Singapore’s two casinos are both facing a shortage of high-rolling players brought about by China’s continued crackdown and the country’s economic slowdown. With business down in the VIP tables, Las Vegas Sands and Genting are fighting over what they can get, both on and off the gambling floor.
Las Vegas Sands Chairman Sheldon Adelson threw the first salvo, criticizing Genting for ramping up its credit and incentive programs just to get more players in their establishments. “Maybe one day, they will get used to competing on the basis of a quality product, if they ever build one, and they won’t have to buy the business,” Adelson said, referring to Genting’s 61% increase in its “trade and receivables” or money owed by customers to stand at $1.2 billion in the quarter ending June 2014 from June 2012.
Las Vegas Sands isn’t far behind with its own gross casino accounts receivables, which hit $984 million at the end of September 2014, up 10% from its numbers in September 2012.
Genting didn’t respond to Adelson’s comments but President Tan Hee Teck did say during his company’s earnings call in August that the current sparsity in VIP gamblers could continue putting the clamps on the casino industry in Singapore. “I suppose some operators may not want to admit it but at least from our side, we believe that the situation will continue to be quite challenging at least for the next 6 to 12 months,” Tan said.
Tan’s concerns stem from a steep drop in Chinese visitors to Singapore, which Singapore’s tourism board said fell 30% to 871,000 in the first half of the year. Both Las Vegas Sands and Genting greatly rely on these wealthy high rollers to play in their casinos. It’s a small segment that accounts for half of the $6 billion in annual gaming revenues both firms combine to generate.
Las Vegas Sands admitted in its latest earnings call last month that VIP volume at Marina Bay Sands fell 34% in the 3Q of 2014 and Genting will likely report similar numbers.
