COD Manila operator rethinks PH strategy
As the e-gaming sector gains further traction in the Philippines, integrated casino resort operator Melco Resorts & Entertainment Ltd. has announced its plan to explore “potential strategic alternatives” for City of Dreams Manila.
The Nasdaq-listed company, in a statement over the weekend, said it had kept CBRE Capital Advisors, Inc. and Moelis & Company LLC as financial advisors as it decides on its next move for the 6.2-hectare luxury resort and casino complex in Entertainment City, Parañaque.
“No decision has been made regarding any strategic alternative and there can be no assurance that the exploration of potential strategic alternatives will result in any transaction,” said the developer and operator of integrated resort facilities in Asia and Europe.
“Melco does not intend to comment on or provide updates in relation to this process unless and until it determines that further disclosure is appropriate or required,” it added.
City of Dreams Manila is operated by Melco Resorts Leisure (PHP) Corp., a subsidiary of Melco, in line with the operating agreement entered into by the Melco group and local partner Premium Leisure and Amusement Inc. (PLAI).
PLAI, which was acquired by Belle Corp. in 2011, holds a license to operate integrated resorts, including casinos.
In its latest financial report, City of Dreams Manila saw its operating income drop by 19 percent to $89.1 million from $110.14 million in 2023.
For its hotel operations, the company’s average daily rate went down to $164 last year from $177 in 2023. This is calculated by dividing the total room revenues by total occupied rooms.
The revenue per available room, meanwhile, also dropped to $158 from $171.
The gaming sector in the country has been seeing a shift as Filipinos become more familiar with online gambling platforms.
The Philippine Gaming and Amusement Corp. (Pagcor), which has announced the shutdown of unprofitable casinos, is expecting the e-gaming sector to step up to the level of brick-and-mortar casinos in the next few years.
Pagcor president and CEO Alejandro Tengco estimated that gross gaming revenue of the local gaming industry would reach between P450 billion and P480 billion this year, up from P410.5 billion in 2024.
