AGBriefings November 2015

JURISDICTION UPDATES November 2015 Edition

MACAU

Failing to fizz pg.06

AGB Advisors look into 2016 underlying trends

END OF THE IR ‘ARMS RACE’ pg. 28

RUSSIA

Looking into a Cristal ball pg.12

CAMBODIA

Asia’s bright spot pg.24

AUSTRALIA

Taking aim online pg.36

MGS 2015 SUPPLIER SPECIAL pg.40

MESSAGE 3

Viva Macau!

T

he world is changing; Mainland China is

In these pages you’ll also find a Supplier Special

changing; and Macau is now faced with changes

Report dedicated to the Macao Gaming Show.

it was never remotely prepared to undertake.

Organized by the Macau Gaming Equipment

The concept of “recovery” doesn’t seem to

Manufacturers Association, the exhibition features

apply any longer as the market is unlikely to go back

a floor area of over 10,000 meters sq. where major

to its golden ages. The year ahead is undoubtedly filled

suppliers are showcasing their best and latest. The

with challenges for local stakeholders, including policy

MGS show covers six gaming industry segments,

makers, operators and suppliers as the industry adapts to

including gaming equipment and accessories, gaming

a new norm - which has yet to reveal itself.

promoter and VIP clubs, casino fixtures and fittings

Despite all the doom and gloom, the downturn and

and F&B.

crackdown, Macau still remains the epicenter of

In turn, the event’s Summit is set to provide a

gaming in Asia but, as the market develops, the need

varied perspective on the region with the speaker

for transparency, sensible policy, and long term

list drawing on the experience of senior Chinese and

vision is imperative to develop a sustainable version

Macau figureheads, alongside leading players from the

of the sector.

international industry.

Asia Gaming Brief asked its advisors David Green, John

Lastly, AGB will be hosting the Official MGS Networking

English, Luis Mesquita de Melo, Andrew Klebanow and

Party at Spirito Bar, Portofino on the evening of

Steve Gallaway, to look ahead and share with us what

Tuesday November 17. With a host of supporters

they believe are the underlying currents for the Asian

including MGS, Betsoft Gaming, Aristocrat, Bulls

Gaming industry in 2016. Views may differ but the one

Eye Services, Every Matrix, Paltronics, Play’n GO and

common denominator is the shifting of the sands -

Transact Technologies, it’s sure to be the highlight of

something will have to give…

the week again.

In this edition of AGBriefings we also bring you the

As always, we look forward to connecting with you at

latest updates and developments across the different

one or other event, or remember to stay up to date with

Asian jurisdictions. Looking at Greater China we

all the developments by following us on social media.

examine opportunities in lotteries in Mainland

If you would like to book a meeting with us while in

China. In South East Asia, MBS Singapore delivers a

town for the MGS write to us at MGS@agbrief.com

surprisingly positive 15Q3, but the Philippines seems

or look for us at the floor. AGB will be exhibiting at

to have temporarily lost its lustre for analysts. In

booth #W23. l

Vietnam, a study underlines the potential GDP boost casinos would bring the country. In North Asia, the MERS outbreak highlights the risk of tourism dependency for Korean casinos, while Japan’s casino

@agbrief

Rosalind Wade

Luis Pereira

Asia Gaming Brief

Asia Gaming Brief

bill is held up by gambling addiction concerns. Down

On behalf of Asia Gaming Brief

under in Australasia, Best Sunshine aims for the

Rosalind Wade & Luis Pereira

world’s most luxurious resort, and New Zealand reviews

PUBLISHERS

its gambling act amid concern over falling revenue.

www.agbrief.com NOVEMBER 2015 EDITION SERIES II • ISSUE X

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Asia Gaming Briefings | November 2015

CONTENTS 4

GREATER CHINA

SOUTH EAST ASIA

06

MACAU

10

MAINLAND CHINA

MALAYSIA

SOUTH ASIA

18

PHILIPPINES

20

SINGAPORE

22

INDOCHINA

NORTH ASIA

27

INDIA

AUSTRALASIA

RUSSIA

12

CAMBODIA

24

AUSTRALIA

36

JAPAN

14

VIETNAM

26

NEW ZEALAND

38

SOUTH KOREA

16

PACIFIC ISLES

39

SPECIAL FOCUS

28

SUPPLIER SPECIAL REPORT

40

LAST WORD

Event Organizer

Event Organizer Event Co-Organizer

Event Co-Organizer

Asia Gaming Briefings | November 2015

54

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GREATER CHINA 6

MACAU

Bursting stock bubble adds no fizz to Macau GGR When the mainland Chinese government’s anti-graft campaign began to bite into Macau’s gaming revenue last year, many analysts suggested the big players had fled to safer ground in the thenbooming Chinese stock market.

Asia Gaming Briefings | November 2015

B

ut that bubble has now burst, with the

A quick look at the numbers shows the extent of

Shanghai Composite Index seeing its

that bubble. Although the market’s decline since

worst daily fall in eight years in August,

June has been spectacular, with the Shanghai

sending shockwaves through global

Index having lost a third of its value, it is still

bourses. If that boom is now well and truly

up by more than 40 percent from the same

over, is there any argument for a corresponding

period last year, according to Bloomberg figures.

turnaround in Macau?

Deutsche Bank analyst Karen Tang agrees

A recent report from Macquarie Capital Securities

there is a strong relationship between stocks

didn’t contain much reason for optimism, stating

and GGR, estimating a 70 percent correlation

most experts couldn’t say whether Macau’s

between the Shanghai A-share market with

Gross Gaming Revenue (GGR) would recover,

Macau’s VIP gaming revenue.

plateau or continue to plummet.

However, a leading analyst has warned not to

“Over the past two months, we met with over

expect VIPs to flock back to the Cotai Strip’s

two dozen industry participants and nobody had

embattled casinos and claims, despite what

clear visibility on where GGR would head a month

many other analysts say, that there is at best

out. Even for gaming operators themselves,

a “tenuous” link between China’s market

visibility can be as low as just one week,” wrote

movements and Macau’s still-plunging gaming

analysts Kai Tan, Maggie Jiang and Jensen Hui.

revenue.

“We believe the desired GGR recovery is not

“The first thing to talk about with Macau gaming

happening in the fourth quarter 2015, albeit

revenue is that the link between movements

[GGR] is declining at a slower rate of -27 percent

in the Chinese Stock Markets and the wealth

year-on-year versus -37 percent year-on-year

effects in other markets is very tenuous,” said

in the eight months of calendar year 2015.”

the Economist’s regional editor for Asia, Duncan

The Macquarie analysts did, however, find a

Innes-Ker, who has been analyzing China for

perceived link between share markets and GGR.

more than a decade.

“We expect the recent overshoot of Macau GGR

Investing on the stock exchange may be just seen

decline to reverse in the next couple of months.

as a different type of gambling, but Innes-Ker

The [Macau] performance discrepancy since

suggests that the high-roller casino customer

July 2014 seems to coincide with the overheated

isn’t necessarily the type to be having a flutter

A-share market during the period; i.e., affluent

on margins as an alternative to baccarat or poker.

SME [small- and medium-sized enterprise]

“The bigger factor in Macau is the anti-graft

owners spent more money investing in the

campaign from the Mainland and the immediate

A-share market rather than visiting Macau.”

impact of that, as regulators began to crackdown

GREATER CHINA 7 and the VIP high-roller, is that they basically didn’t turn up in the same sort of numbers they used to,” he said, adding that the claim that VIPs turned to the surging markets at that time may also be off the mark.

“You can’t have your cake and eat it too,” he said. “If revenue is falling by 30 percent in the last quarter of 2014 because people are investing money in the stock exchange – you can’t then turn around and look at September 2015 numbers falling at 33 per cent and say that’s because of the impact of what is going on in the Chinese stock market.

“Arguably there is a position to take that people with money to spend within China – wealthy people with investment cash, that they did channel a large amount of that into the stock market during the boom time and that did have an impact on the domestic housing sector, for instance, but in terms of its impact on the gambling sector in Macau, the effects are very much secondary to what is going on with the

to a record high of more than HK$100 billion ($12.9 billion) in 2013-14, climbing again to

GROSS GAMING REVENUE

$107.9 billion in the season ending in July.

Y14 $44b

However, the first meeting this season saw

-2.6%

only a slight rise in turnover compared to the corresponding fixture 12-months earlier – a hold of HK$1.1 billion on 10 races, up 1 percent on last year - that figure was also helped by

Oct. -28.4%

commingled betting from overseas jurisdictions that hadn’t been on board in the previous year.

Commingled bets from New South Wales were added to the pools this week and will be sorely needed, along with simulcast betting, to boost the flat figures. A comparison of turnover from the first 13 meetings of the 83 meeting season

Y15E UBS

-34% -33% to -34%

Fitch

-32%

shows a slight drop in Pari-mutuel betting. In

Maybank Y16E

2014 it had reached $14.93 billion 13 meetings

UBS

in and 12-months later is $14.88 billion.

Back in Macau – with the VIPs gone – there

+2%

Y17E

doesn’t look to be much light at the end of a

UBS

tunnel that has now grown into 17-straight

+10%

months of declining revenue.

anti-graft campaign.”

Other analysts have also argued that any correlation may be more on the downside than

OPERATORS

the up, with the fall in stocks hitting the personal wealth of the SME owners, making them less likely to take a flutter in Macau.

There does, however, appear to be a link between the stock market and Hong Kong Jockey Club betting numbers – so much so that some pundits are calling the HKJC numbers the new “Big Mac Index” - referring to the famous index created

by The Economist that measures a country’s economic strength by the comparative cost of a hamburger.

The only flat spot on what has been a steep rise in turnover in the last decade coincided with the 2008 Global Financial Crisis – when turnover failed to grow on the previous season, something that could happen again this term if early figures are any indication.

Hong Kong Jockey Club chief executive Winfried Engelbrecht-Bresges says totalizator holds have been “resilient”, although the numbers may not be so pretty once you scratch beneath the surface.

The Jockey Club’s handle has taken a body blow – most of the stock market losses occurred during racing’s summer break and there were bleak forecasts from some officials when racing returned on September 6.

The Jockey Club does not entertain junket operators or offer credit betting and it is an approach that has paid off until now, with betting numbers being somewhat immune to the anti-graft measures. The figures have

MARKET SHARE AS OF OCT. 18TH 2015

SJM HOLDINGS (880:HK)

Holds a 20.5 percent market share as of Oct. with 20 casinos. Its $3.2 billion Palazzo Versace development is scheduled to come online in 2017.

Mass market property the Jal Alai is scheduled for a mid-2016 opening with 130 rooms and 45 gaming tables. The company has also indicated it may be interested in opportunities in Japan.

The company is currently building The Lisboa Palace on Cotai, which is also scheduled for completion in 2017. The casino plans are for 700 gaming tables and over 1,200 slot machines

GALAXY ENTERTAINMENT 25.4% LAS VEGAS SANDS 24.1% SJM HOLDINGS 20.5%

across a gaming floor area of approximately

MELCO CROWN ENTERTAINMENT 13.9%

27,000 square metres. The total production

WYNN RESORTS 8.1%

cost is estimated at about HKD$30 billion ($3.8

MGM RESORTS 7.9%

billion), although the company has expressed concern over costs.

(Source: Wells Fargo)

SJM Holdings reported a 37.9 percent drop in gaming revenue to HK$11.24 billion ($1.45 billion) in 15Q3 compared to the same period the year before. Adjusted EBITDA during the period decreased by 49.5 percent from 14Q3 to HK$884 million and for the nine months ended September 30 decreased 49.2 percent to HK$3.14 billion.

Profit attributable to the owners decreased by 81.4 percent to HK$285 million and for the nine months decreased by 61.8 percent to HK$2.07 billion.

risen year-on-year for the last seven seasons

Asia Gaming Briefings | November 2015

GREATER CHINA 8

GALAXY ENTERTAINMENT

MELCO CROWN

Table games turnover in the VIP segment was

GROUP (27.HK)

ENTERTAINMENT (6883.HK)

the number of VIP tables also declined during

Has three casinos and a 13.3 percent market

year’s period.

properties. The company’s new Galaxy Macau

share. The company’s $3.2 billion Studio City

Wynn said it expects to open the resort in the

Phase 2 and Broadway at Galaxy Macau opened

opened on October 27, 2015, with an allocation of

first half of 2016.

on May 27 this year, almost doubling the capacity

250 tables, short of the 400 requested. All

During the third quarter of 2015, it invested

of the resort. The group was recently granted

tables were allocated to the mass sector, a

approximately $434.9 million in the Cotai

an extra 100 tables, adding to the original

first in Macau. The resort features a 5,000-seat

project, taking the total investment to $3.1

allocation of 150 tables. That’s still far short

multi-purpose theatre, a permanent magic

billion through September 30, 2015.

of the 400 it had requested, but brings it in

show, jungle-themed river rides, Asia’s highest

line with the table award given to Melco Crown

Ferris wheel and a Batman simulated ride. Melco

Entertainment’s Studio City.

says the resort will be made up of 95 percent

In the latter part of 2015, the company expects to

non-gaming components.

begin site investigation works for Cotai Phases 3

The company has warned in the past that a lower

and 4, the plans for which are almost complete.

table allocation than requested may put it in

a single casino in the peninsula. Its new

The company is also expected to break ground

breach of covenants with its lenders.

developments include the MGM Cotai, which is

on its hotel on Hengqin Island this year. Galaxy

The group said it intends to proactively engage

a $2.9 billion project scheduled for completion

is planning a “Maldives-style” resort.

the lenders under its senior credit facilities to

mid 2016.

The group posted 3Q revenue of $12.3 billion

discuss proposed amendments to the terms of

MGM China earned net revenue of $529 million,

and adjusted EBITDA of $2.1 billion in 15Q3,

its loan documentation to reflect the number

a 33 percent decrease compared to the prior

year-on-year declines of 29 percent and 36

of tables allocated.

year quarter. Main floor table games revenue

percent respectively.

CLSA analysts said they expected the property

decreased 30 percent compared to the prior year

Analysts have said the addition of Galaxy Macau

to grow the market, unlike Galaxy Phase 2 which

quarter, while VIP revenue dropped 39 percent.

Phase 2 hasn’t significantly boosted revenue.

largely cannibalized existing casinos. They

Property level EBITDA came in at $128 million

Though the group does claim success in shifting

forecast MPEL’s overall market share to grow

versus Deutsche Bank’s $118 million estimate

focus to the mass market. It says revenue from

from 13.6 percent in 2Q15 to 16.4 percent in

and the StreetAccount consensus of $124.4

the mass market has risen to about half of the

2Q16 before falling back to 15.3 percent in 3Q16.

million.

total, compared with one third in the same

In 3Q, adjusted net income per ADS was $0.11

MGM said its new Cotai project remains on track

period last year.

down from $0.28, beating forecasts by a penny,

to open in the fourth quarter of 2016. It said it

according to Capital IQ.

has reached a milestone with the topping off

Adjusted property EBITDA of $237 million was

of its hotel towers. l

Has a 24.2 percent market share with eight

SANDS CHINA (1928:HK)

above consensus of $202 million, though for

Has a market share of about 24 percent and

came in below the Street’s $217 million.

has four casinos. Analysts say the company

Net revenue dropped 16% to $945.7 million,

has had a lower room occupancy than rivals

missing the average estimate of $958.1 million.

revenue growth if it fills the rooms. The billion The Parisian, which is now expected to come online in late-2016. Sands China also

WYNN MACAU (1128:HK)

Has an 8.2 percent market share and currently

recently expanded retail space at its Sands Cotai

has one casino, while its $4 billion Wynn Palace

central property, with the addition of 150,000

is under development and scheduled to open

square feet of space, with shops designed to

in the first half of next year, with 1,700 hotel

appeal to families.

rooms. Chairman Steve Wynn says 90 percent

Net revenues for Sands China decreased 28.8

of the resort will be non-gaming. Wynn recently

percent in 3Q to $1.66 billion with adjusted

was reprimanded by the Macau government for

property EBITDA down 32.8 percent to $545.0

comments he made criticizing policy, especially

million. Net income decreased 46.8 percent to

over table allocation.

$343.2 million.

The company said the resort will feature a

The Venetian Macau saw a 9 percent occupancy

performance lake, casino, spa, retail and other

drop in the quarter and 20 percent drop in

outlets. It is aiming for about 500 table games.

revenue per available room, and Sands Cotai

In Q3 Macau net revenues were $585.1 million,

Central saw a 17 percent RevPAR drop YoY.

down from $942.3 million a year earlier, while adjusted property EBITDA tumbled by half to $162.8 million.

