Bloomberry Resorts has strengthened its position as Philippines market leader in 2019, fending off the challenge of its Entertainment City neighbors due to high hold in VIP and resilience in its mass market offering at Solaire Resort & Casino, according to investment bank Morgan Stanley.
In a research note examining the company’s impressive 2019 growth story – which included a 46% year-on-year surge in gross gaming revenue at Solaire in 3Q19 – analysts Praveen Choudhary and Gareth Leung observed that Bloomberry’s GGR market share had declined from its peak of 52% in 2014 to 38% last year as a result of capacity added by City of Dreams Manila and Okada Manila.
However, Bloomberry has regained market share over the past two quarters, rising from 34% in 4Q18 and 1Q19 to 36% in the second quarter and 41% in the third. That 3Q19 market share figure compares with 24% for Okada Manila, 18% for Resorts World Manila (RWM) and 17% for City of Dreams Manila.
While detailed third quarter results for RWM are no longer available due to its parent company Travellers International Hotel Group delisting from the Philippine Stock Exchange before it could report in October, Morgan Stanley said that Bloomberry has “nevertheless been gaining shares in both VIP and Mass over 1Q19 and 2Q19” and following a similar trend in 3Q19.
The analysts estimate that Bloomberry’s FY19 share of Entertainment City VIP, including RWM, will grow from 37% in 2018 to 40%, while mass will rise from 37% to 38%. Excluding RWM, Bloomberry and Solaire hold 47% of the VIP market and 43% of mass through the first nine months of 2019.
“We estimate a 16% GGR growth in 2019 for Bloomberry, driving EBITDA growth to 41%, and so it should remain the market leader in 2019,” the note said.
Morgan Stanley also maintained its positive view of the Philippines market as a whole moving forward, stating “it should continue to grow faster than the economy, driven by low penetration, a stronglocal economy, supply additions, Chinese visitor arrivals, better VIP margins, favorable policies and infrastructure improvement.”
IR revenue from the big four grew 14% in 3Q19, “moderating from +17% in 1H19 and +27% in 2018 but still healthy,” the analysts added.
“We forecast group GGR to grow at 11% YoY in 2019, moderating from 2018, but still stronger than other regional markets, such as Macau.”
