Figures released by the Philippine Amusement and Gaming Corp (PAGCOR) showed the nation’s total casino gaming revenue in the three months ending June 30 rising 30% to PHP 34.2b (US $715.3m).
PAGCOR’s own casinos (which are soon to be privatized) weren’t the chief engine of Q2 growth, as their revenue was up only 6% to PHP 8b. But the privately run PAGCOR-licensed casinos had a much better time, rising 40% to PHP 26.1b. Of this, PHP 22.6b was generated by the resorts in Manila’s Entertainment City gaming zone (as well as Resorts World Manila).
The private casinos got most of their Q2 gains from junket operators steering VIP gamblers to their properties. While non-junket gaming revenue improved 22% to PHP 10.2b and slots improved 12% to PHP 6.9b, junket-derived revenue more than doubled to PHP 9b.
Maybank ATR Kim Eng Securities analyst Rommel Rodrigo issued a note saying the Manila casinos’ gains were aided by the availability of so-called proxy betting, in which a trusted proxy sits at the gaming table, relaying card information over the phone to a VIP who advises the proxy how to wager.
Rodrigo noted the Manila casino gains stood in stark contrast to the stagnant markets in Macau and Singapore. Macau put the kibosh on proxy betting earlier this year, and while the ban isn’t foolproof, Macau’s already suffering junkets have apparently decided to take their proxy business to more tolerant casino markets.
Over a year ago, Morgan Stanley analysts estimated that while proxy betting made up between 5% and 10% of Macau’s VIP gaming revenue, Manila’s casinos could be deriving up to half of their VIP gaming revenue from proxy betting. This January, Frontier Capital Group made it plain that proxy betting would be a key driver of its new Philippine casino in the Clark Freeport Zone.