Asia Gaming Briefings | November 2015

the period to 228 units from 251 in the prior

MGM CHINA (2282:HK)

Has a 15.1 percent market share while operating

Macau alone adjusted EBITDA of $213 million

in Cotai, meaning it has more potential for company’s new developments include the $3

$12.2 billion, a 51.3 percent decrease, though

Macau’s health department is forecasting that gross gaming revenue will decline 2.7 percent to 4.6 percent in the event of a total smoking ban in Macau. The legislature has postponed the smoking bill until next year due to time constraints.

Macau’s gaming regulator, the DICJ, plans to revise junket regulation “as soon as possible.”

The DICJ said its main focus will be on oversight and audit of junket promoters. Specifically, it will look at introducing additional requirements on junket promoter’s capital, shareholders, guarantee deposits, financial reporting and auditing.

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GREATER CHINA 10

GROSS GAMING REVENUE

MAINLAND CHINA

Y14 Total sales RMB 382.38b ($61.6b)

+23.6%

Welfare Lottery Sales RMB 203.96b

+16.7%

Sports Lottery sales RMB 176.4b

+32.8%

August sales RMB 28.09b

-10.9%

Welfare lottery

-11.8%

Sports lottery Jan-Aug. sales RMB 242.82b

China moves to boost efficiency of lottery system, no lifting of online ban yet China’s State Council has taken steps to improve the efficiency of the country’s lottery system, though has not yet taken action to lift a ban on online and mobile sales.

I

n October, the council took action to reduce

However, one industry insider told AGB that

the amount of time required for the approval

the relaxation may not be as significant as

and administration of lottery sales and pay-

some have suggested, pointing out that it only

outs by cancelling 62 central authorization

applies to existing games and not new products,

requirements and devolving responsibility to

which will still require central Ministry of

provincial finance departments.

Finance approval.

U.K.-listed lottery company DJI Holdings

DJI, also in October, announced that its Qingdao

welcomed the move, saying it will allow greater

Baifa Network Science Technology Service

innovation in game development and drive

joint venture had been given permission to

greater demand from players.

commence a trial of sales of Sports Lottery

“We are pleased to see the first major policy

products via mobile phones in Qingdao City

change for China’s lottery industry since online

in Shandong Province.

sales were suspended in March and we view this as

The joint venture’s mobile app provides access

significant progress towards the announcement

to a number of Sports Lottery games including

of new regulation and the recommencement of

Big Lotto, China’s most popular Sports Lottery

sales. It is clear that the internet is recognised as

draw game, ten different digital scratch cards

an important channel for the lottery,” said CEO

and sports betting games Jingcai and Zucai.

Darren Mercer. “Reducing the length of approval

China’s decision to suspend online lottery sales

and administrative processes for operators,

has hit profits at companies operating in the

while allowing provincial lottery centres more

sector. 1H net revenue at DJI Holdings fell to

flexibility in determining their own lottery sales

GBP2.1 million ($3.2 million), down from GBP3.4

and pay-out structures, is a great step forward.”

million in the same period the prior year.

DJI added that the new regulation was a tangible

Rival 500.com said it had no revenue in 2Q

sign that steps are being taken to lift the online

compared with RMB156.1 million ($24.6 million)

ban, which was implemented to root out illegal

for the second quarter of 2014 and posted an

operators in the market.

operating loss. l

Asia Gaming Briefings | November 2015

-9.9% -1.8%

China’s State Administration for Foreign Exchange (SAFE) announced new annual limits on UnionPay cash withdrawals outside of China, an indication that the country is concerned about capital outflow. The new annual limit has been set at RMB100,000 ($15,700) per card for 2016 (and RMB 50,000 for the remainder of 2015).

Guangzhou Lottnal Terminal Company, a subsidiary of China LotSynergy Holdings Ltd, has won bids to supply the Heilongjiang and Guangxi Sports Lotteries, giving the company a 30 percent market share of this year’s total Sports Lottery terminal procurement volume nationwide.

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NORTH ASIA 12

RUSSIA

Will Tigre de Cristal add sparkle to Russia’s gaming industry?

The first casino in Russia’s Far East, which has been touted as a potential Macau of the north, has officially opened after lengthy delays.

Asia Gaming Briefings | November 2015

T

he Tigre de Cristal held its soft launch

is expected to appeal mainly to travellers from

on Oct. 8th in the Primorye gaming

northern China and Korea, although unlike in

zone near the city of Vladivostok. The

many other Asian countries locals will also be

opening of what is Russia’s biggest

able to participate. About 300 million people

casino was attended by about 1,000 guests.

live within a three-hour flight of Vladivostok.

It will have its grand opening ceremony on

“Money from China is flowing to this gaming

November 12th.

zone. It will be also operated primarily by the

“We are certain that implementation of this

Chinese. They have Macau in the south and

project will attract additional investments to

Vladivostok in the north,” Russian gaming

all spheres of tourism in Primorye Territory and

expert Samoil Binder said.

the Integrated Entertainment Zone. Primorye

The first phase of Tigre de Cristal involves 121

will become a world-level holiday destination

hotel rooms, seven restaurants and bars and

and attract visitors from all APR regions,” Craig

two main gaming floors, with a capital budget

Ballantyne, CEO of developer G1, was cited as

of $172 million. It features 42 mass market

saying at the event.

tables, 759 slot machines and electronic table

The debut of the casino has been postponed

games, and 25 VIP tables.

multiple times since 2011, but the pace of

The current estimated expenditure for the second

development picked up when Asian investors

phase, set to open in 2018 and comprising a

became involved in the project in 2013. The resort

further 100 VIP tables, 70 mass market tables

NORTH ASIA 13

GROSS GAMING REVENUE

and 500 slot machines, as well as a total of 500

foreign suppliers rather than to purchase them

hotel rooms, is $500 million.

in Vladivostok, the local information agency

The companies behind the casino are Summit

Vladivostok Daily News reported.

Ascent controlled by billionaire Lawrence Ho,

Miklushevskiy has said the region stands to

Melco Crown Entertainment Ltd, which Ho also

benefit from about 1 billion roubles in taxes

co-chairs, and G1 Entertainment LLC, formerly

from gaming activities. Binder reckons the

known as First Gambling Company of the East,

target is realistic. “It is enough to have a casino

PRIMORYE Y16E $410m Y20E $1.7b NAGACORP RUSSIA Y20E EBITDA $220m

a majority-owned subsidiary of Summit Ascent.

with 100 working gaming tables and 500 slot

Tigre de Cristal is the first of four resorts

machines, several restaurants, a nightclub, a

(Source: Citi)

scheduled to open in the Primorye Integrated

hotel and other infrastructure,” he said.

Entertainment Zone (IEZ), which will be

According to Binder, if the quality of infrastructure

constructed in three stages until 2022. The zone

and transport connections is improved, Primorye

is situated on the Muravyinaya Bay just 50km

may be of interest for Chinese VIP players,

from Vladivostok and covers an area of about

who are shunning Macau to avoid coming

620 hectares. In addition to eight casinos, the

on to Beijing’s radar amid its ongoing anti-

zone will feature multiple hotels, ranging from

corruption drive.

three-star to seven-star, as well as a yacht club.

In February, a consortium led by Singapore’s

Global Market Advisors estimates that the

Changi Airports International was announced

Vladivostok area gaming market will reach $1.2

as the winner of the tender to acquire shares in

billion in its third year of operation, and $5.2

Vladivostok International Airport. Since then

billion in its tenth year, according to figures

more flights have been introduced, with the

cited by Forbes. That would make it one of the

number in October reaching up to 30 per day,

world’s top four gaming destinations, behind

both external and internal.

Macau, Las Vegas and Singapore.

Primorye IEZ will become the third functioning

The launch of the first casino in Primorye comes

gambling zone in Russia and the only one

just ahead of the introduction of a simplified

which is Asian facing. It is also the one which

visa regime in the region (12 October), which

has attracted the most foreign investment at

will allow foreigners to stay for a period of up

more than $2 billion.

to eight days. Primorye Territory Governor

In addition to Tigre de Cristal three other projects

Vladimir Mikhushevskiy recently said the

have been authorized by the local authorities,

tourism flow to Primorye doubled in the first

and at least two of them have begun work.

half of 2015 compared to the previous year,

NagaCorp Russia, a unit of Hong Kong-listed

with the majority coming from neighbouring

NagaCorp, broke ground on its resort in May

Asian countries.

this year, having selected China Harbour

In the beginning of 2016, a road linking the

Corporation as its contractor.

Muravyinaya Bay and Vladivostok airport is

The first phase will include a casino hotel

expected be put into service, allowing access

complex with 100 gaming tables and 500

to the casino in 10 to 15 minutes instead of the

gaming machines and is expected to receive

current 40 minutes. The regional government

its first guests at the latest in 2018. All three

injected some 800 million roubles ($12.6

stages of the resort are due to be completed by

million at the current exchange rate) into the

2021, with a total investment of $350 million.

infrastructure.

NagaCorp CEO Chen Lip Keong recently told

Russia’s gambling taxes are much lower than

local media that one of the reasons for choosing

in Asian countries, which is seen as a major

Vladivostok was that it’s “a European city in

draw for operators: a levy per slot machine per

Asia. And every Asian man dreams about visiting

month is just 7,500 roubles ($120) and per table

a European city which is situated so near.”

125,000 roubles (about $2,000). Compare that

Russian company Diamond Fortune Holdings

with Macau, which levies an effective tax rate

Ltd announced in early July that work had begun

of 39 percent on casino gross gaming revenue,

on its Selena World Resort. The total amount of

whereas Singapore’s effective rate varies from

investment into the project is expected to reach

12 to 22 percent of gaming revenues.

$913.7 million. Diamond Fortune CEO Georgiy

Despite the low taxes, Vladivostok does not

Kondakov said at the recent Eastern Economic

necessarily offer a low cost structure.

Forum in Vladivostok that his company’s project

Stelianos Tsifetakis, vice president of Hotel

is aimed at tourists with different interests,

and Catering Operations at G1 Entertainment,

“not only gamers.”

recently complained of high prices and the

He also noted some problems with infrastructure

unsatisfactory quality of goods needed for

as part of the territory for construction is

Tigre de Crystal, making it necessary to turn to

situated in the forest. l

EXPECTED JUNKET COMMISSIONS PRIMORYE 1.7% (Source: Citi)

TAX RATE: RUB125,000/gaming table and RUB2,500/slot per month The launch of the Yantarnaya (Amberland) gaming zone in Russia’s westernmost Kaliningrad region has been postponed until the summer of 2016, according to the Vedomosti newspaper.

Citing a representative of Royal Time Management, a subsidiary of the project’s investment company, Royal Time Group, the newspaper said the delay is due to the slumping rouble.

Russia’s state internet monitoring agency has stepped up its efforts to ban online gambling, recently blocking popular sites 888 Poker and Ladbrokes. The blocking began in late September and also includes Betway, Bwin. party, JackpotCity, Ladbrokes, Marathon Bet, Pinnacle Sports, Titan Poker and Unibet.

Asia Gaming Briefings | November 2015

NORTH ASIA 14

JAPAN

CASINO GGR ESTIMATES

Casino bill held up by gambling addiction concerns

GGRE $6b

In a quiet neighborhood in Yokohama, Japan, about twenty senior citizens gather each day in a facility called Day Service Las Vegas. For hours on end they play at card games, mahjong, slot machines, and pachinko. At first glance this may look like an illicit casino patronized exclusively by the elderly, but on closer inspection the 10,000 yen bills that change hands are not Japanese currency at all, but rather the equivalent of Monopoly money. No one’s wagers make them any richer or poorer. The top winner of the day simply gets their photograph posted on the wall and the losers are equally as happy to have spent an enjoyable day with their friends.

A

(Source: Fitch based on two major IRs)

PACHINKO ANNUAL REVENUE $153b (Source: Japan Productivity Center)

Japanese billionaire Kazuo Okada will have to travel to the U.S. to face questioning over events leading to his ousting from Wynn Resorts’ board after failing to overturn a Nevada court order.

The U.S. Justice Department started an investigation into whether he used a Universal subsidiary in Nevada to funnel illegal payments to gaming officials in the Philippines where he’s building a casino resort.

lthough the concept that lay behind

views the bill as important, but it is not his top

this facility was inspired by a visit by

priority. If something else emerges that he sees

the company’s president to the real

as truly necessary to address, the Casino Bill

Las Vegas in Nevada, the purpose of

may continually be delayed.” Kakizawa adds

Day Service Las Vegas is to brighten the lives of

that the biggest factor holding up passage of the

elderly and infirm Japanese who might otherwise

legislation is the lack of consensus about this

live in isolation within their own homes. It

issue within the ruling coalition. In particular,

provides them with a community of friends,

the coalition Komeito Party seems unlikely to

physical exercise, and mental stimulation to

drop their opposition to the bill.

keep them healthy and alert.

Representative Kakizawa feels that the repeated

Kaoru Mori, president of the company that

delays in the passage of the enabling legislation

established Day Service Las Vegas, contends, “The

are having a serious adverse effect on international

first step toward health care is to get them out

investors, whom he believes are gradually losing

of their houses. There are many cases of people

their passion to enter the Japanese market and

who won’t even leave their rooms. So we have

to establish integrated resorts. There is no longer

to think about how to bring them outdoors. It’s

much faith that Japan will overcome its cultural

best that they decide for themselves to go out,

conservatism and pass the bill.

and I believe that everyone enjoys a casino.”

Noriko Tanaka is the charismatic leader of The

But in contemporary Japan, even the apparently

Society Concerned about Gambling Addiction, a

Noriko Tanaka calls for a comprehensive and

harmless form of “casino” represented by Day

citizens’ group which includes about three hundred

serious public policy toward gambling addiction,

Service Las Vegas is viewed as controversial.

mostly female members across the country.

which would include enforcement of rules to

Some people speculate that it could open the

Somewhat counterintuitively, Ms. Tanaka says

keep minors out of pachinko parlors, widespread

door to a serious form of gambling addiction.

that she is not an absolute opponent of the

public education about the dangers and the signs

These fears weigh heavily in the opinion polls

Casino Bill and might find it acceptable under

of gambling addiction, and a robust expansion

showing that the Japanese public is cold toward

some circumstances. She strongly believes,

of knowledge and access to care facilities for

the idea of passing the Bill for the Promotion

however, that Japan has done a poor job dealing

those who have been identified by their families

of Integrated Resort Facilities, known popularly

with serious problems relating to gambling

as addicts.

as the “Casino Bill.” This unpopularity was a

addiction that already exist in society. For her,

Were such policies put into place on a national

key factor that led Prime Minister Shinzo Abe

this is the top priority.

scale, then Ms. Tanaka says that the establishment

to drop efforts to pass the bill in the previous

According to Ms. Tanaka, about one in twenty

of integrated resorts wouldn’t trouble her greatly.

Diet session, and it remains a major hurdle

Japanese adults can already be classified as

Whether or not the Casino Bill will actually be

going forward.

gambling addicts of one kind or another. The

passed remains entirely unclear. What is fully

House of Representatives lawmaker Mito Kakizawa,

form of gambling addiction afflicting about 80

apparent, however, is that its prospects will

a strong proponent of the Casino Bill, has turned

percent of these people is pachinko. Although

rise considerably if it is preceded by, or paired

much more pessimistic about its prospects for

most Japanese do not really associate pachinko

with, legislation that is seen to grapple seriously

passage than he had been previously.

with the word “gambling,” this is where Ms.

with the potential negative effects of gambling

Kakizawa explains, “I do think that Mr. Abe

Tanaka says that the largest problems lie.

in Japanese society. l

Asia Gaming Briefings | November 2015

Japan’s baseball industry has been rocked by a scandal involving some of its leading pitchers betting on pro-games.

Although not accused of matchfixing they ran into hot water as betting on pro-sports is illegal. The pitchers played for the Yomiuri Giants, one of the country’s oldest teams.

MGS 2015 BOOTH AQ36 +853-2857-5762

W W W. A R UZ EG A M I N G .COM

INFO@AGAMACAU.COM.MO

NORTH ASIA 16

SOUTH KOREA

GROSS GAMING REVENUE

MERS outbreak highlights risk of tourism dependency for Korean casinos

GGR Y14 (including lottery and racing) KRW19.87 trillion (US$17.64b)

South Korea says its tourism arrivals have now almost recovered following an outbreak of Middle Eastern Respiratory Syndrome in May that triggered a three-month plunge in visitor numbers.

T

Tourism spending Jan - Aug

+1%

-11.2%

Visitors Sept.

