Thu, Sep 3, 10:49am by Charlotte Lee
Another casino operator is reporting big losses in the first half of 2020.
Calvin Ayre reports Saipan casino operator Imperial Pacific International posted losses of $103 million in the first half of 2020, while questioning the definition of “exclusivity” in order to get out of paying its licence fees.
On Monday, IPI released its interim results for the first six months, ending June 30, during which revenue fell 93.3 per cent year-on-year to just US$3.4 million.
The company booked an operating loss of nearly double that, while its actual losses hit US$103 million.
Believe it or not, the figures are a significant improvement on the near US$240 million the company lost in the first half of 2019, and the improvement came despite IPI being forced to close its Imperial Palace casino in mid-March due to COVID-19.
IPI’s ill-fated decision to avoid junket operators and deal directly with its VIPs continues to weigh down its results, as the company has proven woefully incapable of collecting on the credit markets it issues to its high rollers.
There were far fewer VIPs this year, and the total outstanding debts that are less than six months old stood at a mere US$1.9 million, just a quarter of where they still this time last year
The contingent liabilities section of IPI’s report lists the numerous regulatory probes and lawsuits the company is currently facing.
Incredibly, IPI says it still hasn’t submitted documents requested by the US Treasury Department’s Financial Crimes Enforcement Network, which is conducting a probe into “apparent violations of the Bank Secrecy Act.”
The Commonwealth of the Northern Mariana Islands and its sole licensed casino operator, Imperial Pacific International have accused one another of breaching their Casino License Agreement.#Asia #Casinohttps://t.co/8WKJ8O6uC2
— iGamingSummit (@iGamingSummit) September 1, 2020
A trouble casino investor is forecasting losses for the six months to June 30 to fall by more than 50 per cent.
Asgam reported in August that Imperial Pacific International Holdings said the closure of casino operations due to COVID-19 in March has triggered to year-on-year decline.
Issuing a profit warning on Tuesday, IPI revealed that consolidated loss by the company and its subsidiaries looks likely to decline by no less than 50 per cent compared with the same period in 2019.
The loss of US$243 million was attributable to the owners of the company, the report said.
IPI said the expected decrease in unaudited consolidated loss is mainly attributable to the reduction in impairment losses recognised for trade receivables.
Last year, the company reported gross trade receivables of US$1.18 billion through June 30 2019, of which US$140.6 million was from one customer and US$320 million from its 10 largest customers.
Nevertheless, the expected reduction in loss won’t provide much comfort to IPI, which recently requested an abatement of its annual US$15.5 million casino licence fee, supposedly due to pressure brough about by COVID-19.
The US Federal Court also recently ordered IPI to pay US$5.6 million to its former contractor, Pacific Rim Land Development, for services rendered.
A casino hotel party has drawn the ire of the Massachusetts Gaming Commission.
Enterprise News reported this week that the commission met last Thursday to address blatant violations of its coronavirus pandemic regulations, calling for increased accountability after more than 100 people were partying in a hotel suite at Encore Casino Boston Harbour.
All bets are off when it comes to gambling with public health at the state’s casinos, with the need to comply with state regulations “critically important”, according to commission chairperson Cathy Judd-Stein.
The commission addressed protocol changes at Encore in light of a party that lasted until 3am on August 16, when more than 110 people were finally cleared from a suite by security and state police, three hours after the gathering was first reported to staff by a tipster, who saw pictures of the event on Instagram.
Face masks were missing and social distancing guidelines flouted, interim director of the state commission and director of its investigations and enforcement bureau Karen Wells said.
“The majority of them were not wearing masks,” Wells said.
The gaming commission issued an order of noncompliance to Boston Harbour after a swift investigation in concert with state police, requiring the casino property to implement measures to make sure its guests comply with the state’s coronavirus public health orders.
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