Unexpected Performance Growth
In recent months, the VIP gaming revenue at Philippine casinos has witnessed an unexpected surge, primarily driven by the substantial support from Korean high-end customers. With the contribution of local Chinese players and foreign tourists from Korea, Taiwan, and ASEAN countries, the Philippine gambling industry has achieved remarkable results. These impressive trends were revealed in the financial report for the first quarter of 2023 from Bloomberry Resorts Corp.
Driving Force of Korean Market Recovery
The swift recovery of the Korean market has played a vital role in reviving the high-end segment. According to analyst Miguel Sevidal’s report, the number of Korean tourists has reached approximately 70% of pre-pandemic levels, with around 71 weekly flights from Incheon to Manila. These trends suggest a promising outlook for the Korean VIP segment. Among East Asian markets, Koreans demonstrate the strongest recovery in outbound travel. While Koreans accounted for around 15% of the VIP gaming revenue before the pandemic, they now constitute the primary contributors to the market alongside Taiwan and ASEAN, representing 50% of the VIP revenue.
Return of Chinese Gamblers
In contrast to the rapid recovery in the Korean market, the return of Chinese gamblers has been relatively slower. International flight operations from China and the number of Chinese tourists arriving in the Philippines have only reached 40% and 12% of pre-pandemic levels, respectively. Bloomberry Resorts’ management has also noted a lack of significant increase in Chinese intermediary activities. Recent research indicates that the Philippines has not become the preferred destination for Chinese tourists. Nevertheless, Philippine casino operators continue to benefit from the unexpected advantages arising from the recovery in VIP gaming.
Overall Development of the Philippine Gambling Industry
The recovery in VIP gaming has provided additional benefits to the Philippine gambling industry, as domestic demand continues to be the primary driver of growth, boosting revenue from both mass-market and slot machines. Data reveals that the percentage of total gambling revenue compared to overall expenditure on entertainment and leisure in the country has risen from 22% in 2012 and 53% in 2019 to 63%.
According to Bloomberry Resorts Corp’s financial report for the first quarter of 2023, the total gaming revenue reached PHP 16 billion ($287 million), an 80% YoY increase and a 9% QoQ growth. VIP gaming revenue experienced a remarkable growth of 142% YoY, reaching PHP 6.4 billion ($115 million), while mass-market revenue increased by 27% to PHP 4.9 billion ($88 million), and slot machine revenue surged by 95% to PHP 4.8 billion ($86 million).