1.21 million China arrivals

-3.1%

+4.8%

he outbreak, which caused 37 deaths,

president of Mohegan Tribal Gaming Authority,

led to a more than 40 percent drop in

told the Yonhap News Agency in a recent interview.

arrivals in June, a 53 percent decline in

Soper said the island has great potential to become

July a 26.5 percent slide in August. It

a major tourism attraction in Asia once world-

also highlighted the vulnerability of the South

class resorts are built in the area to encourage

Korean casino market to tourism trends, given

passengers to stay there and have fun.

locals are not permitted to gamble.

Incheon International Airport handles more

Paradise Co. said casino sales dropped 50.2

than 45 million visitors annually and is currently

percent in June, while Grand Korea Leisure said

under expansion.

the average daily number of visitors to its Seven

South Korea is also facing growing competition

Luck casinos dropped from nearly 4,900 in May

from other destinations around Asia.

to 3,200 in June and 2,500 in July.

However, comparing the prices of package travel

Authorities have pushed hard to woo back the

products from China to several countries in Asia,

tourists, especially those from Mainland China.

CLSA in recent research found Korea to still have

South Korea waived a $15 visa processing fee

a price advantage.

beginning in July through to December this

“We compared the prices of group (package) tours

year for all group tourists from China and four

to major Chinese tourist destinations (Korea,

southeast Asian nations, including Vietnam, the

Japan, Thailand, Taiwan, Singapore, Indonesia

Philippines, Indonesia and Cambodia.

and Vietnam) in Asia using Ctrip (from Shenzhen)

They also launched aggressive marketing campaigns,

and CITS (from Beijing).”

with popular Korean bands roped in to perform

The average travel cost for these seven countries

promotional concerts and initiated the first “Black

came to RMB931 ($145) per day. The travel cost

Friday” shopping event, timed to coincide with

to Korea is RMB754 per day, or 19 percent lower

the Chinese Golden Week holidays.

than the average.

Other measures included a 10 percent tax refund

Group tour prices to Japan were 105 percent

on cosmetic surgery over the next year and free

higher than to Korea, while semi-tours (a mix

medical insurance.

of package and free travel) and free tour prices

As a result, visitor numbers were down just 3.1

(hotel and flight) were 38 percent and 11 percent

percent in September to 1.2 million tourists.

higher than Korea as well.

About half of those visitors were from China,

“Given the large price gap between Japan and

City casino complex near Incheon International

making up the biggest sector.

Korea, the profile of Chinese tourists visiting

Airport, along with Japan’s SegaSammy.

Growth in China visitor numbers has been one

these two could be different. We have highlighted

The other area seeing a surge in activity is on Jeju

of the main reasons for the interest in casino

Chinese inbound traffic to Korea and Japan could

island in the south, which is a self-governing

operators in bidding for two licenses for integrated

grow strongly in tandem as both countries are

province and as such not part of the request for

resorts. A total of 34 companies have thrown their

popular destinations, and not alternatives.”

proposals process for the two IRs.

hats into the ring, with the winner expected to

Although the 34 proposals for resorts were spread

Philippine-based Bloomberry Resorts Corporation

be announced in December.

across the country, analysts eventually expect the

recently re-opened the casino of its new re-

The Mohegan Sun, a U.S. regional operator is one

government to choose two projects in Incheon,

branded property on Jeju Island in Korea under

of the interested parties for its first foray out of

where two are already underway, creating a hub.

the new management of Jeju Sun Hotel & Casino.

the U.S. It’s eyeing a resort on Yeongjong Island,

LOCZ Korea, a Chinese-U.S. consortium of Lippo

Bloomberry has a 96.23 percent shareholding in

a transportation hub located west of Seoul.

and Caesars Entertainment, won approval to open

Jeju Sun Hotel and Casino, 10 percent held directly

“While we have previously looked at various

a foreigners-only, casino-driven resort by 2018

and 86.23 percent held through its subsidiary

development opportunities outside of North

in Midan City on Yeongjongdo Island.

Solaire Korea Co., Ltd.

America, this is the first opportunity we felt

While Paradise, Korea’s largest operator of

While Lotte Tour Development recently announced

compelling enough to pursue,” Bobby Soper, the

foreigner-only casinos, is building the Paradise

the largest IR plan for the island so far. l

Asia Gaming Briefings | November 2015

Chinese police arrested 13 South Korean casino managers from Grand Korea Leisure and Paradise Co suspected of luring gamblers from China to South Korea. Police launched a probe in June into “criminal gangs” from five South Korean casinos, who “enticed” Chinese with free tours, free hotels and sexual services, Chinese television reported.

South Korea’s Jeju Island will get a second major foreigners-only integrated casino resort after Lotte Tour Development took over the Dream Tower Resort from privately held affiliate Dongwha Investment and Development Co. Lotte agreed to pay out 5.7 million shares, worth about $85 million for the injection of the IR.

SOUTH EAST ASIA 18

GROSS GAMING REVENUE (Source: Morgan Stanley)

Y14

Y15E

$1.88 b

$2.04b

Y16E

Genting Malaysia 2Q15 revenue RM1.98b ($468.6m)

MALAYSIA

Genting delays opening of star theme park attraction Genting Malaysia has delayed the opening of its 20th Century Fox theme park until 2017, a development that analysts say is negative for the company as the attraction was expected to be a key driver of visitation.

M

$2.42b

+4%

Genting Malaysia is buying the group’s U.K. online gambling business for GBP7.2 million ($10.9 million) as part of an ongoing effort to streamline the group structure.

Genting is competing with America’s Hard Rock International, South Africa’s Sun International, Cambodia’s NagaCorp and French conglomerate Bouygues for a casino license on the European island of Cyprus.

alaysia’s only casino operator is

Genting says it’s reviewing the cost of the

added 1,500 in room capacity by end-June to

in the middle of a major revamp

project due to the sharp deterioration in the

meet the demand and the occupancy rate stood

at its Resorts World Genting

ringgit, which has slumped about 20 percent

at 91 percent in 2Q15 (vs 89 percent in 2Q14).

Highlands property spending

against the U.S. dollar this year.

The company also said the average room rate

MYR5 billion ($1.2 billion) to upgrade hotels

The firm said the meeting with management

was up 7 percent to RM81.

and add shopping and other leisure facilities.

yielded both negative and positive surprises.

The resort saw a doubling in visitation from

The real crowd puller for the renovation project,

On the upside the new shopping mall and

China, while Hong Kong tourist numbers were

however, is seen as the Twentieth Century Fox

additional gaming capacity will come onstream

up 50 percent and Singapore up 3 percent.

World, the first theme park licensed by the US

from mid next year compared to the initial

“In the backdrop of weak Ringgit against

film studio. Sister company Genting Singapore

date of late 2016. This positive however may

regional currencies, we expect visitation to

runs a theme park with rival Universal Studios

be offset by pre-operating expenses, it said.

Genting Highlands to continue growing in 2H15

in neighbouring Singapore.

Again on the upside, CIMB added that the

and 2016,” TA Securities said in a recent note.

According to the plans, the 25-acre park will

recently introduced GST, a consumption

Meanwhile, the group’s U.K. operations,

feature more than 25 rides and attractions

tax, has not affected gaming volumes and

which have been a drag on its results, may

based on Fox films such as “Ice Age,” “Rio,”

consumers remain upbeat.

get a boost with the opening of a major new

“Alien vs. Predator,” “Planet of the Apes”

“Negative consumer sentiment has also not

resort in the Midlands city of Birmingham.

and “Night at the Museum.”

hurt gaming volumes, in line with Genting

The property opened on October 21st, bringing

Twentieth Century Fox Consumer Products

Malaysia’s experience in past economic cycles.

an integrated resort-style experience to the

president Jeffrey Godsick has said that the

This is a testament to Genting Malaysia’s

area for the first time. Attractions include

resort, which had been scheduled to open

economic moat. It is a defensive casino

outlet shopping, bars and restaurants as

late next year, would attract people from

monopoly domestically,” it said.

well as Cineworld, one of Europe’s leading

around the world.

The group is also seen as benefiting from

cinema groups.

After a recent meeting with management,

weakness in Malaysia’s ringgit.

The UK operation suffered losses of RM61.6

CIMB analysts called the delay in the opening

Visitation to Resorts World Genting Highlands

million in 1H compared with RM10.3 million

of the park a negative for the company.

improved 9 percent in 2Q15. The group had

in the year-earlier period. l

Asia Gaming Briefings | November 2015

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SOUTH EAST ASIA 20

PHILIPPINES

Loss of lustre for analysts Bloomberry Resorts Corp’s CEO Enrique Razon has warned against tarring the whole Asian casino industry with the same brush as Macau, saying the situation in the Philippines is nowhere near as bad.

H

e expects losses at his company to

base as one of the reasons for optimism, with

includes a certified 1,760-seat lyric theatre.

narrow this year, with the negative

less reliance on the Chinese than many other

Bloomberry’s Sureste Properties arm is purchasing

results seen in the first half from

destinations around Asia. The Philippines also

a plot of land measuring more than 15,000 square

operators the result of development

has the advantage of local participation, with

meters in Quezon City, Philippines.

costs. He said revenue is still growing.

a growing middle class who are permitted to

The 15,676 sq. m area valued at PHP1.98-billion

“The whole industry has been painted with the

gamble in the country’s casinos.

($43.16-million) was purchased from the National

same brush, but we’re nowhere near the situation

Total international visitors for January to August

Housing Authority’s share in the joint venture

in Macau, where revenue is really falling,” he

2015 was recorded at 3,590,038 for a 9.87 percent

between the NHA and Ayala Land, Inc. in the

told Bloomberg in an interview.

gain compared to its corresponding figure of

Vertis North project.

The company, which opened the extension to its

3,267,542 in 2014.

Bloomberry Resorts Corp reported a net loss

Solaire Casino & Resort in November last year,

Korea is still the top contributor of international

of PHP189.5 million ($4.1 million) in 15Q3,

plans to provision by year-end for all unpaid

arrivals to the country for 2015 with 901,749

compared to a net profit of PHP991.7 million

credit extended to VIP and premium players.

arrivals and a 25.12 percent share of total

in the prior year period. Gross gaming revenue

Still, analysts remain cautious. At the beginning

inbound traffic.

for the third quarter of 2015 increased by 19.5

of the year, most were optimistic about the

The U.S. provided the second largest number of

percent to PHP8.8 billion

prospects for the Philippines, seeing new supply

arrivals at 531,217 visitors, recording growth of

as driving growth. It was also expected to benefit

7.68 percent. Arrivals from Japan grew by 7.71

from the exodus from Macau.

percent, recording 334,881 visitors for the period

However, Morgan Stanley analysts recently

in review. China provided 322,417 arrivals with

downgraded their gross gambling revenue

growth of 4.55 percent for January to August 2015.

estimates, citing lower-than-expected VIP growth.

The firm now expects GGR of $1.4 billion for this year. It targets $1.6 billion for 2016, down from its prior estimates of $1.7 billion.

store sales growth” for Resorts World Manila and Solaire would only grow by 3 percent, said MS Research.

“Our GGR expectations for the three casinos in the Philippines are 17%-54% lower than consensus for 2016 and 2017. Our reduction is

Belle Corp and Melco Crown held the soft opening of the $1.3 billion City of Dreams casino resort

OPERATORS

project in December and the grand opening on Feb. 2.

As of June 30, 2015, City of Dreams Manila has around 272 gaming tables, 1,588 slot machines

Excluding City of Dreams Manila, which was in the initial stages of opening in 2015, “same-

CITY OF DREAMS

SOLAIRE RESORT & CASINO

Solaire, owned by Bloomberry Resorts, is a 16-hectare gaming and integrated resort complex along Asean Avenue in Parañaque City and was the first casino to operate within Entertainment City. In November 2014, the company opened

and 130 electronic table games in operation. The integrated resort features three entertainment venues, namely: DreamPlay by DreamWorks, Manila’s first branded Family Entertainment Center; Centerplay, a live performance central lounge inside the casino; and Chaos and Pangaea Ultra-Lounge, two nightclubs situated within the Fortune Egg, an architecturally-unique

mainly due to lower volume growth in the VIP

its SkyTower, more than doubling the size of

segment.” It adds that demand from overseas

the resort, increasing the room count by 64

VIP remains weak and junket ramp-up taking

percent to 800.

longer than expected.

Bay Tower of Solaire consists of a casino with an

Bloomberry is likely to be affected more than

aggregate gaming floor area of approximately

Resorts World Manila by the lack of Chinese VIPs

18,500 square meters (including approximately

it says, estimating that the Chinese account for

6,000 square meters of exclusive VIP gaming

60-70 percent of total VIP roll for Bloomberry

areas), with approximately 1,400 slot machines,

and 10-15 percent for RWM.

295 gaming tables and 88 electronic table games.

The regulator, Philippine Amusement and

Bay Tower has 488 hotel rooms and 15 specialty

Gaming Corp., continues to be upbeat about

restaurants.

the prospects, in July predicting that revenue

Contiguous to the existing Solaire Resort and

Travellers International Hotel Group, a joint

could reach $3 billion this year, well above the

Casino, the Sky tower consists of a 312 all-suite

venture between Genting Hong Kong and Alliance

consensus expectations of analysts for $2.2 billion.

hotel, additional ten VIP gaming salons with 66

Global, says it has so far put aside about PHP10.86

It points to the country’s diversified tourism

gaming tables and 223 slot machines. It also

billion ($236 million) of the proceeds from an

Asia Gaming Briefings | November 2015

dome-like structure accented with creative exterior lighting.

City of Dreams Manila includes an approximately 260-room Crown Towers hotel, a 365-room hotel managed by Hyatt International Corporation and Asia’s first Nobu Hotel with 321 rooms.

RESORTS WORLD MANILA

SOUTH EAST ASIA 21

GROSS GAMING REVENUE Y14 $2.5b

+16%

H1E $1.4b

+16%

Y15E $3b

+20%

Y18E $6b (Source: Pagcor)

$1.46b

$1.6b

$1.69b

Y15E

Y16E

Y17E

(Source: Morgan Stanley)

CONSENSUS VIEW $1.8b

initial public offering to fund the expansion of Resorts World Manila.

The company, which is engaged in principally the casino and hotel business, invested PHP2.05 billion in 15Q3 to expand the resort following a November 2013 IPO through which the company issued an additional 1,573,222,300 common shares generating net proceeds of P16.5 billion.

The second phase of the property, which includes the expansion of the Marriott Hotel Manila by an additional 227 rooms, is expected to be ready by 16Q1.

The expansion will cover a two-hectare area currently used as a carpark. This will include a four-star international branded hotel offering 1,000 rooms, sitting atop a full-service shopping mall that will link Resorts World Manila to Terminal 3 of the Ninoy Aquino International Airport.

The company has delayed the opening of a second Manila resort, the $1.1-billion Resorts World Bayshore along Manila Bay to 2018.

Pagcor has approved new gaming capacity of 420 gaming tables and 4,148 gaming machines at the resort. At end-2013, Resorts World Manila housed 287 gaming tables for the VIP and mass markets, 1,822 slot machines and 210 electronic table games.

MANILA BAY RESORTS

Y15E

$2.2b

Y16E

$2.53b

Y17E

Tiger Resorts and Entertainment, the Philippine unit of Japan’s Universal Entertainment, held a topping out ceremony in July for part of its Manila Bay Resorts project and said it had been

Tourism arrivals Jan - Aug. 3,590,038

+9.8%

granted an extension to its deadline to complete the project to the end of December 2016.

In return for the delay, the company also agreed to up investment to potentially as much as $4 billion. It plans to raise $600 million through a bond sale to help finance the complex.

The company recently appointed Steve Wolstenholme as chief operating officer. Wolstenholme has previously served as president and COO of Grand Sierra Resort and Casino in Reno, Nevada.

Bloomberry Resorts Corp. has set up Solaire de Argentina SA to explore investment in a casino in Argentina. The company has appointed the head of the country’s hotel association, Oscar Alberto Ghezzi, as president of the venture.

Once fully operational, Manila Bay Resorts would feature two luxury hotels, a 30,000-squaremeter casino floor with 3,000 slot machines and 500 table games, as well as a number of dining, leisure, and entertainment options. It will include an indoor man-made beach club covered by a huge glass dome, high-end and casual dining restaurants, upscale retail shops, trade halls and cinemas.

The group recently overcame a key regulatory hurdle by teaming with local businessman Antonio O. Cojuangco and his All Seasons Hotels & Resorts

Pagcor surpassed its revenue target in the first nine months of the year due to strong gaming income. In its third-quarter financial report, Pagcor reported that gross revenues reached PHP35.73 billion from January to September this year, higher by 16 percent compared with PHP30.68billion target for the period.

