Bloomberry Resorts & Hotels Inc. (BRHI), the operator behind Manila’s renowned Solaire Resort Entertainment City and Solaire Resort Quezon City, has made a noteworthy investment in its parent company, Bloomberry Resorts Corp. The investment, valued at approximately USD 263,000, involves the acquisition of nearly 2 million shares intended to reward casino patrons. This decision comes in the wake of a reported decline in gaming revenues and EBITDA, signaling both a strategic shift and an effort to maintain patron engagement amidst financial challenges.
Investment Details
According to a recent filing, Bloomberry Resorts & Hotels Inc. purchased a total of 1,940,000 shares of Bloomberry Resorts Corp. through the Philippine Stock Exchange. The transaction was executed at market prices ranging from PHP 7.50 to PHP 7.70 per share, culminating in an overall investment of PHP 14,887,111, which translates to approximately USD 263,000. These shares are earmarked to be distributed to loyal patrons of Solaire as part of a broader marketing strategy designed to enhance customer loyalty and engagement.
Financial Performance
This investment comes against a backdrop of financial difficulties for Bloomberry Resorts Corp. In its latest quarterly report, the company disclosed a 4% year-on-year decline in gross gaming revenues. This decrease is compounded by a significant 33% drop in EBITDA for the second quarter of 2024. The decline has been attributed to persistent weaknesses in the VIP gaming market, which has been struggling to rebound to previous performance levels.
Despite these financial setbacks, Bloomberry Resorts Corp. has introduced a new dividend policy. Under this policy, the company will distribute annual dividends equal to 35% of the prior year’s audited consolidated Earnings Per Share (EPS). This move is aimed at providing consistent returns to shareholders even as the company navigates through challenging market conditions.
Strategic Response and New Developments
In a strategic maneuver to bolster its position, Bloomberry recently inaugurated its second integrated resort, Solaire Resort North. Remarkably, within the first 37 days of its operation, the resort achieved a positive EBITDA. This accomplishment is particularly noteworthy given that several gaming and non-gaming facilities were yet to be launched during this initial period. This positive performance indicates the potential for Solaire Resort North to contribute significantly to Bloomberry’s recovery and growth.
Impact of the Share Purchase on Patron Relations
The decision to purchase shares and distribute them to casino patrons can be seen as a strategic effort to enhance customer loyalty and engagement. By aligning the interests of its patrons with the success of the parent company, Bloomberry aims to create a more invested and enthusiastic customer base. This approach not only serves as a reward mechanism but also as a marketing tool to attract and retain high-value patrons in a competitive market.
Bloomberry Resorts & Hotels Inc.’s recent acquisition of shares in its parent company, combined with the introduction of a new dividend policy and the successful launch of Solaire Resort North, highlights the company’s multifaceted approach to navigating financial challenges. While facing a decline in gaming revenues and EBITDA, Bloomberry remains proactive in strengthening its market position and rewarding its loyal patrons. The strategic allocation of shares to casino guests and the implementation of a new dividend policy underscore Bloomberry’s commitment to long-term growth and shareholder value amidst a fluctuating gaming industry landscape.