ArrowArtboardCreated with Sketch.Title ChevronCrossEye IconIcon FacebookIcon LinkedinShapeCreated with Sketch.Icon Mail ContactPath LayerIcon MailMenu BurgerIcon Opinion QuotePositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Business

High rollers warm up to Vladivostok casino

The Tigre de Cristal, Vladivostok's new luxury casino complex, has welcomed thousands of foreign tourists.

HONG KONG -- Asian high rollers have begun turning up at a new casino established by Hong Kong's Lawrence Ho in Vladivostok, Russia even as they shun the grand gaming palaces of Macau run by Ho and others.

Tigre de Cristal, which opened last October, generated more than 2 billion Hong Kong dollars ($260 million) in monthly VIP betting volume in both July and August, according to figures published by controlling shareholder Summit Ascent Holdings late Wednesday.

The monthly betting volume, which had previously peaked at HK$739 million in May, surged after VIP rooms were assigned to two junket agents in late June. The new inflow has also seen the Tigre de Cristal almost completely fill its 121 hotel rooms on weekends and bring weekday occupancy above 66%. The casino plans to assign a VIP room to another agent soon. The casino, which opened with eight VIP tables, now has 14.

By comparison, VIP betting volumes at City of Dreams, Ho's flagship casino in Macau, fell 10.8% in the April-June quarter from a year earlier, but still totaled $9.9 billion.

Investors welcomed Summit Ascent's update, pushing its shares up 9.3% Thursday in Hong Kong to HK$1.99. The company also reported a net profit for the first half of HK$1.7 million compared to a loss of HK$43.8 million for the same period last year.

Shares in Melco International Development, Ho's flagship company, climbed 8.4% on Thursday after the company announced a jump in profit to HK$10.37 billion from HK111.1 million for the first half as it began consolidating the financial results of Melco Crown Entertainment, the operating company for Ho's casinos in Macau and Manila, and declared a special dividend of 1.5 Hong Kong cents a share.

The question facing Summit Ascent will be whether VIP traffic from China, Korea and Japan to its $172 million casino holds up when the weather gets colder. In its last financial update, Summit Ascent reported a big drop off in overall visits from non-Russian patrons over the winter months.

Meanwhile, betting by lower-stakes players has been stagnant, with the August figure reaching around 303 million rubles ($4.6 million), the lowest monthly total since the casino's first month. While high rollers gamble on credit extended by the casino or junket agents, lower stakes players bet with cash, but Russian law forbids use of foreign currencies to settle gaming wins and losses. With the ruble weak, Chinese and other visitors have been reluctant to convert money into rubles, Summit Ascent said; the company is lobbying the government to change the currency rules as well as step up implementation of expedited tourist visas. The company said that Russian economic weakness discouraged local players from betting more.

In apparent reaction to these conditions, Summit Ascent said in its update that it would push back the opening of the next phase of its Vladivostok project, which is to include another gaming floor and two hotels, to the first half of 2019 from the second half of 2018. The beginning of construction would be delayed a year to the second half of 2017. The company announced a preliminary agreement with South Korean casino operator Kangwon Land on Aug. 12 for possible joint investment in the new project. Cambodian casino operator NagaCorp and two Russian companies are also developing casino hotels in the same gaming zone.

Investors welcomed Summit Ascent's update, pushing its shares up 9.3% Thursday in Hong Kong to HK$1.99. The company also reported a net profit for the first half of HK$1.7 million compared to a loss of HK$43.8 million for the same period last year.

Shares in Melco International Development, Ho's flagship company, climbed 8.4% on Thursday after the company announced a jump in profit to HK$10.37 billion from HK111.1 million for the first half as it began consolidating the financial results of Melco Crown Entertainment, the operating company for Ho's casinos in Macau and Manila, and declared a special dividend of 1.5 Hong Kong cents a share.

You have {{numberReadArticles}} FREE ARTICLE{{numberReadArticles-plural}} left this month

Subscribe to get unlimited access to all articles.

Get unlimited access
NAR site on phone, device, tablet

{{sentenceStarter}} {{numberReadArticles}} free article{{numberReadArticles-plural}} this month

Stay ahead with our exclusives on Asia; the most dynamic market in the world.

Benefit from in-depth journalism from trusted experts within Asia itself.

Try 3 months for $9

Offer ends September 30th

Your trial period has expired

You need a subscription to...

See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

See all offers
NAR on print phone, device, and tablet media