Corp. to comply with Philippine regulations on foreign land ownership. l

Asia Gaming Briefings | November 2015

SOUTH EAST ASIA 22

SINGAPORE

GROSS GAMING REVENUE

Marina Bay Sands delivers positive 15Q3 surprise

Y14 $6.05

Las Vegas Sands’ Singapore unit delivered a healthy set of Q3 results, showing the market it was resilient to the downturn in China VIPs and lending weight to the view the market may have bottomed out in the first half.

M

arina Bay SandspostedEBITDAof$390

with 19 percent growth. Visitor numbers from

million, which was about 6 percent

Taiwan also gained strength, up 11 percent.

higher than analysts’ estimates and

However, Singapore did see a decline in tourism

came despite a lower hold.

numbers from most of its Association of South

Mass and slots were down 1 percent year-on-year,

East Asian neighbours, hindered in part by the

but on a constant currency basis, they showed a

relative strength of the Singapore dollar against

gain of 8 percent. Total mass win per day of $4.8

other currencies in the region.

million was a new quarterly record.

On an earnings call, chairman Sheldon Adelson attributed the solid performance to the “successful execution of our strategy to bring premium mass

than expected, with the mass segment that is less dependent on Mainland China sourcing and is more locally sourced and internationally diversified showing signs of improvement,” UBS said in a note following the release of the results.

-21%

Y16E $4.5b

-6%

(Source: Morgan Stanley)

Y15

-11%

VIP GGR

-26%

Mass GGR

-3%

(Source: UBS)

OPERATORS

customers from throughout Asia to Singapore.”

“Singapore was a brighter spot, coming in better

Y15E $4.7b

RESORTS WORLD SENTOSA

Spans 49 hectares and features six hotels, a convention centre, the region’s only Universal

VIP TAX 5% MASS TAX 15% SINGAPORE POOLS, SINGAPORE TURF CLUB GGR FIVE-YEAR AVERAGE $2.39b

Studios theme park, one of the world’s largest aquariums, as well as restaurants and spas.

VIP rolling volume was also strong, showing

The casino has more than 500 tables and more

gains of 25 percent, although analysts warn the

than 2,400 slots. Genting opened a new hotel,

numbers are still likely to be volatile.

Genting Hotel Jurong, in April this year. The

“While we caution VIP in Singapore can vary

15-storey property was designed to help boost

greatly given the concentrated player VIP base

the company’s mass tourism base.

(hundreds versus thousands in Macau), we believe

The company reported Q2 casino revenue fell

3Q15 Singapore results may allow for some renewed

28 percent to $428.3 million. Adjusted EBITDA

optimism from investors for forward growth,”

declined 6 percent to $296.4 million.

Sterne Agee analyst David Bain wrote in a note.

Genting Hong Kong, which operates Star Cruises, has acquired Singapore’s iconic club brand, Zouk, for an undisclosed sum. The club will continue to operate under Benny Heng, the club’s newly appointed managing director and former general manager.

UBS has revised down its forecasts for the Singapore market overall for 2015 due to a decline in VIP traffic, but also notes that the worst may have passed, with the trough hit during the

MARINA BAY SANDS

Features approximately 2,600 rooms and suites

second quarter.

located in three 55-story hotel towers. Atop the

The firm expects overall gross gaming revenue

three towers is the Sands SkyPark, an extensive

to drop 11 percent this year, compared with its

outdoor recreation area with a 150-meter infinity

earlier forecast for a decline of 5 percent.

swimming pool and several dining options. The

UBS expects LVS to have 56 to 57 percent market

integrated resort offers approximately 160,000

share in Singapore this year and next compared

square feet of gaming space with approximately

with previous estimates of 51 percent share in

600 table games and 2,500 slot machines.

both 2015 and 2016.

The property posted upbeat Q3 results. Adjusted

UBS estimates 2015 EBITDA of $1.497 billion

property EBITDA increased 10.8 percent year-

for Marina Bay Sands, down from $1.513 billion

over-year to $389.7 million. Hold-normalized

previously, due mainly to the strength of the

EBITDA increased 12.2 percent to $411.3 million.

U.S. dollar and 2016 EBITDA of $1.464 billion,

The property generated record mass gaming

down from $1.505 billion previously estimated.

win-per-day in local currency terms while hold-

Visitor arrivals to the island in the first eight

normalized adjusted property EBITDA increased

months of the year recorded a dip of 0.6 percent,

22.4 percent year-over-year on a constant-

though arrivals from China picked up strongly

currency basis. l

Asia Gaming Briefings | November 2015

The Singapore Turf Club has discontinued two of its most popular races. The $2.1 million Singapore Airlines International Cup and the KrisFlyer International Sprint have achieved their objectives in boosting the brand of Singapore racing internationally and will no longer be held, it says.

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INDOCHINA 24

CAMBODIA

Nagacorp shines in gloomy Asian casino market On an overcast morning in Cambodia’s capital, Phnom Penh, the country’s flagship casino looks less familiar than it did a year ago as construction obscures the entire front entrance.

Asia Gaming Briefings | November 2015

N

agaWorld, which began as a boat

Asian junkets, which are seeking to diversify

moored on the Mekong River 20

operations outside Macau.

years ago, is undergoing a major

In July, the company said it reached an accord

revamp, which is expected to help

with Jimei International to operate at least

accelerate growth at one of the brightest spots

seven gaming tables, while it also has a more

in Asia’s casino industry.

casual arrangement with Sun City Group.

In the nine months to end-September, Hong

“The group offers better commercial terms

Kong-listed NagaCorp posted a 47 percent

to junket operators and agents as a result of

increase in gross gaming revenue to $399.8

NagaWorld’s low cost structure,” NagaCorp

million, according to preliminary results.

said in a recent filing to the stock exchange.

VIP revenue was up 52 percent, while mass

The contribution from the junkets was already

revenue gained 43 percent.

evident in Q3 results, analysts say, though

For Q3, GGR was up 58 percent to $144.4

they add that going forward the terms paid

million, boosted by an almost doubling in

may not be so generous.

VIP numbers, though mass revenue was

“Overseas junkets continued to contribute

also strong.

more than 70 percent of total volumes. The

“We expect momentum to continue as new

company plans to scale down its revenue

initiatives bear fruit,” analysts at Morgan

sharing with junkets to 70 percent (max) in

Stanley said in a note commenting on the

early 2016 and this could improve margins,”

results. The firm has an overweight rating

Morgan Stanley’s note said.

on the stock.

Compared to other operators - such as Genting

NagaCorp says it’s seeing strong growth from

Malaysia - who have a long track record in

Vietnam, China and South Korea and hopes

attracting Chinese customers, NagaCorp is

to capitalize on the downturn in Macau to

still in the early days, says Union Gaming

further penetrate the Chinese market. It has

analyst Grant Govertsen.

been pushing to improve ties with North

“That said, [Naga] are clearly showing positive

INDOCHINA 25 their VIP clients, who gamble much less than the typical Macau VIPs, are just upper-middle class people who are not the target of China’s anti-graft campaign,” said Nomura.

NagaWorld has a monopoly in the Cambodian capital, which means no casino can operate within a 200 kilometer radius for at least another 20 years. As a result, for many

NAGACORP Nagacorp GGR to end-Sept. $399.8 million

+47%

H1 tax revenue $12 million

+20%

gamblers it’s the only casino in the country worth gambling in. The picture is changing, but the alternatives are mostly ramshackle operations along border towns that offer limited entertainment and accommodation and are difficult to access.

Tourism arrivals rose by 5 percent to just over 3 million in the first eight months of this year, with Vietnam making up 20.8 percent of the total, China 15.2 percent, Korea 9.2 percent and Laos 7.4 percent.

As of the first six months of the year, NagaWorld had 262 gaming tables and 1,600 Electronic Gaming Machines. In May this year, the company

The Cambodian government has granted 10 new casino licenses in the third quarter of this year, raising their number in Cambodia to 75. Ros Phearun, a deputy director general of the financial industry department at the Ministry of Economy and Finance, says most of the 10 new casinos are in the coastal resort of Sihanoukville.

reached an accord with investors to place up to 300 gaming machines in NagaWorld, for growth as it relates to Chinese customers,

which it received a $40 million fee.

which is a rarity these days relative to places

Unlike operators in Macau, which are trying

like Macau, Singapore, and Korea.”

to diversify their business mix to offer more

“Without exception, Naga has been the

non-gaming facilities to attract mass market

one Asian gaming story that continues to

customers, Naga’s gaming and non-gaming

generate strong earnings growth while many

revenue mix has not changed significantly,

other regional gaming markets are mired in

said Govertsen.

decline or limited growth,” Govertsen said

“Although I suspect you’ll see a larger shift once

in a recent note.

NagaCity Walk and Naga2 open (with notably

However, despite the headline focus on the

more non-gaming revenue than before).”

China VIP, analysts point out that the bulk

Non-gaming revenue decreased by 6.1 percent

of Naga’s growth story is from South East

to $10.0 million, in the first half “mainly due

Asia, from IndoChina and also from at home,

to the increase in number of rooms sold to

where strong foreign investment is leading to

junket operators at a lower room rate, and

a growing expat community.

the temporary loss of rental income from five

Michael Ting, an analyst at CIMB said one of

existing luxury boutiques as a result of the

NagaCorp’s strengths is that it does not need to

temporary closure of the hotel main lobby area

rely on Chinese tourists, as a lot of its revenue

for NagaCity Walk’s construction.”

growth is driven by VIPs in Asean. Naga’s VIP

The group is spending $369 million on

is also more akin to Macau’s premium mass

expanding the resort, with the addition of

clients, who have been less affected by China’s

so-called Naga2, which will double capacity.

anti-corruption drive.

The second phase has a total built up area of

China VIPs are estimated at about 20-30 percent

about 110,105 square metres, which includes

of total revenue, with Malaysians seen at about

the NagaCity Walk, which will include luxury

49 percent and 10 percent from Singapore.

retail and public space.

“Also Naga is coming off of a low base for

The TSCLK Complex will feature about 1,000

VIP so the numbers look good,” Ting said in

hotel rooms, 38 luxury suites, a multi-

an email.

purpose entertainment theatre and additional

Brokerage firm Nomura cited NagaCorp’s

gaming space of up to 300 more tables and

management as indicating that more than

500 electronic gaming machines, according

60 percent of the casino’s customers are

to the company’s Web site.

Cambodians holding foreign passports.

The company said the expansion will position

“Management is not concerned about mainland

the Group as the leading integrated gaming

China’s anti-corruption campaign. It believes

and entertainment destination in Indochina. l

Donaco International announced that its VIP rolling chip turnover at Star Vegas Resort and Club casino in Poipet, Cambodia, grew 43 percent in the September quarter to approximately A$1.30 billion ($941.7 million) compared to the same period last year.

Asia Gaming Briefings | November 2015

INDOCHINA 26

Y14 DONACO REVENUE GGR Y14 $61.3m (Source: IISD)

Aristo International FY15 normalized GGR $68.4m

+21%

Total net revenue $30.8m

+51%

Casino visitors 90,663

+28%

VISITATION

VIETNAM

Tourist arrivals to end-Sept.

5.69m

If foreign investment in Vietnam’s casino sector were to increase by $3 billion from current levels, the country’s Gross Domestic Product would rise by 0.58 percent in the first year, according to a major study looking at the potential of the gaming industry.

Michael Kelly has been appointed executive chairman of Asian Coast Development Limited and its asset company, Ho Tram Project Company Limited, taking the reins of one of Vietnam’s biggest casino projects.

Casinos would boost GDP

T

he research was done by The Institute

of gambling and bonus game in large resorts

of Regional Sustainable Development

where are far away from populated urban

(IRSD) under the Vietnam Academy of

areas. These places should have the security

-5.9%

“The Aristo International Hotel in Vietnam is also back on track in recent months, after a difficult first year. Record levels of visitation and strong turnover figures give us confidence in the performance of this flagship business for the coming year,” Donaco International managing director and CEO Joey Lim says.

Social Science (VASS) and presented

system and manage players more strictly. Also

at the end of September. It looked at both

they need to have training programs for staff

the legal and illegal business in the country.

and work with local authority to prevent all

“This is the most complete research project

negative impacts,” the report recommends.

ever on the gaming industry in Vietnam,

The government has reportedly been considering

providing a scientific basis for the government

framework legislation for some time now, but

to consider suitable policies,” Nguyen Quang

there is no clarity on when a final bill may be

Thuan, vice president of VASS, said at the

implemented. While there has been frequent

release seminar.

speculation about major foreign investment in

Vietnam today has 64 lottery companies,

the country, as yet none of the bigger casino

8 casinos, 2 places for sport betting and 43

operators have announced any concrete plans.

centers of bonus electronic games. All of them

According to statistics released by The Institute

are restricted to foreigners only.

for Regional Sustainable Development, Vietnam’s

as well as spur Vietnamese to visit casinos in

The study recommended the government

eight casinos posted a combined revenue of

neighbouring Cambodia.

implement a comprehensive legal framework

VND1.379 trillion (US$61.3 million) last year

The Ministry of Public Security reported a

for gambling that would help to maximize

and paid VND339 billion in taxes last year.

total of 200 bookies for So De -- an illegal

the potential benefits, which include extra

Vietnam now also has 64 lottery companies

numbers game based on the state lottery --

budget revenue, more tourism attractions

and two sports facilities allowing gambling.

in 18 cities and provinces. The game earned

and increased employment, while at the same

Lottery companies paid VND20 trillion in taxes

at least VND500 million every day.

time mitigating potential social ills.

after earning a total of VND64 trillion ($2.85

A survey conducted in Tay Ninh Province showed

“In order to build up a legal framework as

million) in 2014.

that about 200 people crossed the Cambodian

above, the project proposed that Vietnamese

However, the lack of facilities to locals is

border every day to gamble, with that number

players would be allowed to join in some types

helping to drive a huge underground market,

rising to 700-800 on weekends. l

Asia Gaming Briefings | November 2015

SOUTH ASIA 27

GROSS GAMING REVENUE

INDIA

Pushing for clarity on Maharashtra casino act Sayta has alleged that the Executive arm of the

With a huge and rapidly expanding middle class, the potential for casino companies in India knows no limit - apart that is from a lack of a legal framework.

DELTA 2Q GAMING OPERATIONS REVENUE INR 8,481.29 IN LACS VS. INR 7,162.29

government usurped the power of the Legislative by not implementing the law, saying it amounts to a “constitutional fraud.” That was a term coined in 1986 by the Supreme Court in Dr. DC Wadhwa v. State of Bihar in the matter pertaining to repromulgation of ordinances by the executive without legislative approval.

“Using this judgment we are stating that nonimplementation of the will of the people as

The North-Eastern state of Arunachal Pradesh has become the latest jurisdiction to restart lottery schemes and has permitted distributors to market various lottery schemes with effect from September 2015.

reflected by the laws passed by the legislative

G

assembly of the state is also a constitutional

Delta says the launch of its casino in Daman is expected to substantially boost both revenue and visitors, resulting in better margins at the property. The hotel opened in March 2014.

ambling is banned in all but three

fraud,” he said.

states, but even then, the situation is

He adds he turned to the High Court rather than

not clear cut.

going directly to the Supreme Court as the higher

High Courts in various states have

body doesn’t generally entertain petitions directly

passed verdicts that appear to offer a glimmer

and is hesitant to exercise its original jurisdiction,

of hope that gambling will one day be permitted,

unless the petition has an impact on Centre-State

starting with games of skill. For example, the

relations or is a grave national issue.

