The Philippine Amusement and Gaming Corp. (PAGCOR) saw its first half revenues slide 5.2 percent to Php19.96 billion after suffering a 26-percent decline in other related services, most notably the lower license fees paid by gambling casinos.
The first half revenue numbers are down from the Php21.06 billion the government-owned agency earned in the same time last year. The overall income from other related services reached Php4.07 billion, a decline from the Php6.02 billion registered this time the last year.
PAGCOR argued its case in the Philippine courts to no avail after Bureau of Internal Revenue (BIR) imposed a 30-percent income tax on casino operators. The agency was forced to lower the license fees from 15 percent to 5 percent of gross gaming revenue from VIP tables and from 25 percent to 15 percent from mass-market tables, slots and e-gaming machines. It reported a gaming income of Php14.89 billion in the first half of the year, a shade over 1 percent better than the Php14.73 billion it earned in the first half of 2013. However, that’s about the only gains the agency made in the first six months of the year.
Its net income also declined 6 percent from Php1.4 billion to Php1.32 billion, cutting into its remittances to other government agencies to Php9.4 billion from Php10.64 billion, an 11.6 percent drop compared to last year.
PAGCOR’s declining revenue numbers hasn’t reduced the enthusiasm of the gaming industry, which is expected to continue growing in the years to come. The burgeoning industry even caused the information technology-business process management sector to prepare for the increased competition brought by the rise of the country’s gaming and tourism industry.
“The growth of the tourism industry is a potential threat to us in the sense that they will try to tap the same talent pool,” Information Technology and Business Process Association of the Philippines (IBPAP) President and CEO Jose Mari P. Mercado told the Philippine Daily Inquirer last week.
Melco Crown‘s recent announcement of offering 8,000 job opportunities for City of Dreams Manila is a perfect example of this increased competition. Most of the qualifications and profiles required by the company are similar to the IT-BPM industry’s own requirements. Mercado also pointed out that the hotels have become more aggressive on mass hiring in the past few years, a stark difference from the time when most hiring batches consisted of only 10 to 20 new employees. These days, hotels have adopted a mass-hiring process akin to what BPO companies have always done.
City of Dreams Manila is the second of four integrated resorts to open in PAGCOR’s Entertainment City after Solaire Resort & Casino. Next year, Kazuo Okada’s Manila Bay Resorts is scheduled to open and the year after that will be Resorts World Bayshore‘s turn to open.
Both integrated resorts will also be in the market for thousands of employees and with it comes the possibility of more employees eschewing BPOs in favor of the booming gaming industry.
