IAG December 2015

REGIONAL
BRIEFS
Wynn Palace opening delayed
until June 2016
Wynn Resorts Ltd – the parent company of local casino operator
Wynn Macau Ltd – has announced that the opening of its new Cotai
property Wynn Palace has been delayed until June 2016.
Just four months after setting an opening date of 25 March
2016, Wynn Resorts was forced to amend their expectations after
being informed by their general contractor, Leighton Holdings Ltd,
that the project would not be ready in time.
The revised date has officially been set as 25 June 2016.
However, investment analysts have widely predicted there
would likely be no change to the US$4.1 billion construction budget,
nor would the delay have any significant impact to the company’s
bottom line.
“While we are surprised by the announcement, given our
negative view of the impacts of new supply into the current market
climate, we don’t think the three-month delay is entirely meaningful
from a fundamental perspective,” said Deutsche Bank gaming
analyst Carlo Santarelli.
The delay has been blamed on a range of factors including
labor shortages and the Macau government’s tendency to delay
the issuing of necessary permits at various stages of construction
in order to ensure the opening dates of Cotai’s under-construction
properties are staggered.
But Santarelli said it was more likely down to on-site difficulties.
“They have experienced due course construction delays, some
of which stem from the level of the expectation for the quality of the
finishing work,” he said.
Wynn Resorts Chairman Steve Wynn was recently critical of the
Macau government for failing to inform casino operators of how
many new-to-market gaming tables their new properties would be
granted until shortly before opening. Most had previously budgeted
for between 500 to 600 new tables but the two big properties to
open so far – Galaxy Phase II and Studio City – have received just
150 and 250 respectively.
When it finally opens, Wynn Palace will feature a 1,700 room
hotel along with a lake with water displays and a gondola ride.
South Korea’s only locals casino
continues to flourish
The operator of the only casino in South Korea where locals are
allowed to gamble has announced a 12.8% net income increase
year-on-year for the third quarter of 2015.
In a filing to the Korean Exchange, Kangwon Land Inc reported a
net income of KRW119 billion (US$103 million) in the three months to
September 30. This included an increase in revenue from sales of 5% to
KRW413.5 billion and in operating income of 18.9% to KRW157.9 billion.
The revenue increase was also a significant improvement on the
previous quarter, with revenue up 6.3% and net income up 22.2%.
Daiwa Securities Capital Markets Korea analyst Thomas Y Kwon
predicts Kangwon Land Inc’s profit will continue to grow in the
following months.
“We think the company would likely see solid visitor growth
and gaming demand for slots and mass-table games in the fourth
quarter of 2015 and 2016,” he said in a note.
“We forecast Kangwon Land’s revenues and operating profit
to increase by 9.9% year-on-year and 14.6% year-on-year in 2016
respectively.”
The South Korean government is preparing to issue up to two
new licenses for integrated resorts with casinos that would only be
open to foreign players. The issuing of any license is dependent on
the successful party committing to an investment of at least KRW1
trillion (US$890 million).
It is believed that as many as 34 groups had initially submitted
applications with that number since reduced to nine remaining
contenders battling it out for the two available licenses.
This is despite the fact that the impact of the current economic
climate in China appears to have stretched beyond Macau, with profits
at Korea’s foreigner-only casinos having fallen throughout 2015.
South Korea currently has a total of 17 operating casinos with 16
of them available only to foreigners.
Kangwon Land casino
Macao Gaming Show to take
next step in 2016
The Macao Gaming Show will return in 2016 ready to move to take
the next step in its evolution following the success of MGS 2015,
according to the Chairman of organizing body the Macau Gaming
Equipment Manufacturers Association, Mr Jay Chun.
Mr Chun said the third edition of the trade show, which ran
from 17 to 19 November at the Venetian Macao, was “the greatest
platform for MGS to move forward to the next level” after attracting
over 100 exhibitors.
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inside asian gaming December 2015