Madras and Andhra Pradesh High Courts have

“Citizens are normally expected to approach the

ruled that rummy was legal as it was a game of

High Court first for constitutional remedies, and

skill, as opposed to a game of chance. The West

therefore I filed my PIL in the High Court and not

Bengal and Karnataka High Courts have also ruled

Supreme Court. Having said that, I have not ruled

health of the Maharashtra government is not very

favourably in cases related to poker.

out the option of appealing to the Supreme Court

good at present, and revenues from gaming and

However a young lawyer has been making waves

in case I am not satisfied with the final order of

casinos can be used to fund various schemes (that

with his attempts to force more clarity on the

the Bombay High Court.”

the government has not been able to implement

legal situation in Maharashtra, the third-most

The stakes may be high. Although figures are

properly due to lack of funds).”

populous state whose capital Mumbai is the

hard to come by, a report from KPMG estimates

Although gambling is popular in India, there are

commercial heart of India and one of the biggest

that about $60 billion may have been gambled

also conservative elements of society opposed

cities in the world.

in the country in 2010. That compares with the

to legalizing casinos, which are only allowed

Law graduate Jay Sayta, 23, unearthed 48-year-

$44 billion in gross gambling revenue reported

at present in Goa, Daman and Sikkim. Goa’s

old legislation when still a law student that shows

in Macau in 2014.

casinos are situated on offshore boats, while a

the state government passed an Act legalizing

Sayta says any move by Maharashtra to legalize

casino planned in a new luxury five-star property

casinos. That Act was never implemented and

gambling would have significant benefits for

owned by Delta Group in Daman is still in limbo.

he wants to know why.

the state economy, would help control crime,

“I do not know the reasons why the government

He filed a Public Interest Litigation in the Bombay

and may create a ripple effect across the rest of

has refrained from implementing the law,” Sayta

High Court aiming to force the government to

the country.

said referring to the mothballed Maharashtra act.

clarify why it has not enacted the law. In response

“There is potential for thousands of crores of

“From the government files examined by me, it

to his prodding the court subsequently ordered

revenues by way of taxes on casinos if the law is

seems that the government has simply left the

the government to clarify its position.

implemented. Further, currently, a lot of black

Act in cold storage and not once thought about

Sayta spoke to AGB about his PIL and the wider

money is generated through gambling and

implementing it. However, I am still waiting for

implications.

betting and this is used by terror organizations

an explanation from the government in response

He said the Bombay High Court has now on two

to fund their illegal activities. A Supreme Court

to my PIL. Once they respond to the points raised

occasions asked the government to explain its

appointed Special Investigation Team (SIT) has

in my petition, there would be more clarity on

stance, which he sees as a validation of his PIL.

also said that gambling and betting is a major

the reasons for non-implementation of the law.

“We are not pressing the court to compel the

source of black money in the country. Therefore

“I think in the interest of national security and due

Maharashtra government to notify and implement

legalizing gambling will not only reduce the source

to the obvious economic benefits of implementing

the Casinos Act, but have merely asked them

of revenue of the underworld but in my opinion

the Act, the state government should take a

to make their stand clear one way or the other,

is also a national security concern,” he said.

reasoned decision at the earliest. It is the job

since they cannot keep a law duly passed by the

“Casinos can also help promote Maharashtra

of the state government to get all stakeholders

legislature in abeyance for an unreasonably long

as a favoured tourism destination and provide

on board and convince them about the positive

period of four decades,” he said.

employment to thousands of citizens. The fiscal

effects of implementing this law,” he said. l

Asia Gaming Briefings | November 2015

2016 PREDICTIONS 28

The end of the IR “arms race” 1.

David Green*

An end to the IR “arms race”. While the “build

participating in credit-based rolling chip programs will

it and they will come” mantra has generally

continue to decline, at least until such time as confidence

served the i ndustry well, the declining

in the integrity, and sustainability of VIP operations is

investment yields associated with ever more ambitious

restored. I expect that VIP play will account for no more

and expensive projects in markets with either declining

than 45 percent of gross gaming revenue across 2016.

gross gaming revenue, or an unproven market potential,

but it needs a re-appraisal, especially in sophisticated

3.

prospective markets such as Japan, which will likely be

leading gaming companies raises questions about

unwilling to embrace massive investment if the trade

governance, organizational renewal and the ability of

off is commensurately large scale gaming.

such organizations to change. Success has diverted

suggest that investors may be less willing to support outlays matching or above those to which we have become accustomed. The IR model is far from broken,

* David Green is a principal at Newpage Consulting, experts in gambling regulation. The company advises in the three key areas of regulatory frameworks, market analysis, and taxation regimes.

2.

Succession questions likely to exercise the minds of industry stakeholders. The tenure, influence and age demographic of those

occupying the big offices in many of the world’s

attention from these issues…why be concerned about The continuing rise of the mass market in

“best practice” when the gravy train rolls on? However,

Macau. The exposure of the inherent fragility

as investment yields moderate and new market

of the Macau junket business model will likely

opportunities become less attractive, expect this to

cause a re-orientation of properties towards the mass

become a focus for shareholders, financiers, gaming

market. The share of gaming revenue attributable to those

and securities regulators and host governments alike. l

Asia Gaming Briefings | November 2015

2016 PREDICTIONS 29

Global Market Advisors’ Predictions for 2016 the gaming floor.

only sales on their hotel rooms to their databases

The pain in Macau is far from over, but the strong will survive

Ever wonder why every successful high limit

of customers. These pricing tactics are often

slot room still has the old IGT S2000 stepper

employed to keep heads in beds with the hope

slot machines and other forms of old-school

that they will equate to butts in casino chairs.

With the number of properties opening up on

mechanical reels? It is because customers believe

the Cotai Strip from now through the end of

they can trust them and know that they hold less

2016, and the expectation that the VIP segment

than new multi-line video reel machines with

will continue to struggle due to PRC policies

bonus rounds.

Steve Gallaway*

and an overall contraction in China’s economy, sufficient demand will not be there to support additions to supply (a basic concept taught to every student in an Economics 101 class). While various Wall Street and Hong Kong analysts have correctly estimated 2016 gaming revenues (at least as much as possible when trying to project revenues based on a political policy rather than market demand), large contractions in EBITDA margins are to be expected. Operators now have much larger properties to feed in a market whose gaming revenues will at best be flat. The situation in 2016 will be analogous to the situation MGM faced when it opened City Center in the midst of the Great Recession. Put simply, 2016 is going to be a rough year for Cotai 2.0.

On the upside, this is not the first time Macau

The importance of gaming in emerging Asian markets will continue

operators continue to find ways to cut costs, such as fewer amenities in hotel rooms, a reduction in labor at hotel registration and the casino cage, and staff reductions elsewhere throughout their resorts. While customer satisfaction levels may see declines, operators will do what is necessary to weather the storm.

Skill-based games will go the way of Odyssey game cabinets, slot machines bolted to treadmills, and other novelties This year the gaming industry was abuzz with the introduction of skill-based games that supposedly enhance the slot machine experience. For example, a multi-line video game may offer a bonus round where the player must grab a joystick and play a round of Space Invaders in order to win a bonus.

While a portion of slot players may try their luck (and skill) on these types of games, they will soon discover that getting to the bonus round will take 30 to 100 handle pulls, and once they

One of the most popular topics among casino marketers in 2015 was how to get millennials into the casino and make them loyal casino patrons.

Millennials, or Generation Y, are loosely defined as those people who were born from the early

While China’s recession will impact everyone,

1980’s to 2000. The oldest of this generation

casino-resort development opportunities in other

are now approaching 35. What the industry will

Asian countries such as Cambodia, Vietnam and

discover, as it continues to re-tool its mix of

Laos will continue to grow. As these countries’

gaming products to appeal to this generation, is

economies grow and political environments

that millennials still lack the two most essential

stabilize, they will become increasingly attractive

elements needed to be casino patrons: time and

to casino-resort developers. Given the hyper

money. The oldest of this generation are trying

interest in South Korea and Japan, smaller

to pay off mortgages, put kids through school,

emerging markets will become that much more

and build a nest egg. The younger ones are still

attractive. The key for developers will be to build

spending whatever they make on cars, clothes,

casino-resort properties that are attractive but

apartments, electronic devices and whatever it

whose business models do not rely too heavily

takes to attract members of the opposite sex (or

on junkets from China.

same sex if that is their preference).

In fifteen years, this generation will eventually

operators have had to deal with an unexpected and significant downturn. As such, we will likely see

Enough of this talk about Millennials

age to the point where their kids are out of the

Andrew Klebanow**

house, the house is paid for, they have some

The days of 70 percent of revenue from junkets is behind us

money in the bank, and they have some extra

The more astute casino operators had long

going to happen anytime soon. While it is

realized they were far too dependent on junkets

important to focus on this generation for the

for the lion’s share of their revenue and EBITDA

long term, the people who will always pay the

performance. While a dollar earned from a junket

bills in the gaming industry will continue to be

customer contributed less to EBITDA than a

over the age of 50. Enough talk then about how

dollar won from a Premium Mass player, the

to attract millennials. Let’s just focus on how to

total volume from junkets was just too great and

attract people with time and money. l

time on their hands. Casino gaming will then become a source of recreation, but that is not

operators had to cater to that segment. Casino operators knew they were vulnerable if that part of the business contracted; now that reality has settled in and they are shifting their focus to other markets that may be less volatile. This includes new efforts by casino marketing departments on attracting mass market players and shifting table game allocation from junket rooms to the main gaming floor. Notwithstanding, if the junket business does come back, operators will gladly re-assign tables back to junkets.

* Steven Gallaway is managing partner at Global Market Advisors ** Andrew Klebanow is a partner at Global Market Advisors and an AGB Advisor Global Market Advisors (GMA) is one of the world’s leading consulting firms serving the casino gaming, hospitality and airline industries. The firm is well-regarded for its independence and

result is that they will become discouraged, walk

Macau casinos will employ pricing tactics with greater frequency

away and go back to their preferred game titles.

As the supply of hotel rooms on the Cotai Strip

Casino operators may put these games on the

increases in the next twelve months, expect

private equity funds, and commercial operators alike. GMA is

floor on a trial basis but they will never dominate

existing operators to offer more limited-time

get there, they will have become rusty from the last time they played the bonus round. The end

quality of thought-leadership. GMA’s feasibility reports for the casino gaming industry have received accolades from banks, highly experienced in the markets of Asia, the U.S. and Europe.

Asia Gaming Briefings | November 2015

2016 PREDICTIONS 30

“New Start for Macau” With a whirlwind 2015 coming to an end and holidays soon upon us, it is time to think about what is next. When the editors asked me for my predictions, they know I don’t possess a crystal ball so I was asked to write this as if somebody asked for my opinion in the pub. They must know me well. Macau will continue the race to reinvent.

John English*

A

fter a tumultuous year this becomes a simple

always need for VIP players and high rollers - that’s

prediction as we witnessed gaming revenues

what makes the casino dream exciting, the goal is to

come to a rapid slowdown and the collapse

become less dependent on that market and become

of most of the VIP junket market. So what’s

widely diversified. I see first hand that Macau is doing

next for Macau in 2016? I think it’s going to be another

that and is answering the call.

roller coaster year for Macau and I’m not referring to

For the premium players Macau offers an experience

* John English is President

the stocks, I’ll leave that to the analysts. As most are

that cant be rivaled anywhere in the region and provides

of WEBE Worldwide, a global

aware, there is a lot of frustration echoing throughout

world class gaming and luxury options so they will

gaming, management,

the region and with an unsure and unstable future

continue to come. The population of Southern China still

there is still a massive amount of new properties yet

prefers Macau to other gaming-oriented territories and

to open in Macau. Recent actions with regard to ever-

the visitor count is high enough to creatively monetize

important table allotments, government restrictions and

the mass market players utilizing electronic gaming

a slow decision-making process are driving operators to

alternatives. Some of the world’s greatest marketing

consider a different business mentality, a reinvention.

experts reside in Macau and there is already a major

The opening of the amazing Macau Studio City and

casino effort in play to engage the mass market across

its very diverse features, such as a world class movie

China and surrounding regions to embrace the total

studio and Galaxy Entertainment with its gargantuan

resort experience while still having their gaming

than 28 years. His emphasis

destination resort, are testament to the diverse change

desires met. We will see a “New Start for Macau” that

is on technology, content, and

that’s coming to Macau. Over time sights will be turned

will find its way to a settling point just like Las Vegas is

distribution, as well as public

toward over the top entertainment such as concerts

currently experiencing. The Cotai Strip will have several

relations, government affairs,

and shows, expensive resorts experiences, nightclubs,

new billion dollar plus resorts opening including Wynn

retail shopping and fine dining, creating a reason to

Palace and the Parisian, and on the Macau side there is

stay have fun and play longer. Macau cannot exist

a complete renovation underway at Fisherman’s Wharf

without gambling neither can Las Vegas and there is

including a yacht harbor and a six-star hotel offering

consulting, and operations firm with offices in the US and China specializing in the sports betting, social gaming, and casino industries. John is a serial entrepreneur and veteran Gaming Executive for more

and operational expertise.

John is an AGB Advisor.

Asia Gaming Briefings | November 2015

2016 PREDICTIONS 31

lots of new and exciting things to draw both

seems a change is finally on the way. There

year has allowed for several jurisdictions to

local and tourist visitation.

was a huge uprising this year in daily fantasy

approve skill gaming for real money play.

I don’t believe that the Government would want

sports, which had enjoyed an exemption from

This will have huge appeal to the boomers

something with such global exposure to fail,

the law as a game of skill and quickly raked

and the millennials as the titles start to roll

nor do the incredibly invested operators, so I

in millions of entrant fees and caught the eye

out; I know I was thrilled to play Pong and

have a positive outlook on Macau’s future and I

of the US Department of Justice. The state

other classic titles. All the major companies

see 2016 as a good start to a year of cooperation

of Nevada has since deemed that it is in fact

are buying in and buzzwords like eSports are

for a speedy recovery.

gambling and other states are following suit fast

now commonplace in the industry. Two big

with the same determination, requiring daily

gaming states, Nevada and New Jersey, are

Regulated Sports Betting will be Worldwide

fantasy sports operators to obtain a gambling

early adopters in the US and it has become

center stage

license to operate. These companies may have

a fast moving craze in countries around the

We are going to see a lot of movement in global

to cease doing business entirely, merge with

world. This means manufacturers are licensing

sports betting. With two massive mergers

existing licensed operators, or obtain their own

classic and hit titles like crazy and developers

being announced this year, for sure 2016 is

licensing to continue operations. All of this

are converting old games into money games.

going to bring sports betting to the center

recent activity has again opened the door for

Operators and patrons are responding to

stage. Powerhouse companies like Betfair

a 2016 regulation review with regard to legal

this new wave of gaming with applause and

and Paddy Power coming together, and Gala

sports betting. With that being said, I see that

although just getting started it’s going to be a

Coral and Ladbrokes joining forces, its going

there will be a bigger push than ever before to

nice addition for 2016. Look to see everything

to make things super interesting in both the

completely overhaul the Professional Amateur

from golf games, basketball, video games,

online and land-based sectors, and they will

Protection Act (PASPA) and regulate sports

pinball machines, first person shooter, and

be key companies to watch as these companies

betting in the United States in the jurisdictions

so many other thing. The draw for this type

truly span the globe, including some interests

that want it. I have predicted this for many

of product is so great it was the hot topic at

in North America.

years as it is a law that is outdated and does not

almost every booth at the Global Gaming Expo

Government approved lottery companies

work to serve or protect the people. However,

and there was a recent eSports competition

in Mainland China are now allowed to offer

the daily fantasy sports craze and massive

that was so big it had to be held at Madison

mobile sports lottery sales and I expect to

amounts of illegal bookmaking clearly shows

Square Garden.

see large growth in that sector next year as

that the demand for sports wagering is alive

The technology and hardware involved with this

the government looks to fund thousands of

and well across all of America, prohibition has

type of gaming will be an integral part of the

new football camps.

not proven successful in curbing the hundreds

experience, so look to see things like, virtual

In the United States, wagering on sports legally

of billions of dollars that are bet on sports

reality headsets, augmented reality software,

is limited by federal law to the state of Nevada.

illegally each year.

specialized motion seating, joysticks, sensors,

Long time battlers like New Jersey are fighting

pods, and a plethora of immersive technologies.

harder than ever to have it legal in their state,

A new generation of games and gamers

I don’t see it taking over the entire casino

lawmakers that were once opposed to sports

Finally some fun stuff has been injected back

floor anytime soon, but it will definitely have

betting have since changed their minds,

into the land-based gaming industry! This

its place in 2016 and I for one cannot wait! l

Asia Gaming Briefings | November 2015

2016 PREDICTIONS 32

The “golden” gap for emerging jurisdictions I have been asked to give my predictions for 2016 with respect to the gaming industry. I was told that one should cover Macau and the other two could address regional or even international trends.

Luis Mesquita de Melo*

This request comes at a time when the last thing anyone

VIP market model which has been based on the junket

wants to do is to make predictions on the gaming industry.

model for too long.

In fact, so much has happened recently that I would

Last, but not least, the entire credibility of the gaming

venture to say that my prediction is that there should

industry – but especially the VIP market - has been affected

be no predictions for the gaming industry.

by a regulator without teeth and a legal framework that

I entertain myself by looking at analysts’ predictions,

has not addressed important changes in the industry

on a weekly, if not daily, basis and how they juggle

and is clearly outdated.

contradictory facts, off the target numbers, excuses and underlying strange market phenomena. They try to find explanations from the weirdest circumstances just to keep selling their predictions as if they were the last form of hope.

2.

The “golden” gap for the emerging jurisdictions.

