Australian casino operator The Star Entertainment Group (SGR) plans to slash its workforce in order to keep the lights on until its international VIP and domestic gamblers boost their spending.

On Monday, SGR released a trading update covering the year through June 8, during which domestic revenue managed to rise only 0.3% from the same period last year. The international VIP business fared much worse, with turnover falling 31% year-on-year.

The VIP turnover decline is actually slightly better than the 33% decline reported in the first half of the fiscal year, but win rate came in below the 1.35% theoretical average. Worse, domestic revenue had risen 6.4% in H1 and SGR tried to point out that overall fiscal 2019 domestic revenue is up 3.1% but investors weren’t exactly reassured.

As a result, SGR downgraded its FY19 earnings forecast to a range of AU$550-560m, compared with AU$568m in the 12 months ending June 30, 2018. The news sent SGR’s stock into a tailspin, falling 16% on Tuesday to a four-year low, erasing over $600m in market valuation in the process.

Dennis Uy, the Davao-based Philippine tycoon and owner of PH Resorts, has been looking to make a splash with their upcoming casinos in Mactan, Cebu, and Clark City, Pampanga. That effort looks like it might get significantly easier with the recent Executive Order (EO) signed by President Rodrigo Duterte, declaring the Clark Industrial Estate 5 (IE5) as an international center of commerce, industry, leisure and recreation.

[Image credit: Wikimedia Commons]

Philippine outlet Business World reports Duterte signed the order on June 4, and copies of it were delivered to reporters on June 10. The IE5, which had previously been designated as a logistics center, has now been reclassified to suit a broader purpose. The EO explained the change was necessary because:

“[IE5] attracted international attention and interest as the Asia-Pacific Region’s emerging premiere hub for aviation and international logistics, as well as an international center for commerce, industry, leisure and recreation.”

There are still some great value stocks out there in the gaming sector. Despite all the instability within core gaming markets including the UK, Macau and the Las Vegas, safe places to park money long term and wait without much worry still exist. If you have a time horizon of 5-10 years or longer and want to build some wealth without trading in and out and sweating over daily price movements and political shakeups, here’s your checklist:

1) Stock at or near lows. You can’t buy low, after all, without actually buying low. Shares should be at lows for external reasons, having nothing to do with the company itself. Gambling companies are hit all the time with regulatory surprises, new taxes, punitive measures involving problem gamblers and protection schemes, problems obtaining licenses for one reason or other, etc. As long as the ruling reason for a decline in the stock is external to the company, it’s a buying opportunity

2) High dividends with little to no danger of suspension. They can wobble from quarter to quarter, but basically they’re there to stay. If the company is still making good money despite regulatory issues, even if it’s making less money than before, chances are good that it will eventually recover.

3) Iron balance sheet. Debt-fueled growth is only a good strategy if it’s short term in order to take advantage of opportunities that come around only rarely. In today’s super-cheap-money world, we see way too many companies that incorporate debt into their business models intrinsically and just keep rolling it over. It can keep their shares high for a long time but not forever. If you’re a trader, these sorts of momentum plays are nice to play around with. If you’re looking for a place to park capital and forget about it, move on with your life and check back when you’re retired, then not so much.

Quezon City appears to be relishing the legal battle it has before it, openly defying the Philippines Amusement and Gaming Corporation (PAGCOR). On the Public Affairs and Information website of the city, it was announced on June 10 that the Quezon City Council had passed a Gambling Regulatory Ordinance, with the intention “to protect the mental health of the people against gambling addiction and maintain peace and order.”

The ordinance, proposed by Xenia Lagman, Franz Pumaren, Alexis Herrera, Raquel Malañgen, Marvin Rillo, and Godofredo Liban II, does several admirable things. It establishes a 24-hour hotline for those with gambling problems, an advisory council, and pushes for the adoption of regulatory policies.

Where it gets sticky is the new gambling fees they propose for residents of Quezon City. The announcement states:

“To further strengthen the campaign for the prevention of gambling problems, the QC Gambling Regulatory Ordinance requires the residents who wants to play in gambling establishments within the city to pay P1,500 for casinos, P500 for e-games, P100 for e-bingos for every consecutive period of 24 hours, and P30,000 fee if the gambling establishment offers an annual membership.”

