City of Dreams Manila is banking on gaming revenues from the VIP segment to end the year strong.
The Philippine Star quoted Belle Corp. Vice Chair Willy Ocier, who said, “the second half of 2015 will be strong. COD just started VIP operations in July 2015.”
VIP junket operators act as facilitators for casinos, especially in Macau where they guarantee a substantial amount of revenue from China’s high stakes gambler. But the recent crackdown of the Chinese government has affected many VIP gaming lounges in the city state, prompting operators to look elsewhere for profits.
In fact, the SunCity Group had already announced its plans to open four more VIP rooms in the Philippines, particularly at Bloomberry Resort’s Solaire Resort & Casino and the City of Dreams Manila.
Even Lawrence Ho, chief executive of Melco Crown Entertainment (MCE), had already expressed his suspicion that Macau’s VIP market “will never be what it once was.”
City of Dreams Manila is a joint venture between Melco Crown and Belle Corporation. The 6.2 hectare property features VIP and mass-market gaming facilities with capacity for 380 gaming tables, 1,700 slot machines and 1,700 electronic table games. Its non-gaming offerings include hotel, retail, food and beverage and entertainment facilities.
The integrated resort, however, has not had a good year. City of Dreams Manila reported a revenue of $75 million and earnings of $12.5 million in its first full quarter of operations. Its VIP turnover came in at $495.8 million, while mass table drop was $116.6 million, slots handle was $465.1 million, and non-gaming revenue came to $28.6 million.
This prompted the casino management to trim its manpower, laying off close to 2 percent of its total workforce as part of cost rationalization. Ocier said “operations may have overestimated its manning requirements,” leading to the layoffs.
According to MCE’s local subsidiary, Melco Crown Resorts Corp., the layoffs were only temporary and the employees will return to work when the business “picks up.”
City of Dreams Manila is the second integrated resort that opened in the 120-hectare Pagcor Entertainment City, following Solaire Resort and Casino. Two more casino resorts are expected to open in the next few years: Universal Entertainment and Tiger Resorts’ Manila Bay Resorts, and Genting Group and Alliance Global Group’s Resorts World Bayshore.
