appear to be attracted by the fact they are able to get the experience of the live table game in a more private setting, while they are popular among operators as they reduce the number of dealers needed on the floor.

Chun says he expects slots to continue to gain in popularity, especially among the younger generation of Chinese players, who may have generated their wealth from the IT industry, or at least been highly exposed to new technologies.

However, to appeal to this clientele, Macau needs more innovation.

“Slots have been recovering better than the mass market in general, so we have seen them edging ahead for revenue, but they still aren’t as popular here as they are in Las Vegas,” he says. “That means we have an opportunity for

innovation; there’s room for something new to take hold in the slot machine landscape.”

“Aspect Gaming, another one of our members, is doing some great game designs to try to appeal more to the Chinese customer.”

Chun said the main theme of this year’s Macau Gaming Show is Smart City: Smart Economy, which will focus on both gaming and non-gaming technologies. He said the show aims to promote new entertainment offerings and innovation in the gambling sphere. Though he acknowledges that it may take time to persuade the operators to take a bet on something new, rather than sticking with what is tried and tested, with skill-based games for example struggling to make inroads.

Esports gain traction Esports, however, are proving to be more popular.

“That may bring opportunities for different types of games that are similar in some ways. I can’t tell you how successful one type of game might be or not be, but I do think there’s lots of opportunity for moving beyond traditional slot machines.”

One of the criticisms frequently levelled at the Macau market when it comes to introducing new games onto casino floors is the slow pace for regulatory approval. Chun said he now believes there is more clarity in that process, but what is perhaps lacking is reciprocity between Macau and other jurisdictions.

For example, he said LT won’t get a machine certified in Macau unless the company is sure that product is only going to be in the local market. On the other hand if it is certified in the U.S. or Australia, it can be introduced into multiple jurisdictions. That’s added time and expense for a smaller local manufacturer.

No going back Macau’s gambling revenue is now firmly on an upward trend, led by the VIP sector after three years of declines. Chun says Macau isn’t going to change overnight into a family friendly leisure destination and is likely to be viewed first and foremost as a gambling hub for many years to come.

That said, he believes the industry is moving in the right direction and despite the 35 percent surge in Q3 VIP revenue, he doesn’t think Macau has reverted back to a high-roller dominated, junket-driven destinations.

“We’re not going backward to the Macau of 2013. We’re evolving with the times,” he said.

Asia Gaming Briefings | November 2017

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SOUTH ASIA

30

INDIA

Lawyers party on skill gaming challenges It’s been a busy year in India for the gambling industry, at least for the lawyers involved in fighting court challenges on multiple fronts as to the legality of online skill gaming.

Asia Gaming Briefings | November 2017

SOUTH ASIA

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ames of chance are banned across India, apart from in a handful of states, such as Goa, Sikkim and the Union Territory of Daman.

However, in 1996, the Supreme Court introduced a wrinkle with a ruling saying that games involving a high level of skill were exempt, even if they were played for cash.

This included highly popular games such as rummy and poker. As a result, online versions of these games had been proliferating across the country, attracting the interest of foreign investors, such as Canada’s Clairvest, which earlier this year bought a majority stake in Ace2Three for $74 million.

The country’s biggest and only listed casino operator Delta Corp also ventured into the online space with the acquisition of Adda52.

However, in June, the state of Telangana threw a spanner in the works by banning online rummy. It charges that playing rummy online for monetary gains is a criminal offence as it involves both skill and chance and the presence of the latter makes it an activity tantamount to gambling, and not sports.

Where Telangana lead, several others have decided to follow. India has no federal law on gambling and it is up to individual states to set out their position. Andhra Pradesh and Tamil Nadu have both also decided to ban online rummy, while the Gujarat High Court

is currently deliberating whether or not to ban online poker. It is due to give its verdict towards the end of November.

The murky legal situation has led to challenges and counter challenges, leading as high as the Supreme Court, which was asked to rule on a petition filed by Krida Sports and Games, arguing that rummy should be able to be played for stakes without police interference. The Supreme Court dismissed the claim, handing the case back down to the individual state courts.

Meanwhile, India’s Sports Ministry is asking for consultation as to whether betting on sports should be allowed. The government has asked for opinions from the country’s sporting bodies and is said to be looking at a model similar to that adopted in the U.K., although it has warned the process may take up to two years to complete.

On the land-based side, Goa’s floating casinos are waiting for new legislation that may see them shift from their position in the Mandovi River to a new entertainment zone onshore near the Mopa International Airport within the next three years. The new rules are expected to be revealed in December and will also see a strict ban on local Goans gambling.

There are currently five boats moored in the river, while a sixth vessel that was supposed to make its debut ran aground

and sat stranded for months on a sandbank before being towed off for repairs.

Although there are no official figures for the size of the gambling market in India, the potential is thought to be huge. Statistics portal Statista put revenue generated by all gambling types last year at $113.5 billion, with a forecast to rise to $130.3 billion by 2018.

In its annual report this year, Delta said the industry had been growing at 40 percent a year for the past decade, with the rising middle class demanding more entertainment options.

In Q2, the company reported a 34.1 percent jump in profit, with revenue up 40 percent to Rs 189 crores ($29.1 million).

Delta attributed some of its success to the contribution of its online gaming business.

Delta runs three offshore casinos in Goa, as well as a land-based operation there, and at the beginning of the year opened a new property in Sikkim. Located within Hotel Denzong Regency in the capital Gangtok.

The new casino hotel will offer approximately 150 gaming positions.

The company also plans to open an integrated resort in Daman. The luxury hotel has been open since 2014, though the company has not yet had the go ahead to begin casino operations. The IR has earmarked 60,000 square feet for gaming, with an expected 1,200 positions, as well as MICE space and multiple food and entertainment options.

GROSS GAMING REVENUE 2016 2018

$113.5b

$130.3b

(Source: Statista, based on all gambling types)

Kerala eyes more lottery revenue The Kerala government says it is expecting to generate Rs.10,000 crores (US$1.5 billion) in lottery revenue for the 2017-18 fiscal year, after a decision was made to increase the number of daily printed tickets, local media reports. In the financial year ended March 31, 2017, the sale of state lottery tickets fetched an all-time revenue high of Rs. 7,395 crore. The Kerala State Lotteries Department (KSLD) has decided to print an additional 400,000 tickets a day, with effect from November 1, bringing the total number of tickets per day to 9.6 million.

Nazara Technologies to be India’s first gaming IPO Mumbai-based mobile gaming company, Nazara Technologies is set to be part of India’s first public listing in the gaming space. The Rs 10 billion (US$156.6 million) IPO is aimed for the end of March 2018, according to sources. It is expecting a valuation of 30-35 times projected profit after tax (PAT) of Rs 100 crore in FY19, added the source. Founded in 2000, Nazara is known for its Chhota Bheem game.

It has expanded globally over the last decade to 74 countries. It is also looking to expand from its focus in the casual mobile gaming space, to going into areas such as esports, and real money skill-based gaming. Nazara is expected to be valued at around Rs 3,000 - 3,500 crore.

Asia Gaming Briefings | November 2017

SOUTH ASIA 32

NEPAL

Tiger Palace makes debut as tourism recovers Nepal is slated to get its first integrated resort with the opening of Silver Heritage’s Tiger Palace Bhairahawa scheduled for the end of November.

T

he hotel held a soft opening in September and the remaining preparations are being carried out for the debut of the casino on Nov. 30th.

