Bloomberry Resorts Corporation, led by Filipino billionaire Enrique Razon Jr., experienced a 38 percent drop in first-half earnings, reporting a net income of PHP3.99 billion (€63.8 million).
According to its press release, the decline was largely driven by ongoing challenges in the VIP segment and the start-up costs of its new property, Solaire Resort North. In the second quarter of 2024, net income plunged 61 percent to PHP1.3 billion (€20.7 million), a significant drop from PHP3.4 billion (€54.3 million) the previous year. Despite these hurdles, Razon remains optimistic about Solaire North’s potential to drive future profitability as operations ramp up.
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Mixed performance in mass market and non-gaming segments
While the VIP segment continued to struggle, Bloomberry’s mass gaming operations showed growth. Gross gaming revenue (GGR) for the first half of 2024 fell by 6 percent to PHP29.2 billion (€465. 9 million), down from PHP31.2 billion (€497.9 million) a year ago.
However, non-gaming revenue rose by 11 percent to PHP4.6 billion (€73.4 million), showcasing strong performance in hotel and food services. The company’s flagship property, Solaire Resort in Entertainment City, reported a 12 percent decline in GGR to PHP13.3 billion (€212.2 million) due to lower VIP volumes, partially offset by growth in electronic gaming machine (EGM) revenues.
Solaire Resort North shows early promise
Despite financial strains, Solaire Resort North, which opened on May 25, demonstrated promising results. In its first 37 days of operation, the resort generated positive earnings before interest, taxes, depreciation, and amortization (EBITDA) of PHP250 million (€3.9 million), signalling its potential to become a significant revenue driver. However, pre-operating expenses for the new property amounted to PHP764.1 million (€12.2 million) in the second quarter, considerably higher than the PHP73.8 million (€11.8 million) in the same period the previous year.
Long-term outlook remains positive
Despite the challenges faced by Bloomberry, Razon remains optimistic about the company’s future. He believes that Solaire North‘s performance will improve as it continues to scale operations. The company is also banking on future growth in its mass gaming and non-gaming segments to offset the continued weakness in the VIP market.
