Home Singapore Singapore’s casino revenue drops, but the future’s still bright

Singapore’s casino revenue drops, but the future’s still bright

Fears of Singapore’s economy sliding into recession may have receded for now, but in its once-burgeoning casino sector, all is not well. Both of its major casinos have reported significant drops in revenue and profits, with many pundits now expressing concerns that the sector’s honeymoon period is over.

Dwindling revenue

resort-world-sentosa-casinoSingapore’s two mega-casinos, the Marina Bay Sands and the Resorts World Sentosa (which opened in February 2011 and January 2010 respectively) have seen revenue fall to the lowest levels seen in 18 months. As a result, many now claiming that the novelty factor of both has now worn off.

According to figures released by Genting Singapore, owners of the Resorts World Sentosa, the casino’s third-quarter revenue fell 20% to $528.4 million, resulting, while profit was down 47%. Worse still was reported by Sheldon Adelson’s Las Vegas Sands group, who revealed that revenue from its Marina Bay Sands location was just $470.8 million – a fall of around 28%, and the only Las Vegas Sands establishment to record a decline in the period.

Handsome incentives

To address these shortfalls, Both resorts have responded by offering handsome incentives to those who come and gamble at their casinos, such as free concert tickets. However, with heavy restrictions designed to deter ordinary Singaporeans from visiting the casinos, and concerns about the region’s economic growth blunting consumer spending elsewhere in Asia, these have had mixed results.

Green shoots of recovery

Of course, given how new both casinos are – the first of which opened less than three years ago – it was always inevitable that there’d be an initial surge in interest that was unlikely to last. And while the revenue might not be quite as high as before, revenue remains healthy.

Other areas of their business are showing signs of promise as well. During the same quarter, hotel bookings at the Marina Bay Sands rose 12%, which enjoyed an impressive 99.8% fill rate. While at the Resort World Sentosa, the fill rate was 93%. Additionally, Resort World’s Universal Studios theme park drew in more than 9,100 visitors, each of whom spent an average of $86.

So while it may well be the case that the novelty factor has indeed gone, Singapore is still outperforming Vegas, underlining its sector’s health.