It’s been a long haul for the project, which has faced delays and cost overruns, in part due to the massive earthquake that devastated vast swathes of the country in 2015.

In February, the Australia-listed group warned the project was delayed and over budget and said it would now cost AS$18 million ($13.8 million) more than planned at $70.3 million. It said the extra money was needed due to variations from the original plan for the casino and public areas, as well as land improvements. It also faced issues with costs arising from local contractors and delays in gaining approval from the Nepal Central

TOTAL TOURISM CONTRIBUTION TO GDP 2016

2027E

$1.6b (7.5% of GDP) $2.7b (8.3% of GDP)

(Source: World Travel & Tourism Council)

Asia Gaming Briefings | November 2017

Bank to raise the equity ceiling for the local operating unit. This affected the company’s ability to remit money into the country.

The company has since appointed a new team of experienced Asia executives, led by Adam Titus, who most recently worked with MGM Resorts in Macau and Okada Manila.

Silver Heritage is counting on vast untapped demand from India to drive revenue, being located next door to Uttar Pradesh province, with 215 million people. India is expected to have the world’s largest middle-class consumption on an annual basis by 2030 at about $12.8 trillion compared with $10 trillion for China.

The resort has 100 five-star rooms and 2 villas in the first phase, with plans ultimately for 400. The company is already running The Millionaire’s Club and Casino out of the five-

star Shangri-la Hotel in the capital Kathmandu.

For the first half of the year, it reported a win per day of $789 for table games and $41 for electronic gaming machines.

Nepal’s casino sector is gradually getting back on its feet after the earthquake and a government shutdown of the properties due to the failure to meet requirements set out in legislation designed to bring the industry more in line with international standards.

Aside from the Millionaire’s Club, Casino Mahjong at the five-star Hotel Soaltee; Casino Royale; Casino Pride and Casino Rad have reopened their doors. That’s down from 10 before the government clampdown, although more are scheduled to open.

Coming off an earthquake-hit base, Nepal recorded a 31 percent gain in tourist arrivals for 2016 to 729,550, although these numbers don’t include those crossing by land from India. Of the air arrivals, 16.2 percent were from India and 11 percent from China, with the U.S. rounding out third place with 7.3 percent of the total. Nepal’s economy has also rebounded, recording growth of 7.2 percent in the fiscal year ending mid-July, its highest rate in more than 20 years. It is expected to slow this year due to flood damage to crops, but it still expected to hit growth of about 4.7 percent.

China arrivals surge in H1

Delta to run Marriott Kathmandu

A total of 1.87 million passengers passed through the The Tribhuvan International Airport in the first half of this year, up almost 13 percent from last year, the Kathmandu Times reports. Much of the increase came from a 169 percent increase in passengers carried from China, thanks to Beijing’s decision to announce 2017 would be Nepal Tourism Promotion Year. Chinese carriers - Air China, China Eastern, China Southern and Sichuan Air flew 152,829 travellers, up 169.18 percent.

India’s Delta Corp has signed a Memorandum of Understanding (MoU) with Everest Hospitality and Hotel Pvt Ltd to operate a casino at the Marriott hotel in Naxal, Kathmandu. The Marriott Kathmandu is scheduled to open from June next year. “Implementing the Marriott brand standards, designed by renowned architects and utilizing the best construction companies, the hotel consists of state of the art services including a spa, casino, and a variety of restaurants, swimming pool, gym, exclusive suites and lounges,” a statement from Everest said.

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www.LondonAffiliateConference.com Asia Gaming Briefings | November 2017

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AUSTRALASIA

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AUSTRALIA

VIP shows signs of life after China detentions Australia’s casinos are seeing an improvement in their VIP business and can look forward to a brighter year in 2018, as the market recovers from a collapse triggered by the detention of Crown Resorts’ employees in China.

Asia Gaming Briefings | November 2017

AUSTRALASIA

A

35

ccording to Morgan Stanley analyst Crown, whose digital business was the Monique Rooney, recent discussions strongest growth area for the company last with industry contacts have pointed year, has also taken a big step into skill-based to a material improvement in junket gaming. Though many have been mulling the operations since the start of the Australian benefits of these new types of games to appeal fiscal year in July. to the younger generation, Crown has jumped “Whilst we acknowledge that VIP is quite in, forming a joint venture with New Gaming volatile in nature, we do however believe the Pty to roll out a series of skill-based products. outlook is more promising vs our previous Rival operator Star Entertainment also saw expectations,” she wrote in a note. a drop in its VIP business in the year, though The firm has raised its forecast for Crown’s was able to offset the decline by diversifying VIP revenue next year to 9.4 percent, a swing its international business and reaping the from its prior estimate for a drop of 6 percent. rewards from the revamp at its properties in Star Entertainment Group, which was not both Sydney and the Gold Coast. affected as badly, is expected to see an 8.4 Star is forging ahead with its $3 billion percent gain next year compared to prior Brisbane project, beginning demolition and forecasts for a 6 percent increase. preparation work at the Queen’s Wharf site. The The VIP business in Australia was hit resort, which is being developed along with Hong hard by the arrest of 19 Crown employees in Kong’s Chow Tai Fook and Far East Consortium, China in October 2016 on charges they were is expected to open its core areas in 2022. promoting gambling. A Shanghai court in June Other ambitious projects planned for handed down sentences Queensland have, as to 16 of them, though widely expected, run these were adjusted into difficulties.

Whilst we for time already spent TheASFConsortium’s in jail and most have proposal to build an acknowledge that been released. integrated resort at VIP is quite volatile the Southport Spit was The damage was severe. Australia’s share nixed by the Queensland in nature, we do of the global VIP market government, while Hong however believe dropped to 3 percent at Kong investor Tony end June from 6 percent Fung has dropped plans the outlook is previously, throwing into for an A$8.15 billion more promising doubt several planned integrated resort to be vs our previous developments targeting known as Aquis Barrier the China VIP market.

Reef. The entertainment expectations.

It also prompted Star complex is still being Entertainment Group built at a quarter of the chairman John O’Neill budget and without the to warn against an over reliance on the China casino element. tourism dollar in Australia.

The Queensland government is looking for Crown Resorts’ profits for the full year to bidders for the license and says it has had strong end-June clearly showed the consequences. interest, though analysts are sceptical that the Normalized profit fell 15 percent to $343.1 type of mega-project Aquis and ASF had been million, while VIP program play plunged planning could be supported. Australians still by a half. show a preference for slot machines in pubs However, reported profit at the operator, and clubs over ritzy casinos and the decline which is developing a six-star VIP only resort in the VIP market demonstrated the pitfalls in Sydney, doubled to $1.86 billion as it booked from relying on one set of clientele. gains from the sale of its stake in its Melco It’s also been a hard year for Australia’s online Crown Entertainment venture. market, with amendments to the Interactive The operator marked its final exit from Gambling Act passed by the Senate in August. the decade-long venture, which brought to It’s now illegal for any offshore operators to life iconic properties such as City of Dreams target Australian consumers, with online Macau and City of Dreams Manila, in May. bets only permitted by those licensed in the It had begun the process in late 2016, also country and only on lotteries and sports. It pulling out of a planned project in Las Vegas, has also outlawed in-play betting. to focus on the domestic market.