Since the focus has been Macau – as the biggest gaming jurisdiction in the world by numbers and

also because of the high profile of the industry players

The truth is no one wants to admit that the gaming

– with the contribution of very concerned media that

industry is going through very material changes that

have highlighted, continuously, all the bad things about

render predictions almost impossible and will transform

the industry, I believe that the Asian emerging gaming

the key elements of a business model forever.

jurisdictions (and especially the ones that are able to do

Having said this, and apologizing in anticipation for

right with respect to their regulatory regime) will benefit,

the high probability of failing my predictions by a long

for a limited period of time, from the decline of gaming

shot, here we go:

revenue and the market reshape in Macau. They will

1.

somehow improve their numbers and regional exposure

The foundering of the VIP market as we know it.

and that will attract players trying to get away from the

Despite the fact that most analysts still predict a

spotlights in Macau.

recovery in the VIP segment – although, as they

China is actively and in a very determined way fighting

3.

against any illegal flow of funds. The Macau Government

money with them to the casino), added to the fact gaming

has put further nails into the coffin by insisting on some

interest demographics are changing very quickly, I

absurd decisions, or coming up with new, not less absurd,

believe that interactive gaming, social media and more

Coast Development Ltd. Prior

measures that not only lack opportunity and timing but

technologically advanced gaming products, where physical

to that he held similar roles in

are very short of long-term objectives in preserving the

presence is not a requirement, will gain a new life. We

NagaCorp and Venetian Macao.

Macau economy’s “bread and butter”: Gaming.

should also note that all these new gaming products still

Luis is an an expert legal advisor

Then junkets have not helped by becoming the subject of

find their way, more easily, around regulatory constraints

news that showed how relaxed and fragile their internal

and jurisdictional oversight and, where there is no geo-

controls are, which affects the credibility of the entire

blocking, become very attractive and easy to access. l

like to underline, “not a V shaped recovery” – I don’t see how the VIP segment will ever recover, even to a small percentage of what it was a few years ago.

* Luis Mesquita de Melo is the Chief Legal Officer of Asian

and a member of the IMGL.

Asia Gaming Briefings | November 2015

A new opportunity for social media and online gaming solutions. As the land-based casinos struggle with players’ accessibility and the

mobility of funds (especially when it comes to bringing

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SPECIAL REPORT 34

Optimizing the cash cycle In July 2015 AGB was invited to visit Giesecke and Devrient (G&D)’s paper plant in Louisenthal, Germany, to witness their state-of-the-art processes for banknote production, printing and cash management. The visit was followed by a number of presentations by senior G&D executives at their headquarters in Munich which highlighted advancements in cash printing, security and management that ensure it continues to be a modern and convenient payment form. Banknotes are still the most used means of payment worldwide - and the only means available to many people in the world.

W

hat makes G&D a leader in the field

Banknotes meet Industry 4.0

is its passion for banknotes. Since its

At any one time there are 460 billion banknotes in

foundation, the company has strived

circulation, and this number is growing at 5 percent per

to develop designs that meet not only

year. The average lifecycle of a 5 Euro note is less than

aesthetic demands but that also revolutionize banknote

one year. It is the process of authentication, counting,

security. Its holistic, forward-thinking approach to

sorting, fitness sorting and serial number reading that

banknote production ensures continuous innovation

banknote processing systems aim to optimize. Any

across the entire value chain which encompasses

reduction in the cost of people and error rates, together

design, raw material preparation, production, security

with an increase in security as well as improved speeds

features, and finishing.

and volume management is attractive to large cash

G&D draws on its knowledge of the cash cycle to provide

handling institutions such as casinos.

efficient and secure banknote processing to commercial

The key requirements for any cash handling institution

banks, cash-in-transit companies, and casinos. The goal

are to know where the cash is, optimize stock levels,

is optimization of processing, tracking and conclusions

combat counterfeiting and manage banknote fitness

for the cash cycle. Improved sorting, packaging and error

- elements which are provided by G&D’s cash center

reduction is achieved through advanced automation.

automation.

Asia Gaming Briefings | November 2015

SPECIAL REPORT 35 Large resort casinos usually take in various

About G&D

From cotton to counterfeit-proof

currencies at each of their operations.

The company was founded in 1852 in Leipzig,

high-tech paper

Traditionally these receipts used to be processed

Germany, and currently counts 11,453 employees

On May 5, 1964 G&D took over Louisenthal in

at different in-house locations, involving the

worldwide, with 4,0632 in Germany and the

1964, the company employed around 170 people.

typical downsides of manual handling, moving

rest abroad. Its total earnings in 2014 were

Today, Louisenthal has about 1,000 employees,

boxes around, coordination, and wait times.

EUR 1.83 billion. G&D holds approximately

300 of whom are employed at the Königstein

With an innovative end-to-end solution,

7,250 patents around the world and spends

plant near Dresden and 700 of whom work in

banknotes are counted, identified and

around 120 million euros a year in research

Gmund, Lake Tegernsee.

authenticated, then sorted by denomination,

and development.

Louisenthal has invested around 300 million

series, orientation, and fitness for circulation

It’s key business units comprise the Banknote

euros in the modernization and expansion of

– all in a single run. Gaming tickets are

business unit, which includes the Banknote

paper and foil production at both its locations

processed in the same run. As an important

Solutions and Currency Management Solutions

over the past ten years.

extra, used player cards and table chips can

divisions, supports the complete cash cycle,

With the reunification of the German states in

be shredded if required.

from banknote substrate production, banknote

1990, demand for paper increased dramatically

The system produces customized, intelligent

design, and banknote printing to secure

and in 1967, Louisenthal became the sole supplier

reports which management and accounting can

processing.

of German banknote paper. For the first time

access at any given time, since cash processing

G&D supplies customers such as central and

ever, the third-generation German Mark was

is integrated with the casino’s back-office

commercial banks, banknote print works, and

produced with the well-known window thread.

systems. To check on the progress of cash

casinos over 150 countries around the world

In 1999, Louisenthal began investing in foil

operations, managers and supervisors just

with its portfolio consisting of banknote

production and commissioned its foil plant

need to log in to the server from wherever

security solutions, substrates, printing and

in 2003. 2005 saw Louisenthal produce the

they are.

processing systems, as well as managed

Bulgarian 20 Lev note, the first to incorporate

The integrated solution is rounded off by

services, and lifecycle services.

the varifeye® see-through window. Louisenthal

customized process design and count room layout

The Mobile Security business unit provides

is now one of the world’s technology leaders

since even the most powerful equipment can

security products and solutions for mobile

in foil-based security elements.

only achieve optimal results when combined

applications in an interconnected society,

The ever-improving quality of counterfeit notes

with smooth and efficient workflows.

while the Government Solutions business

has led G&D and Louisenthal to develop more

Through cash optimization, advanced

unit covers all security-relevant products

sophisticated safety features for printing and

automation solutions, use of Big Data and

and solutions for governments and public

paper, such as optically variable effects, the

managed services, G&D aims to stay at the

authorities, such as passport systems, visa

“banknote window” varifeye Magic®, and the

forefront of the banknote industry.

systems, ID systems, etc.

“RollingStar” security thread. l

Asia Gaming Briefings | November 2015

AUSTRALASIA 36

AUSTRALIA

Government takes aim at online gambling The Australian government has said it will launch a review of the country’s online gambling act, which is expected to look at live-sports betting, the regulation of offshore gambling operations and the regulatory changes required as a result of technological advancements within the industry.

Asia Gaming Briefings | November 2015

A

t present, the Interactive Gambling

and the ever-changing habits of customers.

Act 2001 prohibits the provision and

Edward Beesley, a former Ladbrokes commercial

advertising of online gambling to

development manager and now founder of

Australian residents and prohibits

TSoK consultancy, an international strategy

“in-play” betting for live sporting and racing

consultant in Australia, hopes the review is

events online.

more “wide ranging” and looks forward to

Regulation of gambling in Australia primarily

what might happen in the next two decades

rests with State and Territory governments,

within the sector.

but with many critics labeling Australia’s

“They need to not just look at now, but look

2001 Interactive Gambling Act outdated, the

ahead across the whole industry and try

review aims to develop a “national approach

and predict the trends for the next 15 to 20

to gambling policy ... in a cohesive and

years,” he said.

consultative way.”

England-born Beesley points to the rapid

Part of the pressure for the review has come

developments in the last two decades in his

from the country’s racing industry on concern

home country and around the world as an

over future funding for the sport, due to

example, with the emphasis shifting from

revenue lost to illegal offshore gambling.

retail to online, and from horse racing to

The review was welcomed by the industry,

sports betting and gaming machines.

however, one international expert stressed the

“The landscape changed so quickly in that

need for a long-term view to ensure any new

time – and it will continue to evolve with the

legislation stays up to date with technology

rise of new technologies and gaming options,”

AUSTRALASIA 37 he said. “For a start, you would expect that betting on horse racing will decline, betting on greyhound racing will decline as a younger generation comes through with other interests.”

Beesley pointed to the growth of e-Sports as a betting product as an example of a type of pastime perhaps not covered sufficiently by existing legislation.

“That’s the “in” product at the moment, all of a sudden we have a group of 18-25 year olds, that are interested in computer games and not interested in horse racing, as they might have been in the past,” he said.

According figures figures compiled by the Queensland government for the 2013/2014 year, wagering on horse racing in Australia fell 2.4 percent, while sports betting surged 29 percent, making it by far the fastest growing area of the industry.

The review will be led by former New South Wales Premier Barry O’Farrell and will consult representatives from the racing industry, professional sports, wagering organizations, state and territory governments and members of the public, with submissions being taken over the coming weeks and the review to report back on December 18.

Australia’s peak horse racing body “Racing Australia” welcomed news of the review, with its chairman Peter McGauran also noting the transformation of the gaming industry needs to be taken into account. “The thoroughbred racing industry strongly supports the government’s action in the face of a rapidly changing and evolving online landscape,” McGauran said in a press release. McGauran said racing not only suffers revenue loss due to offshore wagering but that it is a threat to the sport’s integrity.

“If left unchecked, racing authorities believe that the integrity of Australian racing and sports is at considerable risk,” McGauran continued, calling for accountability and transparency from outlaw operators.

“Racing regulators must have access to all betting transaction information for integrity assurance purposes, wherever that betting takes place. Racing stewards and investigators must be able to follow an audit trail to ensure integrity. Moreover, the responsible gambling policies of governments, including those of protecting minors, matter nothing to illegal offshore bookmakers.”

Racing Australia assesses the economic benefit of the racing industry to the national economy to be more than A$5 billion ($3.5 billion) and 132,000 jobs.

Racing Australia will make a submission to the

inquiry with key objectives not only around revenue and integrity, but protections against problem gambling and guards against “the proliferation of online gambling,” including online casinos and poker.

Tabcorp also warned of the risks of driving punters offshore.

“The rise of unlicensed offshore betting on Australian racing and sport needs to be addressed. Unlicensed offshore operators are not regulated to Australian standards and that poses risks to consumers and the integrity of sport and racing. It also means revenue that would otherwise be returned to the Australian

TOTAL GAMBLING EXPENDITURE All gambling Y13/14 A$21.15b Sports betting $625.95m Racing $2.78b Total gaming (including pokies and lottery) $17.74b

going to unlicensed offshore operators,” it

Casinos $4.38b

said in a statement.

(Source: Queensland Treasury)

racing industry and governments is instead

There are around 30 operators running legal gambling sites in Australia, but the government claims almost 60 percent of the A$1.6 billion gambling industry is going offshore.

Some authorized onshore companies have recently found themselves in hot water for trying to push the boundaries when it comes

+1.8% +29% -2.4% +1.7%

+6.5%

REAL GOVERNMENT REVENUE FROM TOTAL GAMING $5.15b CROWN RESORTS MAIN FLOOR GAMING OPS. +10% JULY - OCT.

to the ban on online “in play” betting and capture some of the market’s potential.

British operators William Hill, Ladbrokes and Bet365 sparked controversy by releasing betting systems that allow live bets to be placed without a phone call by merely checking if the punter’s computer microphone is on.

Ladbrokes has since withdrawn its service.

The Australian Wagering Council says: “Permitting online inplay betting will ensure that Australian operators compete on a level playing field with more than 2300 offshore

The Shire of Broome in the north of Western Australia is considering a casino and has hired a consultant to look at the viability of a project in the remote area. A team of advisers from Paxon Group will work to establish the social, economic and heritage opportunities, and risks, of a casino.

illegal operators who already offer this product to Australian customers.”

Beesley’s view on the 2001 act and specifically in-play betting laws was that Australia is being left behind. He said it was clear that punters are simply circumventing the current limitations by using Virtual Private Networks (VPNs) to bet with offshore operators on inplay options.

“You don’t need to be a computer wiz kid to bet via a VPN,” he said, adding that the option to bet live is still available. “You can

Australian Football League clubs are turning their backs on betting sponsorships by signing up to the Victorian Responsible Gambling Foundation’s ‘Gambling’s Not a Game’ program. The program, which has gained significant political support, aims to remove betting advertising from AFL grounds.

still bet live, if you go into a TAB or speak over the phone. That is where the European bookmakers have pushed the boundaries and re-defined what making a phone call is.”

The minister who announced the review, Scott Morrison, refused to state whether legislation would be changed before the next Australian federal election, which must happen before mid-January 2017, saying he would not “prejudge” the review. l

Asia Gaming Briefings | November 2015

AUSTRALASIA 38

VISITATION

NEW ZEALAND

Total gambling expenditure Y14 NZ$2.09b TAB racing and sports betting $311m

Falling revenue prompts review of gambling act New Zealand’s government is reviewing the gambling sector amidst concern about decreasing returns available to fund community projects.

A

s a start, New Zealand Internal

and what changes are needed to ensure that New

Affairs Minister Peter Dunne recently

Zealand’s gambling regulatory system remains

announced an amendment to the

sustainable and fit for purpose,” he said, adding

country’s gambling act, that includes

work is at an early stage.

increasing some gambling operator fees and

“I want to maintain a sustainable community

reviewing the minimum amount that gambling

funding stream delivered by trusted and reputable

trusts must return to the community from class

gambling operators; and I also want an Act that

4 gaming machines.

is flexible enough to meet the future challenges

Dunne said the government is concerned at the

ahead”, he said.

decline in gross proceeds from gaming machines

Dunne also announced that the Department will

over the past 10 years.

conduct a six-week public consultation on the

“Gambling proceeds provide a significant amount

amount that trusts must distribute to authorized

to community causes annually - $620 million

charitable purposes. The current minimum return

($418 million) in 2013/14, with 40 per cent or $250

to the community is 40 percent of gross gaming

million from pokies and 37 percent from lotteries.

machine proceeds, due to increase to 42 percent

Some of the decline is an inevitable consequence

by September 2018.

of the significant reduction in gaming machine

At present the New Zealand government is

numbers in the last ten years, but it is not the

carrying an annual gambling operating deficit

whole picture,” he said.

of $3.8 million as well as an accumulated deficit

Revenue from pokies declined 2.2 percent in 2014

of nearly $13 million. Fees have been unchanged

to $808 million, though proceeds still dwarfed

since 2008 and some fees will now increase from

returns from the country’s casinos, which reported

December this year to help plug the gap.

revenue of $509 million in the same year. When

New class 4 operator licenses (non-club societies)

adjusted for inflation, total gambling expenditure

will rise $3,616 to $15,795; annual compliance fee

in 2014 was down by almost 20 percent from the

(small club societies) goes from $378 to $295.50;

peak recorded in 2004 of $2.6 billion.

the daily monitoring fee per gaming machine rises

The Minister has asked Internal Affairs to report

$1.20 to $1.90; and a new venue license (non-

on the reasons for the decline and future forecasts

club societies) is up $904 to $2,567.

and impacts on community funding. Once this

Overall annual revenue from casino license

has been received, the Government will decide

fees will remain the same but Auckland and

early next year what further steps are required.

Queenstown SkyCity casinos will pay more and

“The Gambling Act has been in place for over 10

Hamilton, Christchurch and Dunedin casinos

years and it is time to assess what it has achieved

will pay less. l

Asia Gaming Briefings | November 2015

+0.09%

+5.6%

Lottery $463m

+7.2%

Casinos $509m

-2.1%

Gaming machines in pubs $808m

-2.2%

(Source: NZ Govt.)

SkyCity 21015 Normalized revenue $1b July revenue International business EBITDA

+8.7%

+11.5%

+35%

New Zealand’s Green Party is calling on the government to withdraw a concession granting SkyCity Entertainment extra pokie machines for its new Auckland resort due to claims it’s not doing enough to ensure responsible gambling.

SKYCITY Entertainment’s New Zealand International Convention Centre (NZICC) project has received resource consent approval from the Auckland Council. “Our objective is to turn the first sod of the New Zealand International Convention Centre before Christmas,” says CEO Nigel Morrison.

