Hong Kong-listed casino operator and developer NagaCorp Ltd, known for its flagship NagaWorld integrated resort in Phnom Penh, reported sound business performance in the six months to June 30, which it largely attributed to the return of ASEAN tourists and Chinese business travellers to the Kingdom.
In its July 19 interim financial report, the company posted “a positive business recovery during the period” and “steady year-on-year growth across key financial metrics”.
Gross gaming revenue (GGR) increased by 7.9 per cent year-on-year to $252.3 million, net profit surged by 57.4 per cent to $83.0 million, and EBITDA (earnings before interest, taxes, depreciation, and amortisation) gained 10.1 per cent to $143.2 million.
The report attributed the company’s “54.4 per cent” EBITDA margin to “the Group’s relatively stable performance with gradual recovery of visitation from neighbouring countries and strong focus on the captive domestic market”.
“The Group continued stringent cost control measures and operational efficiency initiatives, resulting in a higher profit margin,” it said. “The positive results were mainly attributable to business volume growth across all business segments.”
“The company continues to benefit from the growing domestic captive market in Cambodia which has proven to be a self-sustaining business, with recurring visitation to the property during the period.
“The revival of the global tourism industry appears promising, and Cambodia is showing a substantial recovery in its tourism sector. The continuous influx of international tourist arrivals has been contributing to the socio-economic activities in all sectors,” it added.
Average business volume for mass market gaming rose by 3.7 per cent quarter-on-quarter to $10.1 million in April-June, from $9.8 million in the preceding three-month period.
Average daily rollings in “premium VIP” improved by 8.6 per cent quarter-on-quarter from $10.8 million to $11.8 million and in “referral VIP” by 40.9 per cent from $4.3 million to $6.1 million.
According to the report, this indicates that average mass volume and premium VIP average rolling volumes were at 83.9 per cent and 97.9 per cent of peak 2019 levels. “Both the Mass Market and Premium VIP Market collectively contributed about 90 per cent and 93 per cent of the company’s total GGR and gross profit for the period, respectively,” it said.
On the Hong Kong exchange, NagaCorp’s (3918:HK) share price remained flat to close at HK$4.54 on Friday, July 21 for a market cap of HK$20.08 billion (US$2.57 billion), 52-week range of HK$3.497-7.797 and trailing price-to-earnings (P/E) ratio of 18.63, with 916,289 shares traded or 56.46 per cent of the 65-day average of 1,622,976, according to the Wall Street Journal.
Meanwhile, the Ministry of Tourism revealed that Cambodia received 2.580 million international visitors in the first half of the year, the equivalent of 77.28 per cent of the record 3.338 million recorded in the same time of 2019.
Tourism minister Thong Khon late last month stated that his ministry hopes that the total for the entire year will surpass 4.5 million, which would be 68.07 per cent of the 6.611 million tallied in 2019.
Similarly, in a recent report on the Kingdom’s tourism plans through to 2024, tourism ministry permanent secretary of state Tith Chantha revealed that the government expects Cambodians to make 16 million domestic tourist trips this year. As of end-May, that number stood at 10.043 million.
According to the ministry, domestic tourist trips by locals clocked in at 13.934 million last year – representing a weekly average of 273,986 – exceeding 2019’s 11.320 million by a commendable 23.10 per cent.
A visitor in the context of these statistics is a person travelling to the Kingdom, “staying at least overnight and not exceeding a specific period for leisure, recreation, business and other legal tourism purposes; and not relevant to the purpose of permanent residence or any remunerated activities”, as defined by the ministry.