As a result, there has been an exodus of

“

”

GROSS GAMING REVENUE 2018E VIP Crown

2018E VIP Star

Total 9.4% 8.4%

Melbourne 14%

Perth -5%

Sydney 5%

Queensland 25% (Source: Morgan Stanley)

Lottoland battles to avert ban Lottoland is lobbying state governments to head off a ban on synthetic lotteries after incumbents complained about loss of revenue. Chief executive Luke Brill recently met with authorities in Western Australia for talks, amidst reports that New South Wales is also considering restrictions. Tasmania has already announced plans to ban betting on lottery outcomes.

GLI appoints Erdal Eskin as Australia COO Gaming Laboratories International (GLI) is welcoming its new GLI Australia chief operating officer (COO) Erdal Eskin. With over 20 years of experience in the Australian gaming industry, Eskin has forged strong relationships with the clients he has worked with and has served in various progressive roles within the industry. As GLI Australia COO, Eskin manages GLI’s Sydney laboratory and oversees operations and supplier relations for each of the GLI’s three Australian-based laboratories in Sydney, Adelaide and Melbourne.

companies, such as Pokerstars, Vera&John and 888poker.

Although the online sports betting market is thriving, there is a further cloud in the form of tax changes that may take a heavy toll on revenue. South Australia introduced a point of consumption tax in July that will impose a 15 percent tax on revenue in excess of $150,000 on any bet taken in the state, irrespective of where the company is based.

Industry players are now concerned that the tax will be introduced nationwide, clouding prospects for the booming sector.

Asia Gaming Briefings | November 2017

AUSTRALASIA 36

CNMI

IPI topline growth continues as casino makes difficult debut The opening of Imperial Pacific’s resort on the South Pacific island of Saipan had been one of the most eagerly anticipated openings in Asia in recent years, though in the end the casino made its debut with very little fanfare in July this year.

T

he company, which beat rival Marianas Stars Entertainment for a license in 2014, had set the date for a lavish Chinese New Year event, though few familiar with the pace of construction on the island had expected that target to be met.

Since more than doubling its initial investment pledge to $7 billion shortly after being awarded the license, the project has been plagued by a series of weather and labor-related problems. Typhoon Soudelor swept across the island chain in 2015, causing widespread

devastation and forcing the temporary closure of the airport to civilian flights.

It also created a scarcity in local raw materials and labor needed for the construction of the white and gold waterfront palace. Still, Imperial Pacific forged ahead and won the right to operate a temporary facility out of the luxury T-Galleria shopping mall to generate revenue to help finance the development.

It was the numbers generated by the 48 tables at the tiny casino that generated all the buzz. VIPs rolled in, mainly from China, despite

GDP GROWTH

Percent change from preceding years 30 20 10 0 -10 -20 2008

2009

2010

2011

2012

2013

2014

2015

2016

(Source: US Dept. of Commerce)

Politician seeks GGR-based tax

Casino spending fuels GDP

House Representative Edwin Propst has said he plans to push for a 10 percent tax on gross gambling revenue for Imperial Pacific. “We will go through the painstaking and long process of an initiative petition,” he wa quoted by local media as saying, adding that the proposal would be supported by community members.

Propst noted that prior attempts to introduce a GGR-based tax on the casino had stalled and therefore taking the proposition direct to the people was the best way forward. The CNMI Constitution allows the enactment of laws through people’s initiative.

The Commonwealth of Northern Mariana Islands posted a 28.6 percent jump in gross domestic product in 2016, driven mostly by the services sector, reflecting growth in tourism spending. Service exports surged by 72.8 percent, compared to a 14.9 percent gain in 2015, while visitor arrivals in the year were up more than 10 percent. “Private fixed investment [in CNMI] increased over 60 percent in 2016, reflecting construction of the casino resort in Garapan and other hotel construction on Saipan,” said the federal commerce department.

Asia Gaming Briefings | November 2017

a scarcity of any suitable hotel accommodation.

The casino was generating monthly VIP roll averaging at about $2 billion.

As the date for the opening of the casino approached, the company’s problems appeared to mount in tandem. International credit rating agencies Moody’s and Fitch both expressed concern about the financing situation, both downgrading Imperial Pacific’s credit rating early in the year.

Then came reports that the Federal Bureau of Investigation was investigating

AUSTRALASIA 37

one of the project’s main contractors after the death of a worker. The probe uncovered undocumented Chinese workers working illegally on the site.

Imperial Pacific moved to announce new workforce rules banning any individuals who are not authorized to enter the construction site. On May 1, 2017, the Imperial Pacific Security Department hired Island Protection Services to secure the Garapan construction site was adhering to rules.

Still, the workforce issues have not gone away. Labourers claiming back wages picketed the opening of the casino and more recently 37 have refused an offer to be paid and sent back to China, seeking further compensation.

IPI held a “preview” of its casino facilities at the end of March, but it wasn’t until July 6th that the casino finally opened its doors to the public, offering about 70 tables and 190 machines, including baccarat, blackjack, Texas Hold ‘Em, roulette and sic bo.

However, it was only the casino that opened in July. The company filed an amended timetable for the rollout of the rest of the facilities in

August, pledging the full opening of the initial facility no later than August next year. This will include at minimum, a 329-room four or five star luxury hotel; 14,140 sqm of gaming area; 3,870 sqm of food and beverage outlets; 186 sqm of retail space; 930 sqm of meeting space; 15 villas; 1,500 sqm of spa/fitness area; and associated parking, site improvements, landscaping, furnishings, fixtures, utilities and infrastructure.

Revised timetable Phase one is to be completed no later than August 13, 2023, and shall “result in the establishment of a fully functional integrated resort, while the full rollout is expected by 2028.

The group stopped publishing monthly VIP rolling figures in June, though said it would make an announcement if the amount were to drop below $2.5 billion a month, which so far it hasn’t. For the first half of the year, it reported an 8.9 percent increase in profit to HK$912 million ($116.9 million). Revenue was up to HK$7.3 billion, up from HK$3.98

billion in the prior year period.

Best Sunshine Live saw VIP table games rolling rise to HK$196.3 billion in the half year, compared to HK$104.7 billion in 16H1.

The mass market business did gain, but was negligible compared with the VIP. Elsewhere in the region, little progress has been made developing casino resorts.

The Tinian Dynasty Hotel & Casino, whose license was revoked in 2016, was ordered to pay a $191,400 civil penalty to the U.S. Department of Labour for infringements of workers rights.

While, the company behind the $130-million Tinian Ocean View Resort and Casino launched an online petition seeking support after the denial of a Master Siting Permit. The Bridge Investment Group (BIG) has already spent more than $13 million on construction of the casino resort, but a roadblock emerged when the commonwealth regulatory agencies determined that the proposed activities at the Tinian Harbor, by which the casino resort is located, did not meet the technical definition of “port-related activities.

Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT 38

MGS 2017

Tapping into technology Jointly backed by the Macau SAR Government and over 150 gaming and entertainment companies, the MGS Entertainment Show returns to the Venetian Macao for its fifth anniversary on November 14-16, 2017.

O

rganized by the Macau Gaming Equipment Manufacturers Association (MGEMA), MGS bills itself as a broad-based gaming, entertainment and leisure tradeshow which attracts established suppliers to the gaming industry as well as trail blazers that are reshaping the entertainment and leisure landscape.

This year, MGS will focus on innovations that will shape the future “smart city”, featuring a number of leading technology companies including humanoid robot manufacturer Qihan, cloud computing giant Alibaba Cloud and video surveillance company Hikvision.

