According to a report, the Philippine government may face challenges in finding buyers for PAGCOR’s 44 Casino Filipino sites, as they are outdated and require significant investments for upgrades.
The Philippine government’s planned sale of its state-owned casinos is unlikely to pose a competitive threat to the private sector, according to a report Maybank Securities Inc. Analyst Miguel Sevidal has indicated that potential buyers may face significant expenses for upgrading facilities and incorporating new technology, potentially making them less appealing for purchase. Sevidal further highlighted that out of PAGCOR’s 44 Casino Filipino venues, only ten are in close proximity to Entertainment City, which is home to private sector operators like Solaire Resort and Casino, Okada Manila, City of Dreams Manila, and Newport World Resorts.
According to Sevidal, unless valuations become more attractive, interest in these venues is likely to remain low. Additionally, he noted that Casino Filipino outlets primarily serve the local mass market and may not experience a significant boost from the recovery of foreign tourism in the Philippines.
Maybank further stated that the potential sale of PAGCOR operations could result in an increased exposure to the local mass market for existing private-sector operators, which could potentially add 10 percent to Entertainment City’s gross gaming revenue. In the fourth quarter of 2022, Entertainment City properties generated nearly PHP44.06 billion, accounting for approximately 78.7 percent of the entire industry’s gross gaming revenue.
In March, Alejandro H. Tengco, Chairman and CEO of PAGCOR, stated that the regulator-operator was actively considering the privatization of all PAGCOR-operated casinos to separate its regulatory and operating functions. He estimated that the Philippines could generate approximately PHP80 billion (US$1.47 billion) from the sale of these casinos.
PAGCOR has announced a net income of US$317.97 million for the first quarter
PAGCOR has reported a robust net income of PHP1.87 billion (US$303.19 million) for the first quarter, marking a significant increase of 42.6 percent compared to the same period last year when it was PHP624.7 million. The revenue from gaming operations also showed substantial growth, rising by 49 percent year-on-year from PHP11.29 billion to PHP16.87 billion (US$303.19 million).
Furthermore, the reported figure reflected a solid 13.61 percent increase compared to the previous quarter. PAGCOR’s profits for the first quarter totaled PHP1.33 billion (US$24 million), demonstrating an impressive growth of 114 percent compared to the previous year and surpassing its target by a remarkable 423.39 percent.
In March, PAGCOR announced an ambitious target of PHP244.84 billion (US$4.5 billion) in gross gaming revenue (GGR) for 2023, as the local gaming industry continues to gain momentum. This target represents a significant increase of 33.1 percent compared to the previous year’s target and a notable 14.2 percent higher than the 2022 GGR.