AUSTRALASIA 39

PACIFIC ISLES

VISITATION

Best Sunshine aims for world’s most luxurious resort Best Sunshine International has detailed ambitious plans for its $7 billion project on the South Pacific Island of Saipan, saying it aims to build the most luxurious integrated resort in the world.

T

he Hong Kong-listed company, which

The positive traffic figures come despite a

last year won the island’s only casino

devastating typhoon that hit Saipan, forcing the

license, says the rooms will be about

closure of the airport in August to allow room

three times the size of those currently

for relief flights.

available on Saipan.

Visitor arrivals in that month slumped 30 percent

The first Phase of the project at the old Samoan

from the same time the previous year, against

Housing site in Garapan, will include a “huge

projections for a gain of 3 percent.

dragon” making its way down the ceiling of the

Meanwhile, ALTER City Group, which plans to

14-story building, designed by U.S. architect Paul

construct a casino hotel on Tinian, has proposed

Curtis Steelman. The smallest room in the Grand

a $500 million Aerobus transit system between

Mariana casino-hotel will be about 1,200 sq. ft.

Saipan and Tinian.

Phase II will be 10 times larger than the first

Tourism growth on Tinian, the smaller of the

phase at the Garapan site which comprises a

two islands, has reportedly been hampered by

total of about four hectares and will have about

a lack of transport infrastructure.

2,000 to 4,000 rooms.

At a presentation for the proposal, Aerobus

However, the company has yet to secure the

president Dennis Stallings said the system

land for the project and suitable plots on Saipan

would transport passengers between the two

are scarce. It said it will eye a mix of public and

islands in 25 minutes.

private land and will bid for a plot currently

“It will turn Saipan and Tinian into one island,”

leased by rival Mariana Resort & Spa. The land

he said.

is in Marpi, one of the most coveted areas on

Aerobus can accommodate at least 10,000

the island.

passengers per hour and can start with 1,000

As part of its plans, Best Sunshine intends to

passengers per hour, but the numbers can

build the world’s largest water park and state-of-

increase depending on the demand. l

CNMI visitor arrivals Aug 29,996 Arrivals Jan to July 410,423

-30%

+12%

Mariana Entertainment is planning on opening a second electronic gaming venue on Saipan. A consultant for Mariana Entertainment, which has been operating Club 88 at Saipan Ocean View Hotel in Garapan since July, said the company has its sights set on another venue though declined to give details.

Samoa is eyeing a piece of the casino market pie, with the government calling for proposals for a 250-room hotel development in the territory to be constructed on the site of the old Rainmaker Hotel.

The government wants a major hotel brand and there is an option to include space for a casino.

the-art shopping facilities, an art amphitheatre, convention space and restaurants.

“We are searching everywhere, the entire island.

We’ve made offers to other areas also. We didn’t concentrate only on Marpi,” CEO Mark Brown was cited as saying.

“Because of the parcel of the land—where it is situated—the beauty of it. [It is] the one piece where you could put together an incredible resort. …Name another piece that big, that beautiful on the water. That doesn’t exist on the island, really.”

Yan Shen, managing director of Best Sunshine’s parent company Imperial Pacific, told Hong Kong reporters that a temporary casino opened on the island has attracted more visitors than expected.

He said the casino had averaged about 5,700 to 5,800 people a day since opening in July.

The temporary casino is to allow the company to generate revenue while its larger resort is being built.

Asia Gaming Briefings | November 2015

SUPPLIER SPECIAL REPORT 40

MGS 2015

The future of gaming The Macao Gaming Show is the first large scale gaming and entertainment exhibition organized and run by Macao organizations. MGS will have a floor area of over 10,000 meters sq. Exhibitors and buyers eyeing the Asian market will be coming from all corners of the world. expect to find everything and anything gaming

Macao Tourism and Culture Summit 2015

related across the vast exhibition space.

The Macau gaming industry has reached a

The best gaming operators from around the globe

critical stage in its development plan: it’s ready

are now thriving in Macau. The gaming supply

to jump into phase two – and quickly.

chain is also one of the largest in the world.

The Macao Tourism and Culture Summit 2015

Being an Asian hub with 48 percent of the

with Gaming Topics will be stopping at virtually

world’s population within a 5-hour flight

every stop on this economic regeneration journey.

radius, Macau enjoys the unique advantage of

Delegates can expect to hear a straight talking,

being the epicenter of Asian gaming actions.

uninhibited debate on the future of gaming in

Meanwhile, many Asian countries are now

the new vision for Macau and beyond.

aggressively developing their own gaming

The Macao Gaming Show is set to unveil a

businesses. Attending a gaming show in the

radical three-day program for its associated

he event will cover six gaming industry

capital of the Asian gaming industry will bring

conference and summit in November.

segments, including gaming equipment

boundless opportunities to exhibitors from all

Tackling the major challenges facing the

and accessories, gaming promoter and

around the globe.

industry in the Asia Pacific region, the summit

VIP clubs, casino fixtures and fittings

November is an important month for casino

will become one of the first gaming events to

and food and beverage.

operators. This is the month when they finalize

gain an insight into the Chinese government’s

The world’s biggest and most widely used

their next year budgets. MGS gives casino

One Belt One Road initiative, offering gaming

gaming equipment and accessories suppliers

managers and procurement personnel the

executives from all over the world the opportunity

will be on hand showing off the latest products

opportunity to sample the latest development

to explore the investment and development

to hit the casino floors and those coming very

in gaming equipment and services. It will be

opportunities being driven by the project in

soon. From slots, table games and hybrids to

a great opportunity for exhibitors to foster

Macau and throughout the entire Silk Road

gaming chips and shuffling machines, you can

relationships with this group of eager clients.

trading route. l

T

Asia Gaming Briefings | November 2015

SUPPLIER SPECIAL REPORT 42 AINSWORTH

High-definition line up

ARUZE

Exhibiting over 50 slots

A

ruze will be exhibiting over 50 slot machines at this year’s Macao Gaming

Show with a myriad of new titles being

A

insworth will showcase their latest line-up of product innovations

designed to set new standards for longterm performance, whilst offering players unique and dynamic entertainment experiences.

Ainsworth will debut their latest range of Asian themed standalone progressive games, Lucky Ye Ha Hai, Action 8’s and 8 Immortals!

Be enthralled by the high definition graphics encased in a spectacular A560 Dual Screen cabinet, brilliantly displaying a unique multi wheel feature. 5 wheels will appear to initialise the 8 Immortals! feature; these visually spectacular wheels will spin to determine special wild symbols linked to reels 1 through to 5. 8 Immortals is sure to build anticipation with 8 exhilarating free games providing guaranteed wild symbols and accumulating wild multipliers.

Reels of Wheels is sure to be a hit with players as it continuously rewards with 4 levels of rapid triggering Standalone Progressives.

One of Ainsworth’s most successful brands - Quad Shot - will be showing off new Asian-themed titles: Dragon Charm, Dragon Climber, Phoenix & Peony and Wings of Fortune featuring rapid trigger coinciding SAP’s and stacked wilds.

Ainsworth will be exhibiting at booth #AV40. l

Asia Gaming Briefings | November 2015

ASPECT GAMING

Revolutionizing online slots gaming

A

spect Gaming, a leading provider of social casino games, will reveal its

latest innovations for casino slots games at

showcased for their video and stepper

the Macao Gaming Show.

products. Revolutionizing the Electronic

Aspect Gaming will present its brand new

Table Game industry, Aruze will also

electronic gaming slot machine, Super

feature the new Virtual Roulette.

Ruby 2, a new slots title, Ba Xian Chuan Qi,

Virtual Roulette is the all-new Projection

and a revolutionary online slots gaming

HD roulette concept delivering hyper-

experience in their mobile and Facebook

vibrant wheel and layout display with an

game and Grand Orient Casino.

exciting side game. The high-res LCD

Aspect Gaming’s brand new Super Ruby 2

interface enhances player interaction

slot machine features a one-wall screen

by providing players intuitive graphics

that connects a player’s slot machine with

displays depending on game play and help

neighboring slot machines, adding a social

screens accessed.

factor to the slots experience.

Virtual Roulette features the electrifying

This one-wall technology allows for

Progressive Jackpot side game, called

graphics and content to be synchronized

“Jackpot Chance”. This exciting new

across multiple slot machines that feature

feature has never been experienced on a

the same slots game title. With high-

roulette table, live or digital.

definition split screens - a stunning

Now in their 4th year of commercialization

42-inch top screen display, and a smooth

and continuing to enjoy record

and sensitive 23-inch touch-screen

placements, Lucky Sic Bo, Shoot to Win

display, players are able to experience a

Craps and Lucky Big Wheel are considered

connected gaming experience with others

the industry’s leading electronic versions

nearby.

of Sic Bo, Craps and Big Six.

Inspired by the traditional Chinese story of

Aruze Gaming’s newest platform, Cube-X,

eight immortals that overcame obstacles

has the highest quality standards in

with their own unique set of abilities, Ba

manufacturing and efficiency, which

Xian Chuan Qi is Aspect Gaming’s brand

created a more streamlined platform.

new slots title with several innovative new

Subsequently, the two row Liquid Crystal

features to give players a more social and

Display Button Panel, will not only be

interactive slots experience.

visually stimulating, but also serve to

Aspect Gaming will be exhibiting at booth

provide future product support with newly

#BA29. l

released content.

Aruze will be exhibiting at booth #AQ36. l

SUPPLIER SPECIAL REPORT 43 BETCONSTRUCT

Debuting new BetCloud solution

BETSOFT

At the forefront of technology

B

etsoft Gaming, which will be exhibiting at the Macao Gaming

Show, stands at the forefront of modern

BULLS EYE

Enabling factbased decisions making

H

aving established a solid reputation across competitive Australian

jurisdictions, Bulls Eye Services has enjoyed

iGaming technology. With the advent of

recent success in the broader Asian market

the Slots3 brand in 2008, Betsoft were

in both the land based and online casino

poised to gain a solid market share with

space.

this amazing new style of video slots.

Bulls Eye has developed a suite of business

Betsoft’s proprietary Expandicon

improvement tools that assist gaming

technology set the stage for limitless

executives and investors to overcome

possibility and Slots3 has only improved

problems and leverage opportunities.

with time, creating richer, more immersive

Senior Advisor at Bulls Eye, Brett Jones, said

t Macao Gaming Show 2015,

gaming experiences for millions of players

that “Bulls Eye brings a fresh approach to

BetConstruct will demonstrate its

around the world.

problem solving. With so much information

Asian View Sportsbook and Agent System.

Slots3 is now considered to be the standard

available, and in so many forms, busy casino

Coupled with our industry leading 26,000

by which all other games are judged.

executives struggle to harness, process and

live matches per month, the BetConstruct

Betsoft employs the latest in graphics and

commercialise this valuable resource. We

Sportsbook is the most complete sports

audio technology, constantly researching

provide focus on what is important, and

betting offer for Asia today.

the most efficient methods to bring the

deliver insights based upon fact.”

We will also showcase BetCloud, our recent

content to the player without sacrificing

The team at Bulls Eye are optimistic that

innovation that allows partner operators to

any quality. This minute attention to

the broader Asian gaming market will

share the risk and reward associated with

detail illustrates the level of innovation

be attracted to their service model. Bulls

large bets resulting in increased profits

developed by Betsoft. The company’s

Eye embeds highly skilled professionals

for all. Visit us and be the first to learn the

professional team of creative artists

within a client’s business to drill down to

location of our upcoming Asian regional

originates from the AAA video gaming and

the very core of problems or opportunities.

office.

feature film industries, and they use their

This close relationships enables Bulls Eye

BetConstruct will be exhibiting at booth

talent to its fullest, producing cutting edge

to maximise the existing capability of the

#AH15. l

iGaming content on a demanding release

client to solve problems.

schedule.

Bulls Eye Services is pleased to be a sponsor

Betsoft Gaming is proud to offer the best

of the MGS Official Networking Party. l

A

mobile iGaming content on the market today. Born from the excellence of the wildly popular Slots3 collection of true 3D video slots, the ToGo line of mobile games far surpasses the quality and content of competing games.

Betsoft Gaming is Lead Sponsor of the Official MGS Networking Party and will be exhibiting at #AV29. l

Asia Gaming Briefings | November 2015

SUPPLIER SPECIAL REPORT 44 COMTRADE

iCore to engage your players

CPI

EVERYMATRIX

Comprehensive cash solutions

C

rane Payment Innovations, a Crane Co. Company, will be exhibiting the

most comprehensive portfolio of cash

Providing the platform for business

E

veryMatrix is proud to announce that it is one of this year’s sponsors of the

Official MGS Networking Party, one of

management solutions for the Gaming

the most important meeting points for

industry.

suppliers and operators in Asia.

From the MEI brand, the SC Advance

From 17th to 19th November 2015, gaming

note acceptor, EASITRAX Soft Count cash

executives, industry stakeholders and

management system and PPM Advance

some of the biggest junkets in Asia

n the overcrowded world of gaming

support tool will be on display, along

are present at the Venetian Macao to

software it can be very challenging for

with the CashCode MSM BackLoad note

explore business deals and investment

operators to find a suitable platform that

acceptor and a range of Money Controls

opportunities.

would fit their needs.

coin hoppers.

The MGS brings together an important

Comtrade Gaming, a leading independent

The MEI SC Advance note acceptor is

number of iGaming companies, but the

software provider to the gaming industry,

part of a platform that has achieved an

surprises are not limited to the exhibition

is very well aware of that. To ensure that

installed field base of more than 1.5 million

floor. Business connections and deals are

operators can deliver the best player

units worldwide. Equally impressive,

created in the social environment, that’s

experience, they created iCore, an

nearly 150,000 of those units are coupled

why visitors should attend the Official

enterprise gaming platform, designed to

with EASITRAX Soft Count, the integrated

Networking Party on November 17th.

provide a level of player engagement that

software/hardware cash management

At the same time, the schedule on display

is rarely seen.

solution that generates operational

is ready to deliver specific and significant

iCore serves as a complete online

efficiencies from the slot floor to the back

talks, like China’s increasing influence on

operation management tool that offers

room.

the Macau economy, regulation norms and

advanced marketing features, detailed

Operators typically receive a return on

the lessons to be learned from Las Vegas, a

data collection and helps manage all areas

investment within one year – or faster

similar gaming environment.

of an online operation.

with the value-added EASITRAX Web

EveryMatrix’s representatives will attend

Utilising a single central wallet, the

extension that enables customized report

the show to connect with clients, discover

platform enables effective cross-sell

creation and secure intranet access to that

new market opportunities and establish

between multiple products and channels

data from anywhere in the world.

strong connections. l

that is independent of the content

CPI will be exhibiting at booth #AK37. l

I

supplier.

The freedom and flexibility of iCore can allow seamless integration with any existing proprietary software and all external 3rd parties.

What makes iCore so special are its bonusing and loyalty features that can be delivered during real time gameplay. They promote increased average spending, prolonging the player’s lifecycle in real time and help retain customers in the long term. l

Asia Gaming Briefings | November 2015

SUPPLIER SPECIAL REPORT 45 INCOME ACCESS

Asia focus, more partnerships

F

or over 13 years, the Income Access Group has played an integral role

in supporting the growth of the global

INSPIRED

Inspired to knockout

I

nspired, a leading provider of Virtual Sports, Mobile Games and SBG Video

Lottery, will be exhibiting its latest

INTERBLOCK

Growing in Asia

L

uxury gaming manufacturer Interblock has been growing strongly and steadily

in the Asia Pacific region over the last six

iGaming and land-based casino sectors.

innovations in Virtual Sports at Macao

months. Now the company is bringing 25

As 2016 approaches, the company is

Gaming Show.

years of innovation, technical perfection,

increasingly focused on the Asian market

Inspired is currently the only regulated

and thought-leadership to the Macao

and its recent partnerships with INBET88,

supplier of virtual sports in China and is

Gaming Show.

12BET, and DongCasino.com build on

the largest supplier in the Philippines -

Interblock senior vice president of Asia

long-standing business relationships with

as well as having over 95% share of the

Pacific Cameron Louis said, “We are very

operators such as Victor Chandler Asia.

virtual sports market in UK and Europe.

excited to be coming to the Macao Gaming

Whether supporting brands in Asia or

Delegates can look forward to seeing

Show. Over the past several months, we

in other international markets, Income

Inspired’s highly anticipated new virtual

have significantly grown our presence

Access works strategically to develop and

Rush Boxing game, featuring boxing

in the Asia Pacific region, from key new

manage organizations’ online acquisition

legend Mike Tyson and Rush Football 2,

hires, to office openings, and major new

channels. Through its turnkey tracking

which boasts lifelike Ultra HD graphics

contracts.”

technology and digital marketing services,

and over 30 bet markets.

