Casino operator Imperial Pacific International Holdings failed to set a new VIP gambling turnover record in October but came awfully close.
In a filing with the Hong Kong Stock Exchange on Wednesday, Imperial Pacific said VIP turnover at its temporary casino on the island of Saipan hit $3.84b in October. The total is the second highest since the casino opened one year ago, and only slightly off September’s record $3.95b tally.
Imperial Pacific’s local subsidiary Best Sunshine International opened its ‘training facility’ in an upscale mall in October 2015 while awaiting completion of its permanent Saipan venue, which is scheduled to commence its phased opening in February 2017.
Imperial Pacific had until recently relied on direct relationships with its VIP clientele but September saw the Commonwealth Casino Commission issue its first junket operator license. Over a dozen other junkets are awaiting licensing scrutiny, but the Commission says it will only consider applicants that have been pre-approved by Imperial Pacific, as it’s the only game in town.
China’s recent arrest of Crown Resorts staffers for allegedly marketing to Chinese VIPs has led multiple analysts to warn that all Asia-Pacific casino operators could face a downturn if China places more curbs on VIP gambling activity. Fitch Ratings singled out Imperial Pacific as being particularly vulnerable if China tightens the VIP screws.
Analysts at the CLSA brokerage recently determined that Chinese nationals accounted for over 80% of Imperial Pacific’s gambling revenue, about the same ratio as casinos in Macau but much higher than the 60% in South Korea, 30% in Singapore and 25% in the Philippines.
Macau casinos may be similarly reliant on Chinese customers but Macau is increasingly less reliant on Chinese VIPs thanks to its burgeoning mass market segment. Meanwhile, Imperial Pacific is almost entirely focused on the VIP segment. What was that old maxim about not putting all your eggs in one basket?
