Alliance Global Group, the investment company led by Philippine billionaire Andrew Tan, has announced its plans to extend its casino resort operations beyond Manila.
During the company’s annual meeting, CEO Kevin Andrew Tan stated that they are actively exploring potential expansion sites in key tourism hubs across the Philippines.
The firm is betting on the recovery of the tourism sector and the potential advantages stemming from China’s crackdown on Macau, which has created uncertainty in the region’s gambling hub.
Additionally, the Philippine gaming industry is undergoing a broader transformation, with the government considering the sale of state-owned casinos.
Travellers International Hotel, the gaming venture of Alliance Global, returned to profitability in 2022, reporting a net income of 1.1 billion pesos ($19.6 million).
The company experienced record-high gross gaming revenue and continued recovery in non-gaming earnings.
As part of its ongoing expansion efforts, Alliance Global has allocated around 4 billion pesos from this year’s planned capital expenditure of 70 billion pesos to expand the Newport World Resorts casino complex operated by Travellers. Alliance Global recently acquired its casino-venture partner, Genting Group.
To sustain its growth trajectory, Travellers aims to increase the contribution of premium mass-market gamblers to half of its gross gaming revenue. The company also plans to expand its VIP junket operations, which generated revenue surpassing pre-pandemic levels in 2022.
Despite this positive development, shares of Alliance Global fell 1.5% in Manila trading, marking the sixth consecutive daily loss, the longest streak of declines since September.
During the annual meeting, other important updates were discussed. Megaworld, the group’s property arm and primary contributor to net income, is actively managing its foreign exchange exposure to mitigate the impact of currency volatility.
The company remains resilient to higher interest rates, as only a small portion of its borrowings are subject to floating interest rates.
While approximately 30% of Megaworld’s business-process management and outsourcing office tenants operate under work-from-home arrangements, there has been a growing demand for office space from the information technology and BPO sectors. Megaworld’s office occupancy rate currently stands at 90%.
Emperador, the distillery venture of Alliance Global, plans to allocate 6 billion pesos of its 7 billion peso capital expenditure this year to expand its whiskey facility and infrastructure in Scotland. The company also intends to pursue other growth opportunities.
Alliance Global’s restaurant venture, which holds the Philippine franchise of McDonald’s, is set to resume aggressive expansion this year, focusing on faster-growing areas outside of Metro Manila.
Original article: https://www.yogonet.com/international/news/2023/06/20/67588-alliance-global-group-expands-casino-resorts-beyond-manila-eyeing-growth-in-philippine-tourism-hubs
