• Resorts World 2015 profit down 26% on forex losses

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    LISTED Travellers International Hotel Group Inc., the operator of Resorts World Manila (RWM), said its net income dropped last year due to foreign exchange losses incurred during the period.

    In a disclosure to the Philippine Stock Exchange (PSE) on Thursday, the partly Andrew Tan-owned hotel and gambling unit said net profit declined by 26 percent last year to P4.01 billion from the P5.44 billion realized in 2014.

    “The company focused on building a base in 2015, particularly in the mass and premium mass segments. Operating costs were controlled as the company remained profitable even as revenues declined,” Travellers said in its statement.

    Unrealized foreign exchange losses stood at P765 million due to the strengthening dollar versus the peso.

    Traveller’s said that its 2015 full-year net income would have been higher by 19 percent had the exchange rates remained the same with 2014 levels.

    Net revenues, which came mainly from gaming operations, fell by 15 percent to P24.6 billion from the prior year’s P29.6 billion.

    Drops volume, or the money wagered on the table, for the company’s mass segment decreased by 2.7 percent while the VIP segment contracted by 31.7 percent.

    Traveller’s win rate, meanwhile, has improved with a blended rate of 4.8 percent versus the 4.2 percent registered in 2014, while the VIP segment marginally improved to 2.8 percent in 2015 from 2.5 percent in the previous year.

    Earnings before interest, taxes, depreciation and amortization (EBITDA) was down 22 percent at P6.16 billion against the P7.91 billion posted in 2014.

    Direct costs, which are associated with the gaming revenues and with hotel, food and beverage, and others, decreased 2.5 percent to P10.5 billion, while general and administrative expenses dropped 21.5 percent to P9.4 billion.

    “We remain committed to deliver quality earnings to our shareholders as we continue to accomplish operational efficiency while further beefing up our non-gaming capabilities,” said Kingson Sian, president and chief executive officer of Travellers International.

    The second phase of expansion of Resorts World Manila is nearly complete with the Marriott West Wing, which will add 228 hotel rooms and is on track for operations in 2016, the company said.

    The third phase is scheduled to start construction by the end of 2017 and will consist of three hotels—Hilton Manila, Sheraton Manila Hotel and Maxims II. Phase three likewise includes additional gaming areas, retail space and six basement parking decks.

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