SkyCity profit falls as high-rollers do a runner; MGM sues action star’s daughter

TAGs: Australia, MGM Grand paradise, MGM Macau, New Zealand, skycity

skycity-fake-casino-whaleThe company behind MGM’s casino in Macau is suing the daughter of Hong Kong actor/director Philip Chan Yan-kin for allegedly refusing to pay a HKD 4.25m (US $548k) marker. The South China Morning Post reported that MGM Grand Paradise has accused Joanne Chan Jo-yan of running up a HKD 7.5m gambling tab over five days at the MGM Macau casino last Christmas. MGM claims Chan repaid HKD 3m between May and June, but has so far failed to cover the outstanding balance. Chan’s father has appeared in numerous Hong Kong film productions, including the classic Hard Boiled with Chow Yun-Fat, as well as Jean-Claude Van Damme’s Bloodsport and Jackie Chan’s Supercop.

Reneging high-rollers are also being blamed for a dip in Australia-New Zealand casino operator SkyCity Entertainment Group’s annual results. The company, which owns or operates four casinos in New Zealand and two in Australia, claims a group of 20 Asian gamblers ran up a NZD 2.4m (US $1.9m) tab over a couple days at the company’s flagship Auckland property in the first half of the fiscal year, then did a runner without settling up.

Managing Director Nigel Morrison said the company is still pursuing the deadbeats, who he claimed had hit a number of other regional casinos around the same time. Morrison said several members of the group were registered as high-rollers at other casinos, which enabled them to wager on credit at SkyCity Auckland. Morrison said such incidents were “a fact of doing business in this space,” and stressed that the casino advances around $100m worth of credit to high-rollers every year, so a bit of perspective was needed.

SkyCity’s revenue of NZD 947.8m ($755m) during the 12 months ending June 30 was up a mere 0.3% from the year before, but profit fell 8.1% to NZD 127m ($101.2m). Along with the effect of the faux high-rollers, Morrison blamed at least some of the “somewhat disappointing” profit dip on the influx of visitors in late 2011 when New Zealand hosted the Rugby World Cup and the December 2012 sale of SkyCity’s 50% stake in the Christchurch Casino, two factors that contributed a combined NZD 8.8m to the previous year’s profit figure. Excluding one-time items, FY 2013’s normalized profit rose to NZD 137.1m from NZD 133.6m in 2012.

Looking ahead, the company expects a bump from having concluded agreements with governments in New Zealand and South Australia to expand SkyCity facilities in Auckland and Adelaide that Morrison says “will underpin future growth.” Former Crown Melbourne exec Craig Ashton will join SkyCity in September with a mandate to boost Asian high-roller traffic in Auckland, Darwin and Queenstown. Friendly word of advice for Ashton: be sure to personally check all blowholes to make sure you’re not dealing with minnows in whale suits.


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