The three-day MGS Summit, featuring almost 20 sessions on subjects including next-gen technology, government partnerships, economic investment, new territories and artificial intelligence and engaging multimedia millennials will also make its return this year.

Announcing the remit for the Summit, Jay Chun, chairman of the MGEMA said, “The international gaming industry has reached a pivotal stage in its development.

Next-gen technology is the powerhouse of our business, and the new wave promises so much more for us, especially with the ambitious and lucrative economic project along

Asia Gaming Briefings | November 2017

the Silk Road trading route gathering momentum.

“This year’s MGS Summit has to examine the rising forces within our industry, such as new platforms, AI, VR and payment systems and see how they can pioneer a smarter business ethos across all industries and communities and drive a smarter and healthier economy.”

Mr Chun added, “Over here, we now have a multitrillion-dollar trading plan underway in the shape of the Belt and Road, expanding economies from the East to West. The gaming industry has an opportunity to ensure that our new technology can make cities prosperous both financially and through exciting innovations that bring greater entertainment, education and efficiency to every level of our community.”

Key speakers include officials from the Macao SAR Government, the leading figureheads in Asian gaming, major corporations in Macao and the Asia-Pacific region, and international luminaries and influencers that are playing a pivotal role in the region’s growth and development.

“The Summit will piece together the process for building a model that will drive the Smart City, Smart Economy ethos across the world,” said Chun.

SUPPLIER SPECIAL REPORT 39

Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT 40 ANGEL

50 years experience

A

ngel Playing Cards is a pioneer in the manufacture of superior casino grade playing cards with over 50 years of experience.

Since its inception in 1949, Angel Playing

Cards has consistently been providing the global market with the best quality playing cards, following their basic policy of aspiring for perfection.

At present, Angel has been fortunate to call many casinos, their customers, including the leading casinos in Asia and Australia.

“We believe that ongoing communication with customers is essential in building

a mutual understanding, and ultimately increasing our customer’s satisfaction. We started many of our business relationships in this fashion. We place a high value on face to face meetings to ensure that we provide the highest possible quality, service and security,” said the company.

Visit Angel Playing Cards at the MGS Entertainment Show 2017, on stand AN29.

ARISTOCRAT

New hardware and game innovations

A

wide range of innovative and entertaining products will take center stage on Aristocrat’s stand at the Macao Gaming Show (MGS).

“At Aristocrat, we continually strive to use our passion, dedication, and creativity to provide our customers with innovative solutions that entertain their guests. At Macao Gaming Show, we are excited to reveal the latest additions to our deep and broad portfolio that help our customers entertain every type of patron,” said Aristocrat Asia-Pacific managing director Chris Rowe.

The innovations begin with a solid foundation of new hardware, including the Helix+ cabinet, which is making its Asian debut at MGS. Helix+ features full HD 27” monitors, larger screens for a more immersive player experience, improved designed and serviceability. Aristocrat brings a wide variety of new and existing games to Helix+, including the 5 Dragons series, its best performing link – Good Fortune, Lighting Link, and new products such as Long Teng Hu Xiao - Mighty Cash.

Aristocrat’s Arc Double cabinet makes its Asian debut at MGS in grand style. The Arc Double cabinet impresses with dual 42” curved high-definition LCD touch screens, upgraded graphics capabilities, and 5.1 stereo surround sound.

The cabinet comes to Asia with 5 Dragons Grand, an extension of the 5 Dragons family of games, and offers players new and exciting features, while maintaining the family’s’ original charm. The new 5 Dragons Grand game features player-selectable volatility and a linked jackpot, where players can win multiple jackpots through the games new wheel feature.

Aristocrat will also showcase games created specifically for the Asian gaming marketplace.

First is 5 Dragons Empire Link on the Arc Single cabinet. 5 Dragons Empire Link adds an extra

Asia Gaming Briefings | November 2017

layer of linked excitement to Aristocrat’s popular 5 Dragons and 5 Dragons Deluxe titles. Additionally, 5 Dragons Rapid – 5 Dragons Empire is a new title added to 5 Dragons Empire Link family.

Next is Aristocrat’s Games of Fortune collection, featuring the new Baccarat Streak and Baccarat Zhuan Zhuan Fa slot games on the Arc Single cabinet. These are the latest creations in Aristocrat’s Baccarat line and are based on the classic Baccarat game and wrapped in Aristocrat’s creativity.

Aristocrat will also showcase new linked products. First, the globally popular Lightning Link library expands with three titles created for the Asian marketplace: Happy Lantern, Dragon Riches, and Eyes of Fortune.

Next is Long Teng Hu Xiao - Mighty Cash which offers ultimate flexibility with both link jackpots and game configurability. This new Reel Power game is an evolution of Aristocrat’s popular Hold & Spin mechanic and has a highly Asian-centric theme, player-selectable multidenomination configurability, and the popular what-you-see-is-what-you-get style of game play.

Aristocrat’s line of standalone games expands with 5 Kings, Aristocrat’s first Korean-based theme. 5 Kings tells the story of the Legendary Dangun, founder of Korea’s first Kingdom.

5 Kings is a Reel Power game and combines outstanding graphical craftsmanship with established features, such as a choose-yourvolatility feature and proven math model.

Next, 5 Dragons Rapid extends the excitement of 5 Dragons to Aristocrat’s core products standalone game category. Also showing are Fortune King Rapid and Cash Fusion – Valkyrie Thunder and Peacock Riches.

Aristocrat will also show the standalone progressive titles Spin It Grand and Gold Stacks. Spin It Grand has entertaining features, such as a wheel-style mechanic in the top box, Metamorphic Bonuses, and scalable prizes by denomination and stacked symbols. Gold Stacks features a unique wagering configuration that offers players an innovative Gold Reel. Buying the gold reels gives the player stacks of major symbols where the gold appears on the reels.

Join Aristocrat on stand AO38 at the show.

SUPPLIER SPECIAL REPORT 41

Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT 42 ARUZE

Changing the game

A

ruze Gaming continues its quest in Changing the Game at this year’s Macau Gaming Show. The company will be showcasing the newest addition to the excellent line of electronic table games, along with the Asia debut of the X-Station player terminal.

Super Big Wheel, the extravagant sequel to Aruze’s Lucky Big Wheel, cannot be missed.

With a brand new projection mapping and wheel LED design, as well as a thrilling new jackpot feature, Super Big Wheel brings a whole new gaming experience. This beautiful creation is sure to have players on the edges of their seats, as they pull the wheel lever and spin the wheel to new levels of excitement.

The X-Station player terminal will also be displayed with Super Big Wheel. This new player terminal for electronic table games is

set for a debut in 2018.

Fu Lai Cai Lai is the newest link progressive series for the Cube-X Video platform with 3 different titles, Triple Festival, 5 Sea Legends, and Stack Wild Luxury. The Jackpot Feature, can be triggered when playing bet 2, 3, 4 or 5, and can also be triggered when the large gold symbol drops down on the game screen randomly in bought and free games.

Aruze also continues to support their core Cube-X Innovator and Vertical products.

Denise Amorim of Aruze Gaming Macau Limited, states “With all these new products to be shown at this year’s Macau Gaming Show, there is no doubt Aruze is bringing a different level of excitement.”

Find Aruze at stand BB33 during the show.

BETCONSTRUCT

Fully equipped

B

etConstruct will showcase its entire product line at MGS this year, which includes updates and additions to its gaming and betting products.

