Net gains at Phnom Penh’s only licensed casino skyrocketed in 2007, rising 54 percent over 2006 in the 12-year-old company’s best year to date, NagaCorp, operator of the NagaWorld casino, announced.
The banner profits, which the company says are partly due to an increase in clientele from around the region, come as industry experts forecast slowing growth for the casino industry nationwide.
NagaCorp’s casino revenues in 2007 rose to $144 million, a 68.6 percent increase over 2006, while net profits rose from $32.6 million to $50.2 million, according to an annual financial statement released Friday, the company’s second since listing on the Hong Kong stock exchange in October 2006.
“We attribute it to our marketing efforts and have had an increase in local business from people with international passports,” Paul Simmons, senior vice president for operations at NagaWorld, said Tuesday.
The company in 2007 launched its Premium Players Program to attract local foreign passport holders who are permitted to gamble despite a prohibition on casino gambling by Cambodians. They acounted for 81 percent of revenues at the casino’s “public floor tables,” where walk-in gamblers, who are not part of tour groups, can bet.
Such tables also accounted for more than half of 2007 revenues, according to the statement.
The company, which is incorporated in the Cayman Islands, reported tax payments to the Cambodian government of $1.7 million in 2007.
Simmons said that while many other Cambodian casinos depend on cross-border clientele, NagaCorp draws gamblers from China, Malaysia, Singapore and elsewhere.
Mey Vann, director of the Finance Ministry’s financial industry department, said Tuesday that NagaWorld’s monopoly in the capital helped make it profitable.
Under a 1995 agreement, NagaCorp has until 2035 sole rights to operate a casino within 200 km of Phnom Penh with the exceptions of Sihanoukville, the Vietnam border area, as well as Kirirom and Bokor mountains.
Mey Vann also said that to avoid market saturation and attract more gamblers, Cambodia’s rising number of casinos, forecast to generate $20 million in tax revenues this year, should also offer entertainment and shopping.
“Gamblers may get bored if they only come to gamble,” he said.
CPP Senator Phu Kok An, owner of the Golden Crown casinos in Poipet and Kandal province, said NagaWorld is in a different league to the country’s other casinos.
Golden Crown casinos earned between $3 million and $4 million each last year, he said.
Gamblers in Poipet must contend with the frustrations of border crossings, he said, adding that if NagaWorld had competition in the capital, its margins might be thinner.
“If Phnom Penh had two to three casinos, Naga wouldn’t be making so much profit,” he said.
Political commentator Chea Vannath said Tuesday that Cambodia should find a way to ensure that gambling, a religious sin on the order of drink and womanizing, is not thrust in the public’s face.
“In Buddhism, as well as in Cambodian saying, gambling is one of the three deadly sins,” she said.