“The Macao Gaming Show will provide us

Income Access is today partnered with

Harmen Brenninkmeijer, SVP Asia and

with an excellent opportunity to present

more than 300 global brands.

Strategic Markets, Inspired, comments:

our leading electronic table games as well

Beyond the Asian market, these include

“Inspired is fast becoming one of the

as the strength of the Interblock brand.”

Sky Gaming & Betting, Betfred, Danske

household names in gaming in the Asian

Interblock will show its industry-leading

Spil, PMU, Sun Bingo, Jackpotjoy, Caesars

market. We have extensive experience

Diamond Roulette game. Diamond

Interactive, Gala Coral, and Bet Victor.

introducing regulated lottery and

Roulette is a fully automated version of

Income Access’ multi-channel tracking

gambling products to eradicate illegal grey

roulette, available with a single or double-

and analytical platform allows companies

markets and ensure tax collection – we

zero roulette wheel. Proven worldwide

to measure their marketing campaign

look forward to showcasing our industry

to be incredibly popular among players,

performance and maximise their overall

leading Virtual Sports products and

Interblock’s Diamond Roulette uses air

marketing ROI. The technology, which

meeting with potential new customers at

pressure to launch the ball onto the rim

has won eGaming Review’s B2B Award for

MGS.”

and a series of optical and proximity

‘Affiliate Software’ for the last three years,

Inspired has over a decade of experience

sensors to track the ball during its path

now includes ad serving and mobile app-

in launching highly regulated gambling

and detect its final position.

tracking functionality. l

and betting products into new

Interblock will be exhibiting at booth

international markets. At the show

#AE-32. l

Inspired will be advising government officials on the process for developing regulations to successfully launch Virtual Sports in their country.

Inspired will exhibit at booth #AK32. l

Asia Gaming Briefings | November 2015

SUPPLIER SPECIAL REPORT 46 JCM GLOBAL

JUMBO

Celebrating 60 Years of Innovation

F

or more than 60 years, JCM Global

Everything is possible

umbo is proud to present the upgraded award winning Long Dragon Baccarat this

year. The new and exciting “Long Dragon

industry-leading

Baccarat” enables the operator to link up

solutions that set

multiple baccarat games (up to eight games)

now JCM is bringing

into a single terminal. Jumbo has upgraded the players to try their luck on different

its innovative product

games without moving from one terminal

portfolio to the Macao

to another. It also provides various history

Gaming Show.

marking methods.

The show takes place

One of the most vibrant features of Long

17-19 November at the

Dragon Baccarat is Dragon Bonus. The

Venetian Macao, and JCM

Dragon Bonus focuses on continued banker

will bring a wide range of bill validation,

or player streak within the same table. The

printing, and system solutions that help

players can place a side bet on continued

operators of all sizes maintain the highest

banker or player winning streak. With each

levels of security while also creating

successful win, the payout increases. This

deeper connections with their customers.

feature can go up to as many as 20 rounds,

JCM Asia new business development

paying out 1000x return.

manager Jay Townsend said, “For 60 years,

After years of research and development on

JCM has been humbled by our success,

the behavior of players in Asian markets,

and by the ongoing support of our many

various history making methods fulfills the

customers around the world. We invite the

Asian players’ obsession over the ability to

Asian gaming industry to visit us at the

spot and exploit trends in cards.

Macao Gaming Show, to experience our

Jumbo has earned the reputation of being

award-winning product line first hand,

a trustworthy partner who delivers on our

and to celebrate our past success and the

promises. Jumbo has done so through hard

beginning of our next 60 years.”

work and dedication to the Asian markets.

JCM’s award-winning line of bill

We will continue to do so and improve upon

validation technology is led by iVIZION,

the principles the company is built upon.

the most widely used bill validator in

With Jumbo, everyone is a winner and we

Macao. JCM will also show its iPRO and

cannot wait to show the operators what we

UBA bill validators. Additionally, for

can do for you.

the first time in Asia, JCM Global is

Please visit Jumbo at booth #BA34. l

excited to present a new table product featuring a real time currency validation and reporting solution with TITO for enhancing table operations.”

JCM will exhibit at stand #AH-20. l

Innovative gaming solutions

J

has been creating

global standards, and

LT GAME

T

he Company will be displaying a variety of its products at The Venetian Macao

Cotai Expo during the Macao Gaming Show, where visitors will be able to try out all the latest Live Multi-Gaming (LMG) products, as well as brand new Electronic Table Gaming products and a Cash access kiosk that will be introduced to the market soon.

Visitors to LT Game’s booth will be able to experience a large range of gaming equipment and a new cash access system.

Demonstrating LT Game’s continuous advancements in revolutionizing the casino floor, the Company will exhibit the awardwinning LMG-6 terminal with additional gaming features, the newest Fast Betting Terminal, the innovative E-baccarat table, the brand new Power Dragon, MultiRoulette, Horse Racing terminals and the first ever currency exchange kiosk QFX (Quick Foreign Exchange) Jay Chun, chairman and managing director of Paradise Entertainment said, “The LT Game brand has been well-established on Macau casino floors, and our products have been very well received by the market as they are able to drive solid financial performance for casino operators and bring players a unique gaming experience. The company has over 3,700 terminals deployed across 18 casinos in Macau and over 200 terminals deployed in overseas casinos. We are extremely excited to continue offering different types of innovative gaming and cash handling solutions to the market, and believe that our technology will enhance casino operational efficiency and meet player needs.” LT Game will be exhibiting at booth #AV27. l

Asia Gaming Briefings | November 2015

SUPPLIER SPECIAL REPORT 47 MATSUI

Extra security, more choice

PLAYNGO

The Gaming Pro

M

P

newly designed moulding segments.

performance on smartphones, tablets,

Added to the traditional security features

terminals and websites. By combining

such as Visible & Invisible UV, Matsui

extensive experience with the latest

introduces their exclusive MG EYE security,

technology we create products that are truly

new generation EAS and latest Material

modern, complete & highly flexible. Play’n

Track security.

GO’s premium gaming content, designed for

As well as those new security features,

multi-device consumption stand out from

innovative PEARL decal chips will be

the competition and are greatly appreciated

launched at MGS 2015.

by players worldwide. The Play’n GO truly

Shigeki Machida, managing director of

independent e-gaming platform GAT –

Matsui Asia, Matsui’s Macau office, said,

Gaming Account Toolkit - delivered with a

“We are very excited to introduce those new

complete and comprehensive back-office

gaming chips as well as other core products

gives operators a unique foundation to

of Matsui such as high durable synthetic

tailor their offerings. Integrated games

layouts to our customers at MGS 2015.”

and payment services from a wide range

“We will also announce at MGS 2015 a

of providers – all managed through ONE

licensing agreement for RFID which will

heterogeneous system. We ensure that

provide even more choice and performance

our clients are equipped with superior

for Matsui Chips.”

administration tools for surveillance &

To respond to customers’ very high demand

marketing in addition to premium gaming

for Matsui’s Table Layout, Matsui recently

content. We are Play’n GO – The Gaming

expanded its production capacity. New

Pro! Play’n GO is proud to be sponsoring the

machineries and equipment have been

Official MGS Networking Party. l

atsui has extended its gaming currency portfolio through focused

investment behind the new security and

also strengthened manufacturing security for gaming chips with state of the art technology which leads it to extremely high standards.

Matsui will be exhibiting at stand #AK39. l

Bringing it all under one roof

lay’n GO is a gaming specialist and the leading mobile casino gaming

developer. Our games are designed for great

installed to further speed up and improve the quality of products while the facility has

SCIENTIFIC GAMES

A

t MGS 2015, Scientific Games will demonstrate the company is ‘stronger

together’ and uniquely positioned as a global supplier of choice for casino operators’ gaming equipment and technology by bringing the industryleading Bally, Shuffle Master and WMS brands under one roof.

Scientific Games offers an unmatched diversity of product and system solutions from across the company’s diverse array of top brands will be on display at The

INTEPLAY

Complete solutions, customized service

I

Venetian Macao.

Products on show include Da Fu Da Gui, an Asian Themed Progressive Link geared up with fantastic overhead signage.

Da Fu Da Gui, the continuation of the Duo

nteplay is a leading software company

Fu Duo Cai phenomenon with its dedicated

providing cutting-edge gaming platforms

Asian content and math model, offer

and contents for the iGaming industry.

players the anticipation of big wins with its

From start-ups to well-established

Double Luck Jackpot feature. When players

operators, we fully understand that there

reveal three Double Luck coins during

can not be any single solution suitable for

the jackpot feature, they win the current

all. Thus, we are committed to offering

jackpot amount, plus the startup amount

our partners highly customized services

of the winning jackpot level. The Da Fu Da

and making contribution to their growths.

Gui link launches with Rich Traditions and

Innovation and flexibility remain as our

Jade Eternity on the Pro Wave cabinet.

key values and we are always with you to

Also on display is Super Diamond Eternity,

achieve further success. Our LAN casino

which now joins the Super 88 Fortunes in

solution is designed for markets or areas

the SUPER game library. The standalone

which have limited Internet bandwidth and

versions of the proven performer 88

less efficient hardware. As well as online

Fortunes and Diamond Eternity will

casino, we also offer a full range of gaming

entertain players like no other with 1024

products including Mobile, Sports, Live

ways to win.

Dealer, Lottery, and Bingo. l

SG will be exhibiting at booth #AD25. l

Asia Gaming Briefings | November 2015

SUPPLIER SPECIAL REPORT 48 SPINTEC

Karma gains extra certification

V

isitors at the Spintec booth at MGS 2015 will experience the quality that

makes Spintec the major supplier of

TCS

WEIKE GAMING

Saving time, increasing revenue

T

Showcasing jackpot link

W

eike Gaming

CSJOHNHUXLEY, a live gaming

Technology, a

solutions provider, will showcase

leading local Asian

some of its impressive product

automated roulettes on Macau gaming

portfolio at the Macao Gaming Show

gaming manufacturer,

market.

in November. Focusing on leading

once again will

Spintec, whose products are present

edge table technology for baccarat and

participate in the

on the market under the brand name

sicbo, the company will present its key

Macao Gaming Show

Karma, has developed all solutions of the

solutions for optimizing game speeds and

2015.

American roulette: automated, virtual

dealer performance, increasing player

The Weike booth will

and connection to live game. Recently,

excitement and improving security.

feature an outstanding

Spintec has gained a new certificate for

“Listening to, and working with, our

line-up with a

Progressive Gaming Devices in Casinos -

customers has allowed us to deliver

market proven

GLI 12 in Macau.

solutions that drive and grow their

progressive Jackpot

A Progressive Jackpot System is already

business,” said Rebecca Kingswell,

Link and Asian

widely present on Karma roulettes

TCSJOHNHUXLEY’s managing director for

themed standalone

throughout the world, attracts more

Asia Pacific.

games.

players, and gives casinos a considerable

“This year’s Macao Gaming Show will see

Victory, an

advantage against the competitors

a range of Gaming Floor Live modules and

integrated 4-level progressive jackpot

because of the additional incentive for

enabled products that help casinos save

link launched last year together with

the players. It is very eye-catching and

time, increase revenue and improve their

the 50-line games Fortune Meow and

highly visible on LCD screens.

operations.”

Legendary Archer, has emerged as one

It operates in a manner that the system

Visitors to the stand can expect to see

of Weike favourite’s products across the

randomly picks up a lucky number from

TCSJOHNHUXLEY’s real-time gaming

region. And this year Weike brings Victory

the roulette layout and shows it on a

table management system in action. As

back again to the booth, where visitors

screen right after the bets are closed

a part of the Gaming Floor Live (GFL)

can experience its enhanced graphics,

for players but before the ball falls in

platform, the GFL Optimisation module

animation, sound and exciting winning

the wheel. In cases when the winning

will be on display and connected to

celebration.

number is the same as the lucky number,

a Baccarat table, demonstrating how

“Performing products are important

and the player has bet on it, the player

operators can gain visibility into their

to increase player engagement and

wins the Jackpot.

table operations and dealer performance.

entertainment, Weike will continue to

This likeable feature is just one of the

Also on show will be the GFL Bonusing

develop new products and also update its

many customer-oriented features of

module, demonstrating its powerful

existing products to serve the customer’s

all Karma Roulettes. The other most

floor-wide event and mystery progressive

need” said Kup Ferroth, vice president of

distinctive features of Karma Roulettes

capabilities, which enables casinos to

product marketing.

are: unbeatable comfort designed for and

configure side bet contribution ratios,

Also on display will be the standalone

around the player, intuitive interface for

jackpots, payouts etc., depending upon

games, which includes Guan YunChang,

the ease of play, extreme modularity and

regional regulatory requirements.

an exciting new 243 Ulti-Ways game with

custom-made designs.

TCS will be exhibiting at booth #Z24. l

30 credit entry bet. The game was based

Spintec will be exhibiting booth #AV36. l

on the legendary General Guan Yu, and its high multiplier chance produce a highly volatile game for all player demographics.

Weike will be exhibiting at booth #AH32. l

Asia Gaming Briefings | November 2015

SAVE THE DATE. You’re changing the game at this year’s G2E. Take the next step and build on your success.

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LAST WORD

Government needs to fine tune policies as Macau market rebalances

54

As the year grinds to a close, no one is now predicting a v-shaped recovery for the gambling industry in Macau.

Sharon Singleton*

G

ross gambling revenue has just fallen for the

that it would be getting 250 out of the 400 requested.

17th-straight month and although analysis of

Shortly thereafter, the government unexpectedly said it

the figures shows a slightly improving trend

would give a further 100 to Galaxy, which only received

sequentially month on month, the numbers

150 in the initial allocation.

are still dropping far short on an annual comparison

There has also been ongoing uncertainty about smoking.

and we’re no longer comparing with record prior year

A partial ban was imposed in October last year, with

numbers.

smoking only allowed in specially designated zones

Most operators now concede that the VIP market that

on main floor areas and in VIP rooms. After the great

made up about two thirds of total revenue may not be

expense of reconfiguring casino floors, more changes

coming back, making it crucial for operators to be able

are now being considered, though when they may be

to attract a high volume of mass market travellers.

implemented is unclear.

Melco Crown Entertainment’s Studio City opened with

Then there have been rumblings about caps on the

much fanfare on Oct. 27th, attempting to bring some

number of Chinese visitors who would be actually

Hollywood magic to Macau to drive revenue. It chose

allowed to visit Macau, coupled with restrictions on

to use its entire table allocation of 250 for the mass

third-country transit visas, which were subsequently

floor, becoming the first in Macau to do so.

eased again in July.

Morgan Stanley in recent research called the opening

Add to that the ongoing mid-term review and uncertainty

the “biggest wild card” for the industry and for Melco,

over concession renewals and it’s perhaps not surprising

highlighting the delicate balancing act that the territory

that Steve Wynn’s frustration recently boiled over very

will be facing in the next phase of its development. Non-

publicly on a conference call with analysts.

gaming is a crowd puller but a margin drag, however

He called the delays in hearing how many tables the new

on the casino side that same mass market should help

resorts will be allocated “outrageous and ridiculous,”

drive higher margins, the firm points out.

outlining how difficult it had become in terms of

Galaxy Entertainment’s Phase 2, which opened in

planning, hiring and training.

May, was disappointing as far as growing the market

The government was quick to respond, summoning

was concerned, though has helped the company’s

local executives to express its displeasure.

market share.

Still, Wynn was joined a week later by SJM Holdings

Next year, Las Vegas Sands will open its Paris-themed

Angela Leong who also called on the government to

property, while Wynn will open its $4 billion Wynn

take action to boost the economy. Her gripes centered

Palace in March.

on delays in decisions over key infrastructure projects,

With so many billions of dollars at stake and the market

such as the Hong Kong, Zhuhai, Macau bridge.

facing a rocky transition away from the high roller that

“Do you know how long we have been talking about

fueled stellar growth in GGR and made Macau one of

the bridge? Ten, 20 years. That’s a long time,” she

the wealthiest places on earth, operators could perhaps

told Bloomberg.

expect more help from the local government.

As Macau attempts to reinvent itself from a gambling

Companies have been left waiting until the very last minute

mecca for China’s billionaires to a broad-based tourism

to hear how many tables they would be allowed to fill their

destination, it faces a delicate balancing act that may

enormous new casinos, with Melco getting notice about

need a greater level of refinement from government

seven days before the opening of its $3.2 billion resort

policymakers than seen in the past. l

* Managing Editor, AGB

Asia Gaming Briefings | November 2015

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