Bloomberry Income Drops 58% Due to Solaire North Costs

November 13, 2024 Philippines Casino & Hotel

Bloomberry Resorts’ nine-month net income dropped 57.83% to P3.5 billion due to costs from Solaire North and fewer casino patrons.

Bloomberry Resorts Corp., the listed operator of the renowned Solaire Resort & Casino, reported a significant decline in net income for the first nine months of 2024. Despite a modest increase in revenues, the company’s net income plummeted by nearly 58 percent, largely due to rising operational costs tied to its newest project and reduced patronage at its casinos.

In its November 13, 2024 stock exchange filing, Bloomberry disclosed a 57.83 percent drop in its net income, which fell to P3.5 billion from P8.3 billion in the same period last year. The company’s revenue, however, showed some resilience, rising by 6 percent to P38.5 billion for the first nine months of 2024, compared to the same period in 2023.

Impact of Solaire North and Increased Operational Costs

The steep decline in net income was primarily attributed to a combination of factors, including the opening costs of Bloomberry’s latest project, Solaire Resort North in Quezon City. The resort, which opened in May 2024, contributed to a P470-million net loss in the third quarter alone. In contrast, the company had recorded a net income of P1.9 billion during the same period in 2023.

A significant portion of the loss was due to higher depreciation and interest expenses incurred during the early stages of Solaire North’s operations. As a newly established property, the resort is still in the process of ramping up its operations, leading to higher upfront costs before it can generate sustained revenue streams.

Enrique Razon Jr., Bloomberry’s chair and CEO, acknowledged that the company faced challenges in its business environment. He noted that the gaming volumes at Solaire’s flagship location in Entertainment City had also decreased, reflecting a broader slowdown in patronage at the company’s casinos.

Growth in Gaming Revenues Amid Challenges

While the decline in net income was a major concern, Bloomberry did find a silver lining in its gaming operations. Despite the challenges in Entertainment City, the company saw a notable uptick in gross gaming revenues (GGR) during the third quarter of 2024.

This increase in gaming revenues was largely driven by the new contributions from Solaire North. Although the project is still in its early stages, Razon emphasized that the expansion of Bloomberry’s footprint in Quezon City has helped to offset the weaker performance at Entertainment City. As more patrons flocked to the new resort, Solaire North’s gaming operations showed promise, offering a much-needed boost to the company’s overall gaming income.

Razon stated that the contributions from Solaire North helped counterbalance the downturn, leading to a 22% increase in gross gaming revenues (GGR), which reached P16.3 billion from July to September.

For the first nine months of 2024, Bloomberry’s GGR totaled P45.5 billion, reflecting a 2 percent increase from the same period in 2023. While the overall gaming revenue growth was modest, the positive results from Solaire North provided some optimism for the company’s future prospects.

Solaire North’s Potential

Solaire Resort North, which opened its doors earlier this year, is seen as a key pillar in Bloomberry’s growth strategy. Located in Quezon City, the resort is expected to complement the existing Solaire Resort and Casino in Entertainment City, offering a more diversified gaming experience. With additional hotel rooms, gaming floors, dining options, and entertainment facilities, Solaire North is poised to capture a new segment of the market, particularly from tourists and locals who may find the location more accessible than the flagship property in Paranaque.

The launch of Solaire North was part of Bloomberry’s broader efforts to expand its operations and reduce its reliance on a single property. The company has been actively working to increase its market share by diversifying its offerings and enhancing the customer experience.

On November 12, 2024, Bloomberry signed a long-term agreement with European B2B iGaming technology provider Gaming Innovation Group Software Plc (GiG).

GiG will provide Bloomberry and the Solaire brand with access to a range of the technology solutions, enabling the group to significantly enhance its online gaming offering in the Philippines. As part of the Agreement, Bloomberry and Solaire will be able to utilise GiG’s iGaming platform CoreX, and AI tools LogicX and DataX.