Solaire expenses drag Bloombery into P688-M loss

MANILA, Philippines - Bloomberry Resorts Corp. of port magnate Enrique Razon Jr. sank into losses in 2012 due to higher expenses prior to the opening of its megacasino along Manila Bay.

In a regulatory filing, Bloomberry said it incurred a net loss of P687.9 million last year, reversing the P2.7-million income the previous year.

“The turnaround was due to increased level of pre-operating activities mainly from recruitment and training, direct and general marketing as well as higher number of employees by the end of 2012,” Bloomberry said.

The listed casino and resort complex operator nevertheless booked a one-time gain of P72.3 million from the sale of Monte Oro Resources & Energy Inc. to associate Prime Metroline Holdings Inc.

Revenues, which came from interest income and gain on sale of investment in an associate, rose to P195.6 million from P145.68 million.

Bloomberry said expenses surged to P951.97 million last year from P159.52 million in 2011 as it prepared for the opening of the first phase of the $1.2-billion Solaire Resort and Casino.

“Pre-opening expenses increased 586 percent to P318.8 million due to recruitment and training expenses of new employees, payment for direct advertising and marketing expenses, salaries and benefits of employees directly associated with the opening, Global Gaming Philippines LLC fees and other pre-opening consultants, and rentals of temporary offices,” Bloomberry said.

Entertainment City, the Philippines’ answer to the Las Vegas, Singapore and Macau gaming hubs, kicked off with the opening of the Solaire Resort and Casino last Saturday.

The $750-million Phase 1 of Solaire has 500 rooms, 18,500 square meters of gaming space and 15 luxurious dining options.

Solaire earlier secured a provision to borrow as much as P14.3 billion to allow the company to open a 300-all-suite hotel, 3,900 parking slots, a shopping center with luxury brand stores and an entertainment theater by next year.

The casino hotel is situated in Entertainment City, a 120-hectare property reclaimed from Manila Bay and owned by the Philippine Amusement and Gaming Corp. (Pagcor).

Pagcor forecasts that gambling revenues in the Philippines will grow from $1.3 billion in 2011 to at least $10 billion by 2017, boosted by the operations of the four gaming complexes in Entertainment City. – Neil Jerome Morales, Rainier Allan Ronda