BetConstruct, fully equipped, will showcase products including Sportsbook, Skill Games enhanced with new features, Fantasy Sports, RNG & Live Casinos. It will also talk about services and reveal the company’s new concepts.

BetConstruct Sportsbook with a coverage of 30,000 live matches per month will be

Asia Gaming Briefings | November 2017

presented at the expo. The recent upgrades of the product are UX focused. Sportsbook is improved to be easily customized via SpringBuilder and its drag ‘n drop features and tools specifically designed to manage the gaming and betting websites. As for the technical aspects, the inner reporting system of Sportsbook has significantly changed. In total, BetConstruct Sportsbook gained more advanced features which will provide more

freedom to operators and facilitate their website customization experience.

New features are also added to some other vertical products. For the greater appeal of the players, the company has enriched its Fantasy Sports software with new types of American sports including basketball, baseball, rugby and ice hockey.

With an increasing range of 3,000+ individual games, BetConstruct Casino Suite has a huge appeal for any player and is a business growth opportunity for any operator.

The vertical products are not the only offering that our visitors will experience. Spring BME, business management environment, is the star of the year 2017 for BetConstruct. The platform is developed to make it remarkably easy for our partners to take control over their business and its various aspects. Officially unveiled on July 11 in Amsterdam before iGaming Super Show, the launch of Spring BME is planned for the late autumn and it promises to become a game changer of the gaming industry.

“When developing BME, we tried to bring together every product and service we believe is important for a B2C provider, presenting them in the most user-friendly way. And, naturally, there is a feedback section that will help us improve the performance,” said BetConstruct CTO David Gasparyan.

BetConstruct team can be found at stand AF22 at the Macao Gaming Show.

SUPPLIER SPECIAL REPORT 43

Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT 44 GLI

Cyber and IT security measures

G

aming Laboratories International (GLI), under its professional and technology services brand, Bulletproof, is urging its clients to examine the cyber and Information Technology (IT) security measures currently set in place at their gaming establishments to ensure all assets are safe and secure.

The company offers the following IT security services including cybersecurity services, source code security audits, Security Operations Center (SOC) as a service and cybersecurity incident response and forensics With nearly 30 years of gaming industry experience, GLI is the world leader in gaming certification and testing and understands your operation both inside and out, leveraging innovative testing methodologies and advanced tools. They offer access to resources in every jurisdiction in the world to ensure your business is successful.

GLI Asia Limited general manager client services Marina Wong said, “GLI and Bulletproof are very excited to offer the very best IT security services to our clients in the Asia-Pacific region. We utilize best-in-breed methodologies to ensure we are offering the most comprehensive security services in the gaming industry. No project is too large or too small for our experts. Please visit with our experts to determine the best solution for your gaming operation.”

See GLI and Bulletproof at the MGS Entertainment Show on stand AL31.

Asia Gaming Briefings | November 2017

IGT

Progressive prowess

I

GT continues to make significant investments in local markets with in-market leadership, a localized approach to content creation, and an organizational structure that enables the company to be agile when addressing the unique needs of its customers.

At MGS, IGT will present a vast lineup of new innovative games that reflect this fresh approach.

“Over the last 18 months, IGT has maintained a keen focus on rebuilding and refocusing our business strategy throughout Asia,” said Andrew Neagle, IGT senior sales director. “IGT is ready to deliver the many games and solutions that we have developed specifically for gaming in Asia. We believe our new Asia-centric solutions portfolio gives our customers more choices for diversifying their casino offerings and for sparking players’ interests with new game styles and play mechanics.”

Igniting the new direction in game design is IGT’s new Prize Disk game concepts – one of many highlights within IGT’s MGS stand.

IGT will showcase two Prize Disk games

at MGS – Elephant King and Wolf Ridge.

The games’ innovative Prize Disk feature displays the bonus values, free games and jackpots that can be awarded once the feature has been triggered.

One of the hottest launches at MGS will be IGT’s new Hyper Hits theme with two games: The Golden Bow and Lotus Princess.

Hyper Hits takes player and operator flexibility to new levels. For example, the games are available as a linked progressive, or as standalone progressives. Additionally, operators can configure denomination, RTP, and six jackpot start-up options, and players can win five different bonus prizes, plus jackpots.

“MGS provides a platform for IGT to showcase our newest game development and a direction that we believe can ignite growth and player engagement for our customers. We look forward to sharing our many Asia-focused products with our customers at the MGS,” added Neagle. IGT can be found at stand AI30.

SUPPLIER SPECIAL REPORT 45

Everyone is a winner.

Congratulations to Asia Pioneer Entertainment

nov

11 / 14 Tue. 10:00 - 18:00 11 / 15 Wed. 10:00 - 18:00 11 / 16 Thu. 10:00 - 17:00

www.jumbogames.com.tw

Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT 46 INTERBLOCK

Diamond ETG

L

uxury gaming manufacturer Interblock has announced its participation in the 2017 Macao Gaming Show, exhibiting products from its Diamond portfolio including Big Six, Craps, Roulette and Sic Bo. Mr. Michael Hu, vice president of Asia at Interblock said, “We are excited to exhibit our latest innovations at the Macau Gaming Show. Our presence at this event shows our commitment and support to this market as we continue to increase our footprint throughout the Macau region.”

The company will exhibit its latest automated Big Six wheel, which launched new, vibrant wheel segments that are more appealing to Asian demographics at G2E Asia this year. Interblock’s Big Six wheel is not only the largest wheel in the industry, but is also the only double-sided wheel offering which allows operators to place play stations on one or both sides.

Interblock’s Diamond Roulette and Diamond Dice generators will also be exhibited on the company’s stand. The generators will demonstrate their connectivity to remote play stations and LCD displays, which will showcase an array of new virtual dealers for Roulette, SicBo and Craps.

Interblock will showcase its products on stand AS34 at the show.

iSoftBet

Busy conference schedule

O

nline and mobile casino content provider iSoftBet has a packed conference schedule to round off the year, and will set up shop at three of the industry’s largest events over the next two months.

The supplier will be exhibiting at EiG Berlin (October 30 to November 1), the Macao Gaming Show (November 14-16) and SiGMA (November 22-25), with its senior management team on hand to meet with delegates.

At each conference, iSoftBet will return with a bigger and better stand than before, and will use the events to showcase the latest additions to its expanding game portfolio, including its most recent hit, Disco Double.

At EiG, delegates will be able to learn

Asia Gaming Briefings | November 2017

more about the supplier’s recently enhanced Free Rounds tool; the feature is not limited to iSoftBet’s games, and is available across all third-party content integrated into its Game Aggregation Platform (GAP). In addition, the supplier’s full suite of games will be on show, including its branded slots and table games. iSoftBet’s stand at the Macau Gaming Show will be twice the size as last year. The focus will be on its new HTML5 development framework, Pulse, which offers a superior user experience and lightning-fast load times.

This year marks the second time iSoftBet has exhibited at SiGMA, and it returns with an even bigger diary than the previous year, offering more meeting slots with operators and delegates.

Michael Probert, head of business development at iSoftBet, said: “We have a packed conference schedule to round off what has been a very successful year for iSoftBet and our partners.

“We are always excited by the chance to meet with operators, and to showcase our fantastic suite of blockbuster games, powerful Game Aggregation Platform and first-class service offering.

“It is also a great opportunity to launch the innovative features and products we have been working on throughout the year, and look forward to talking about them with delegates at each conference.”

Find iSoftBet at the upcoming Macao Gaming Show at stand AV32.