Macau casinos better be ready to face a few months of rough weather. The Gaming Inspection and Coordination Bureau (also known as the DICJ) announced on June 10 that it had met with the operators to discuss their plans in case a bad typhoon hits, GGRAsia reports.

Based on the Macao Meteorological and Geophysical Bureau forecast, up to six typhoons are expected to come within striking distance of Macau in 2019, with the first typhoon expected to come as soon as the next weather forecast, and extending until early October.

To prepare for that, the DICJ reminded operators to keep their emergency plans up to date, particularly if they are in the coastal, low-lying areas, where floods and high winds are most likely to do the most damage.

This is a fairly low information, routine kind of reminder by the DICJ, but it’s a necessary one. If operations don’t stay on their toes, the amount of physical and economic damage a typhoon could cause would be truly regrettable.

Italy’s regulated online gambling market posted strong double-digit gains across nearly every vertical except (what else?) poker in the month of May.

Figures released by Italy’s Agenzia della Dogane e dei Monopoli (ADM) regulatory body show overall sports betting revenue hit €134.1m in May, up 44.2% from the same month last year, pushing the year-to-date total up 11.7% to €698.5m. Goldbet retained the overall betting market share crown with 15.3%, just ahead of runner-up Snaitech at 14.9%.

While the overall revenue figure was significantly less than April’s €173.6m, growth was strong in both retail and online betting segments, although land-based wagering growth outpaced online for a change. Retail betting revenue grew 49.5% to €77.9m, while online improved 37.7% to €56.2m.

Goldbet also claimed the retail betting crown with a 20.2% share, followed by Snaitech (16.9%) and GVC Holdings’ Eurobet brand (14.6%). Bet365 led the online chart with a 13.56% share, narrowly ahead of its Italian archrival SKS365/Planetwin365 (13.35%) while Snai wasn’t far off the mark at 12.1%.

The US land-based commercial casino sector hit yet another all-time revenue record in 2018, with only two of 24 gaming states not reporting year-on-year growth.

On Tuesday, the American Gaming Association (AGA) released its annual State of the States report, which tracks the performance of the 465 commercial casinos across the US of A. The AGA says total casino gaming revenue hit $41.68b in 2018, a 3.5% improvement over the 2017 report and the fourth straight year of year-on-year growth.

Of the 24 states that had commercial casino operations in 2018, 12 reported record annual revenue in 2018. Only two states – Illinois (-2.4%) and West Virginia (-0.1%) – reported year-on-year declines. State governments’ share of 2018’s record haul was equally record-breaking, rising 31% year-on-year to $9.71b.

Only 18 states separately report slots and table game revenue, but those states broke with tradition by reporting higher year-on-year growth in slots over tables, flipping a script that has held for some time. Slots revenue was up 3.4% in 2018, while tables grew 2.4%.

If citizens of China and Vietnam needed any reminder, online gambling is still illegal in those countries. That reminder came on June 10, when Police in Anhui province swooped in and arrested 78 suspects for running an online gambling ring, reports XinhuaNet.

The investigation into the group began in October, when police were notified that a “victim” had lost 300,000 yuan ($43,000) in an online game called “Zork.” There is nothing in the report if that version of Zork has anything to do with the classic 1980’s text based adventure game.

The games allegedly stretched into the neighboring provinces of Jiangsu and Hubei, and amounted to an operation worth 128 million yuan ($18.5 million). They brought in new gamblers by using live streaming platforms to entice more to play.

Of the 78 arrested, 46 are still in detention while investigation continues.

If citizens of China and Vietnam needed any reminder, online gambling is still illegal in those countries. That reminder came on June 10, when Police in Anhui province swooped in and arrested 78 suspects for running an online gambling ring, reports XinhuaNet.

The investigation into the group began in October, when police were notified that a “victim” had lost 300,000 yuan ($43,000) in an online game called “Zork.” There is nothing in the report if that version of Zork has anything to do with the classic 1980’s text based adventure game.

The games allegedly stretched into the neighboring provinces of Jiangsu and Hubei, and amounted to an operation worth 128 million yuan ($18.5 million). They brought in new gamblers by using live streaming platforms to entice more to play.

Of the 78 arrested, 46 are still in detention while investigation continues.