COVID-19 Shutdown: Is City Of Dreams Manila Going to Survive the Pandemic?
The Belle Corp., the multinational casino and entertainment giant, based in the Philippines, has reportedly informed the public that its City of Dreams Manila facility received a second-quarter loss of nearly $50 million because of the Covid-19 pandemic. The Philippines, like pretty much everywhere else in the world, was forced to shut down its tourism and gambling operations due to the virus. As you know, the Philippines accounts for a large part of its revenue thanks to the gambling industry. Besides, any company would be hurt by losing its primary income source, so let’s see how Belle Corp. is coping.
They Were Off To A Great Start
Back in 2018, the company posted a report with a year-to-year revenue increase, so things were going well for them. According to documents filed with the Philippine Stock Exchange, that year the company saw an increment of $69 million (PHP 3.6 billion), but that was the height of the gains. This fascinating outcome was achieved as a direct result of gambling earnings from the City of Dreams Manila casino.
However, they didn’t manage to continue this trend when their consolidated net income fell 11% in 2019. What is more, 2020 has hit businesses across the Philippines pretty hard. Naturally, the first companies to suffer were entertainment, tourism, and gaming enterprises.
This extensive lockdown first started in mid-March and suspended all gaming and casino operations in the region, including the large-scale resorts in Entertainment City. The pandemic measures were subsequently extended in increments, and at the beginning of August, Manila returned to a stricter anti-Covid-19 lockdown, known as “modified enhanced community quarantine.” Affected by the casino shutdown, Belle Corp. reported a 96% income decrease for the first 9 months of the year.
The Pandemic-Related Losses
Belle Corp. had made only $1.92 million from January to September compared to $52.8 million the company earned in 2019. Hence, the company saw a revenue of only $60.06 million while at the same time last year, they had already received $119.09 million.
Belle Corp. suffered a net loss of $2.66 million from July to September after having gains of $10.64 million during the same period in 2019. That quarter’s revenue had fallen 42%, hence dropping from $32.43 million to $18.69 million a year.
Since the City of Dreams Manila was their main moneymaker, its shutdown directly contributes to the majority of the losses.
CoDM has only received $6.717 million during the period compared to $49.19 million at the same time last year. According to these numbers, the company has lost 86% of its revenue from the CoDM over the first nine months of 2020.
What About Belle Corp.’s Other Businesses?
What is more, it has been reported that the 3 hotels inside the City of Dreams Manila experienced deterioration by 92.6% year-on-year to a mere $1.21 million. To make matters worse, Belle Corp. also took a loss with Pacific Online Systems Corp., in addition to revenue damage done to the City of Dreams Manila. The Pacific Online, owned partially by Belle Corp., is a subsidiary in control of online gambling equipment supplied for the Philippine Charity Sweepstakes Office. They lease this equipment from Belle Corp. and also suffered from a revenue fall of 71% (down to $4.5 million during the period).
There Is Still Hope for Belle Corp.
Belle Corp. is also into real estate, including land and buildings that Melco Resorts and Entertainment leases at CoDM for its gambling operations there. This was the only stable item on the books Belle Corp. has received since the pandemic start is with its real estate; this includes land and buildings leased by Melco Resorts and Entertainment. Hence, Belle Corp. received $41.32 million from Melco, which is exactly the same amount it collected last year.