SUPPLIER SPECIAL REPORT 47

Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT 48 LAXINO

New business partner

I

n order to help with this year’s MGS 2017 theme – Smart City, Innovation and Interactive, Laxino is will be introducing a new business partner, Pacific Intellectuals Alliance (PIA), to launch their very first cloud-based gaming platform “GameSource” to the land-based casino market.

GameSource is a revolutionary product that streamlines the operation and monitoring control for land-based casinos. In addition it is an infotainment platform offering a wide variety of game choices to players. Furthermore, with the introduction of the Game Developer Program, it will open up direct market access to global game developers to integrate their games onto the platform, which will be made available to the land-based casino market via GameSource.

PIA believes that with the introduction of GameSource, it will create an innovative impact in the current gaming industry, and it will assist

LT Game

MATSUI

L

M

Robot dealers T Game is one of the major gaming and casino providers in Macau and in the world. Some of its avant-garde gaming products include the Live Multiple Games System, which has live dealers, supports multiple tables and has a terminal-based multi-game selection system, as well as electronic table game products and cash handling products.

LT Game is striving to provide a Total Casino Solution and to be at the forefront of the global gaming industry.

This year, the ADV1 will be featured. ADV1 is a cutting-edge technology product that can repeatedly deals cards in Baccarat 24 hours a day, 7 days a week.

It aims to resolve situations where there is a lack in human resources and fatigue in staff.

The product is able to improve accuracy of card dealing, and reduce human error, and also provide a real-time monitoring and management system.

Meet the team at stand AJ18.

Asia Gaming Briefings | November 2017

the operators to offer enhanced entertainment to current players, and attract a new line of millennial players.

Blue Technology Limited, a representative of Hydako throughout Asia and a sales agent for Novomatic and Apex within Macau, is also exhibiting with Laxino in MGS 2017 this year.

They will showcase three of their latest slot machines in the MGS Slot Experience Center and believe these slot machines can surprise and enhance the overall player user experience.

Find Laxino and their partners at stand AV38 during the Macao Gaming Show.

Matsui chips

atsui will be showcasing the latest Matsui Chips product line at MGS 2017.

The company has extended its gaming currency portfolio through focused investment behind the new security and newly designed moulding segments.

Added to the traditional security features such as Visible & Invisible UV, Matsui will introduce their exclusive MG EYE security including MG EYE EDGE and newly added Laser Trace security. As well as those security features, their newly developed heavy weight decal chip series will be introduced.

Shigeki Machida, managing director of Matsui Asia commented “We are very excited to introduce those new gaming chips as well as our other core products such as high durable heavy weight layouts to our customers at MGS 2017. We are also excited to launch a new series of chips with our standard decal style products but with heavier weight. Those new chips have capability of accommodating RFID technologies as well.”

With its Macau branch celebrating its tenth anniversary, Machida said. “Thanks to all our loyal customers,we have just finished our Macau subsidiary’s tenth anniversary year with the best results ever. We received millions of chip orders and thousands of layouts were delivered in the Asia Pacific area. To respond to customer’s very high demand to our products, we needed to expand the production capacity at our factory.

New machineries and equipment have been installed to further speed up the production while the facility has also been strengthened, manufacturing security for gaming chips with state of the art technology”.

“We are very glad that Matsui Chips and Layouts are chosen by operators all over the world. Our team members are looking forward to meeting our friends and new customers at MGS.” said Machida.

Visit Matsui at stand AO24.

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Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT 50 NOVOMATIC

V.I.P. Lounge

N

and customizable layouts. The luxurious V.I.P. chair with its integrated sound system creates intense sound impact with individual volume controls, as well as extra start buttons in the arm and footrests. The cabinet fits into a space-conscious 76.5 cm wide area with a maximum depth of 165.7 cm including the chair, thus creating the unique V.I.P. experience in a space-optimized lounge format. The V.I.P. Lounge allows for players to simply sit back, relax and play at their maximum comfort level.

The V.I.P. Lounge comes with a full library of available game titles and multigame editions based on the NOVO LINE Interactive and Impera-Line HD platforms, which are available with multi-language settings featuring up to 16 languages for the international markets, including Cantonese.

NOVOMATIC can be found at the Laxino stand at AV38.

OVOMATIC’s V.I.P. Lounge cabinet has already been a resounding success in the European and American markets, and it has now arrived in Asia.

Visitors to this year’s Macao Gaming Show will have the opportunity to experience the innovative V.I.P Lounge cabinet featuring the thrilling single-player roulette game Globe Roulette Pro. The V.I.P. Lounge creates a new, hot product category and its success is due to several critical factors of the cabinet design – two 32” HD LED screens placed at an optimal viewing angle deliver an excellent graphic presentation of the game and sophisticated LED framing creates a game-synchronized indirect glow effect that maximizes game impact as well as attention on the gaming floor.

The player interface is either available as a dynamic 12” tablet-style TouchDeck or in a variety of standard button panel styles

Scientific Games

RGB

Dualos cabinet for the Asian player

S Round the clock service

Pantone

PMS 109

Process Black

Cyan Magenta Yellow Black

0 10 100 0

100 0 0 0

Red Green Blue

R

cientific Games will be featuring its new Dualos cabinet, a dual screen upright cabinet which is specifically designed with the Asian player in mind.

The cabinet offers unique, exclusive content customized to players, as well as gaming experiences that have already been player-proven favourites in the Asia market.

In the tradition of Duo Fu Duo Cai, SG Gaming is also proud to introduce ‘Jin Ji Bao Xi’ – the latest multi denominational progressive linked jackpot.

Offering a new base game, Echo Fortunes,

RGB

Websafe

255 221 0

35 31 32

FFDD00

231F20

GB is a leading Gaming Solutions provider in Asia with more than 30 years of experience in the gaming industry.

RGB is an authorized distributor of gaming products for world renowned brands. Its clients include some of the major casinos in the world’s gaming industry.

With regional offices in all the gaming capitals in Asia, RGB serves its clients round the clock including leasing of its suppliers’ top range machines, tables and utilities to its valued clients. RGB provides a machine leasing program to more than 40 operators throughout Asia.

To value add, RGB with hundreds of technically skilled employees who have been accredited by most major manufacturers provide periodic maintenance and technical services to gaming products for some of the major casinos.

RGB will be located at stand AJ38.

RAL

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Applicationfilm

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Asia Gaming Briefings | November 2017

that incorporates familiar sounds and symbols, Jin Ji Bao Xi has been expertly crafted to entertain and reward players with exciting new features and bonuses.

Created for the superb Dualos cabinet, players will be able to select from 5 denominations and play for two incrementing jackpots LUCKY FORTUNE GRAND and LUCKY TREASURE MAJOR as well as two fixed bonus prizes LUCKY PEACH MINOR and LUCKY ORANGE MINI that increase in value based on the chosen denomination.

Find the SG team at stand AI34.

SUPPLIER SPECIAL REPORT 51

V.I.P. COMFORT IN COMPACT LOUNGE STYLE NOVOMATIC proudly presents the Very Important Player Experience in compact lounge style. There is no better way to offer the unique V.I.P. feeling to the guests in a space optimized lounge format.

Globe Roulette™ pro is a modern single player Roulette that offers players the traditional betting options range of French Roulette. Multi-language settings comprise 16 languages for the international markets – including Cantonese.

