Thursday, October 28, 2010

Asia-Pacific gaming operators on winning streak, says S&P report

KUALA LUMPUR:?? Gaming operators in Asia-Pacific are expected to continue strong growth, underpinned by the steadily growing Chinese economy, resilient regional markets with an expanding middle class, says Standard & Poor's Ratings Services.

Another factor supporting the performance of operators in the region would be the an improving global economy, the ratings agency said in an industry report on Thursday, Oct 28.

The report, entitled "Robust growth and resilient markets pave the way for casino operators' sturdy performance in Asia-Pacific???, said gaming operators in Asia-Pacific have strongly benefited from robust economic growth and the resilience of markets in the region.

S&P credit analyst Allan Redimerio said this was in sharp contrast to operators in other major regions, such as North America, that continue to face pressures stemming from weak economic activity in those regions.

"We expect the performance of casino operators in the region to remain stable for the next 12 months," he said.

The report card said the gaming market in Macau has maintained its strong growth momentum since the second half of 2009, with gross gaming revenue growth in 2010 likely to exceed Standard & Poor's expectation of 15%.

Singapore's foray into the gaming industry has increased the size of the market, and the performance of the country's two new integrated resorts has been encouraging--so far.

Moreover, new competition from Singapore has not affected Malaysia's Resorts World Genting, where the number of visitors in the first half of 2010 was higher than in the same period last year.

In addition, the U.S. gaming companies that have a significant presence in Macau and Singapore continue to benefit from the robust growth trend in these markets.

The performance of casino operators in Australia and New Zealand also remained steady despite the diminished effect of the fiscal stimulus program in Australia, and the challenging economic environment in New Zealand.

S&P said stronger economic prospects, reasonably limited competition, and relatively lower financial leverage would support the performance of casino operators in Asia-Pacific.

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