Imperial Pacific posts record interim results

Monday 22nd of August 2016

Imperial Pacific International Holdings Limited, the operator of Saipan's only casino, announced record growth in both revenue and profit for the six months to end-June, though further growth is likely to be capped until its new casino and hotel opens next year.

Total revenue reached HK$3.98 billion ($513 million), with revenue from VIP gaming operations making up the bulk at HK$3.82 billion. Mass gaming operations generated HK$122.2 million, while slots and ETGs came in at HK$26.8 million. Adjusted EBITDA was HK$1.24 billion, compared with a loss on that basis of HK$82.59 million.

Leo Chan, Imperial Pacific’s new CFO, previously the CFO of Macau Legend, commented that EBITDA at 31.5-32 percent was significantly higher than in other jurisdictions, and attributed the company’s success to its unrivaled location and natural assets, aided by more direct flights from Hong Kong and Manila.

Asked why there had been a drop-off in rolling chip volume since a high of $3.19 billion in April 2016, Chan said that they had a couple of unusually large transactions in that month which accounted for 25-30 percent of the rolling revenue. He pointed out that average rolling chip revenue has been around $2 billion over the last six months and that maximum capacity had been reached both in the casino and infrastructure-wise.

The company only has two large yachts and one villa in which to house the more than 100 VIPs who visit every month. However, new five star hotels are opening, such as the Kensington Hotel which opened in July with 313 rooms. When the Grand Mariana hotel opens in April 2017, it will have 350 hotel rooms and 15 villas.

The casino will open at Chinese New Year in 2017 with 300 tables, 180 VIP only, and 500 slot machines.

President of Global Capital Markets, Shen Yan, highlighted the company’s recent strengthening of its executive team, including Mr Chan, as well as Kwon Yiu Ling, a veteran of Macau gaming, as COO; Vic Choi, former head of compliance for HSBC China as general counsel; and the addition of Judges Eugene Sullivan and Robert James Woolsey as non-executive directors.

Commenting on the sidelines, CEO Mark Brown said that, as a conservative estimate, both rolling chip volume and also profits could double when the casino is fully open.