NOVOMATIC GAMING INDUSTRIES GMBH International Sales: Lawrence Levy +43 2252 606 870 756, sales@novomatic.com www.novomatic.com

Asia Gaming Briefings | November 2017

SUPPLIER SPECIAL REPORT 52 Sega Sammy Creation

SPINTEC

S

S

Exciting Baccarat ega Sammy Creation is a gaming manufacturer, established in 2013.

Part of the Sega Sammy Group, the company creates innovative games utilizing the group’s wealth of creativity, entertainment experience and technology.

Sega Sammy Creation recently released its new game “Exciting Baccarat 2”. It provides a special side bet feature which allows players to predict the card total for PLAYER, BANKER or TIE outcomes.

Furthermore, the side bet area(s) can have their odds doubled at random.

With an 84” main screen and five 24” sub monitors both casual and hardcore Baccarat players can’t help but gravitate towards the easily identifiable game trends across 5 independently timed tables designed for fast and immersive gameplay.

Karma electronic roulette

pintec is showcasing its innovative gaming solutions at the Macao Gaming Show this year. The company’s flagship product Karma electronic roulette has been one of the most popular electronic roulettes in Macau.

As a result, Karma roulette has been holding a majority share among all new electronic roulette installations for the past three years in Macau. Spintec has recently installed 50 stand-alone terminals at Genting Malaysia, after beating competition in a trial.

Karma – the ideal compact gaming solution for any floor Karma Sic Bo can be installed as an AUTOMATED, VIRTUAL or LIVE game or in any combination thereof. To elevate enjoyment of the game, Spintec have added visual and audio emphasis to mark the crucial moment of the dice shaking. Karma SicBo is a guarantee for longer gaming sessions.

Karma Roulette can include all of the game features of the Karma Roulette, including the Progressive Jackpot System. You can assign as many playing modules to a Virtual Roulette as you wish.

Aura – the ultimate amphitheatre multigame solution

SUZOHAPP

Forefront of innovation

A

t this year’s MGS SUZOHAPP will proudly introduce its latest innovation - the 27” Pedestal Kiosk, a brand new upright kiosk with a 27” touchscreen display.

Further advanced solutions on display will be the 27” Dual-Sided Display with LED and the Display Pro, featuring a 42” HD screen ideal for visual campaigns.

In the SUZOHAPP booth, significant focus will be placed on the PKT Button Panel. The PKT is the leading-edge technology in tactile controls. Through a patented technology, SUZOHAPP enables its clients to bring dynamic content via a highly configurable user interface. Game designers are no longer limited by the user interface and end users now receive eye-popping content through a tactile button, creating a more rewarding and comforting experience.

Cash management equipment is a prominent offering in the SUZOHAPP portfolio and, at MGS, SUZOHAPP’s strong reputation for cash handling expertise will be on display. Visitors will have the opportunity to see a variety of SCAN COIN desk top solutions, including the SC8220 multi currency counter and the SC-313 coin sorter.

See what SUZOHAPP has to offer at stand A029.

Asia Gaming Briefings | November 2017

Aura amphitheatre multigame solution combines live, automated and virtual games in one multi game experience – Roulette, Baccarat and SicBo/Craps can be played by an endless number of players. As part of a multigame solution a stand-alone multi game wall can be added. Another excellent characteristic is that a stand-alone display can be put in any interior, independent from any back-wall.

“We have installed a substantial number of Electronic Table Games in all six casino groups in Macao. However, winning the trial followed by sales of 50 stand-alone terminals at Genting Malaysia is absolutely something to be proud of,” says Primoz Krsevan, regional sales manager at Spintec. “We have received remarkably positive feedbacks about our gaming solutions from our clients in Macao, where Spintec has been a market leader among all new electronic roulette installations for the past three years,” concludes Krsevan.

Find out more about Spintec’s ETGs at stand AP26.

ExCeL London, UK 6-8 February 2018

SUPPLIER SPECIAL REPORT

A passport to

Clarion launch ICE 2018 P

assport to Paradice is the theme created by the marketing team at Clarion Gaming in support of ICE 2018. The Paradice creative will spearhead another worldwide campaign which will be deployed through digital, print and social media channels reaching an audience of close to 80,000 targets in 200 international jurisdictions.

The decision to go live a full five months ahead of ICE, hosting the biggest and most cosmopolitan gathering of gaming professionals in the world, was taken following feedback from ICE exhibitors who requested a bigger window to showcase their brands more effectively and develop a dialogue with gaming professionals ahead of the event opening at ExCeL London. The ICE registration process features a pre-populated form which provides former attendees with the fastest possible, click-and-confirm registration experience.

Dan Stone, Senior Marketing Manager at Clarion Gaming, said: “ICE has become such an important business event for the entire gaming industry that our exhibitors requested a longer lead time between registration going live and ICE going live. As well as bringing registration forward, we have also invested in the segmentation of news and content by sector and the creation of a zone for visitors to favourite products and content. The Meeting Planner tool, which was requested by visitors and exhibitors alike, will go live during Q4 2017.”

Ampersand - the biggest think tank in gaming C

larion has pledged to create the biggest think tank of advisors and ‘critical friends’ in the history of gaming. Clarion’s target is to enlist the services of 1,000 industry professionals from throughout the world of gaming to help guide the development of its brands and to ensure they continue to serve

the needs of the industry. The progressive initiative, which Clarion has branded A ‘ mpersand’, will comprise a representative cross-section of industry verticals, jurisdictions, job functions and channels. Ampersand was unveiled at WrB London, with Clarion aiming to achieve its target membership by ICE 2018.

Industry professionals who agree to participate in Ampersand will receive a number of benefits in recognition of their time, including entry to the dedicated Ampersand Lounge at the flagship ICE event, as well as access to intelligence reports and surveys produced by the team at Clarion Gaming.

To register and access the 500+ international exhibitors who will be occupying 42,000 sqm of net space at ICE 2018, visit: www.icetotallygaming.com #passporttoparadice

Asia Gaming Briefings | November 2017

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SUPPLIER SPECIAL REPORT 54 TransAct

Print solutions on display

T

ransAct Technologies will demonstrate a full suite of its innovative gaming technology and print solutions at the 2017 Macao Gaming Show.

The company will showcase in a standalone display its unique Epicentral promotion and bonusing software solution – including the fully-featured Epicentral v3.8 version and the unique Epicentral SE systems version – as well as the industry’s most complete lineup of Epic gaming device and lottery printers led by the all-new Epic Edge.

“As a long-term supporter of the casino gaming and lottery industry in Macau, TransAct is delighted to reaffirm our commitment to the market’s world-class operators by demonstrating our unrivaled technology and print solutions

at the 2017 Macao Gaming Show,” said Bart C. Shuldman, chairman and chief executive officer of TransAct Technologies.

“This year marks the first in which we will have our own standalone presence at the Venetian Macau, allowing our team to interact directly with customers as we detail how our solutions lineup provides players with an engaging and seamless gaming experience. Customers visiting our booth will see TransAct’s two unique versions of Epicentral which are delivering casino revenue growth’ worldwide along with our proven lineup of Epic gaming device printers. The entire TransAct team is excited to work with our customers at the show to deliver our unmatched customer

Zitro

Blazing Pearls

D

uring the Macao Gaming Show Zitro will be presenting to the Asian market the new addition to the Bryke Video Slot product line: Blazing Pearls, a multigame local area progressive link.

Blazing Pearls had its worldwide debut at the recent Global Gaming Expo in Las Vegas and as Nadège Teyssedre, sales manager for the region explains: “We could not be more proud as to how Zitro’s Video Slot Brand Bryke is consolidating as a prestige brand in the global gaming industry. It is only 12 months ago that Zitro started commercializing Bryke, and by now we can confirm that the performance worldwide is more than satisfying.

Blazing Pearls, as well as any other Bryke product, is available in both, Fusion upright and Fusion Slant Cabinets. The Fusion cabinets stand out thanks to their combination of cutting-edge technology and beautiful ultra slim design that will mark the difference on any casino floor. With the increasing Bryke game library including progressive links such as Blazing Pearls, we are now ready to provide a very competitive video slot product portfolio to our customers.”

Sebastián Salat, CEO of Zitro adds: “The whole Asian region is a key region within our worldwide expansion plans.

With our presence at MGS and the launch of Blazing Pearls we are demonstrating to our customers the commitment we have with the Asian market, and we are in the position to guarantee a continued flow of new games in order to secure and increase our footprint.”

While at MGS, Zitro will be presenting new Video Bingo games on the popular Blackwave cabinet. Zitro has also recently released a wide portfolio of amazing games available for the Fusion Slant 27/23 cabinet, that have been extremely well received by the Video Bingo operators worldwide, and that are now available to the Asian operators.

Find Zitro at MGS at stand AJ38.

Asia Gaming Briefings | November 2017

service and demonstrate the fruits of our continued innovation.”

Epicentral is the gaming industry’s only solution that is delivering casino revenue growth by providing operators with the capability to target and provide printed bonuses in real-time. TransAct will highlight its two unique configurations of this unmatched software-driven offering – Epicentral v3.8 and Epicentral SE – at the 2017 Macao Gaming Show and demonstrate to customers of all sizes how they can easily realize the benefits of increased customer visitation and play.

For more information about Epicentral and the company’s complete lineup of Epic series of gaming and lottery printers, go to stand AF26 at the show.

55

Asia Gaming Briefings | November 2017

CALENDAR OF EVENTS 56

2018

NOVEMBER SIGMA 22-25 November 2017 Malta Fairs & Conventions Centre https://maltaigamingsummit.com/ Public Venues & Events Safety & Security 27-29 November 2017 Macau http://publicvenueseventssafetysecuritylse.marcusevans. com/

DECEMBER SBC AWARDS 5 December 2017 London, U.K www.sbcevents.co.uk Affiliate World Conference - Asia 6-7 December 2017 Bangkok, Thailand https://affiliateworldconferences.com/asia/tickets/ World Gaming Expo 6-8 December 2017 Grimaldi Forum, Monaco http://world-gaming-expo.com/

february International Casino Exhibition (ICE) 6-8 February 2018 ExCel Centre, London, U.K http://www.icetotallygaming.com/ Sports betting and gaming India conference 27-28 February 2018 Goa, India www.sportsbettingevents.com/background-india.html

MARCH

Asia Amusement & Attractions Expo (AAA) 3-5 April 2018 Guangzhou, China http://www.aaaexpos.com

MAY G2E Asia 2018 15-17 May 2018 The Venetian, Macau https://www.g2easia.com/

JULY

IMGL 2018 Spring Conference 7-9 March 2018 Las Vegas, Nevada https://www.imgl.org/conferences/spring/overview/2018

World Gaming Executive Summit 3-5 July 2018 W Hotel, Barcelona http://www.terrapinn.com/conference/world-gamingexecutive-summit/agenda.stm

iGaming Asia Congress 13-15 March 2018 Macau https://igamingasiacongress.com/

iGaming Super Show 17-20 July 2018 Amsterdam http://www.igamingsupershow.com/

ASEAN Gaming Summit 2018 20-22 March 2018 Conrad Manila, Philippines www.aseangaming.com

Become a member Exclusive access to AGB Intelligence BE the first to receive our daily briefs priority registration for our events REGISTER NOW AT AGBRIEF.COM

Asia Gaming Briefings | November 2017

APRIL

AUGUST Australia Gaming Expo 14-16 August 2018 ICC Darling Harbour, Sydney https://10times.com/australasian-gaming-expo

57

Asia Gaming Briefings | November 2017

LAST WORD 58

Sharon Singleton

Managing Editor, AGB

Security under spotlight as attacks, typhoons take toll Asia’s multi-billion dollar casino resorts have enjoyed a solid year in 2017, with gross gambling revenue staging a strong recovery in Macau and continuing to gain in the Philippines, but despite their size and grandeur, events this year revealed gaping holes in preparedness.

S

ecurity consultants in Asia have been warning security at their sprawling resorts, which unlike the for some time that the region’s casinos may Philippines have no entrance controls. The operators present a soft target for any terrorist group will now be required to install metal detectors and ban luggage from casino floors. Staff will also be seeking to make a statement.

This year, the warning played out with a deadly given further training to detect suspicious behaviour.

However, it wasn’t a security incident that revealed attack in the Philippines in June, when a lone gunman stormed into Resorts World Manila, setting fire Macau’s underlying weakness. It was Typhoon Hato that to casino tables. A total of 37 staff and clients lost served to unmask the pitiful state of the infrastructure their lives, mostly from smoke inhalation, while the that underpins the world’s biggest gambling hub. The category 10 storm hit in August, causing at least 10 gunman took his own life.

The perpetrator turned out to be a problem gambler deaths and widespread devastation.

More than half of the population was left without and not a terrorist, but the distinction is probably irrelevant given the loss of life and scale of destruction. power and many lost water for days after the flooding of a key supply facility. Local Fingers were swiftly pointed authorities showed they were at security lapses, with tales woefully underprepared, of security guards fleeing starting from the delays in the scene and a failure It was Typhoon raising the typhoon warning to evacuate the burning Hato that served signal to give people chance second floor leading to the to prepare, through to high loss of life. This was in to unmask the clearing the streets of debris part because authorities had pitiful state of the in the aftermath. China’s not managed to locate the People’s Liberation Army gunman, despite the multiple infrastructure soldiers, normally confined CCTV cameras peppered that underpins the to barracks in Macau, were throughout the casino. world’s biggest out on the streets for the first Questions were also time since the handover to raised as to why there was gambling hub. provide assistance. not a more heightened The six operators also state of alert in the capital’s stepped up to the plate, entertainment venues, given the battles raging in the south against Islamic militants. pledging both financial and physical assistance to Market regulator, the Philippine Amusement get basic infrastructure up and running again in a and Gaming Corp. announced an investigation into territory that ranks among the top five globally in security following the attack, while independently terms of gross domestic product per capita.

It remains to be seen whether legislators will the operators beefed up security measures.

However, for the Philippines it was a lesson respond to popular anger and finally push through learned the hard way. As a destination it could ill long-stalled infrastructure projects to improve daily afford the negative publicity surrounding security, as life both for locals and visiting tourists. Traffic jams, it has long had an image problem, especially among virtually non-existent public transport and a terrible taxi service are just a few of the criticisms levelled key Chinese gamblers.

Since the attack and the deadly shooting in Las by travellers to the glitzy resorts.

Without considerable change, it will be hard for the Vegas that killed 58, Macau’s operators have been working with authorities and regulators to improve city to promote itself as a world tourism destination.

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Asia Gaming Briefings | November 2017

CONTACT YOUR SG GAMING SALES REPRESENTATIVE NOW MACAU OFFICE Phone: +853 2872 2539 www.sggaming.com/asia