One of Vietnam's Largest Casinos Losing Millions of Dollars
LISTEN TO THIS ARTICLE:Despite a rebound in international tourism to the country, Vietnam isn't yet finding a lot of traffic for its casinos. In particular, the Royal Casino, one of the largest in the country, hasn't been able to report positive results in over four years.
Royal International Continues Run of Bad Luck
Royal International Corp. encountered a rather challenging second quarter. The company behind the Royal Casino in the province of Quang Ninh, located in northern Vietnam two hours to the west of Hanoi, recorded losses of VND24 billion ($1 million).
This marks the company's 15th consecutive quarter of losses, surpassing its losses from the previous year by almost 48 times. Furthermore, Royal International saw a significant decline in revenue, witnessing a 42% year-on-year drop that amounted to VND24 billion (US$1.01 million).
Royal International is a prominent resort located in the scenic Bai Chay area, situated in the city of Ha Long, Quang Ninh. Offering a diverse range of amenities, including a casino, hotel and luxurious villas, it caters to a specific class of tourists. However, during the previous quarter, the casino division incurred a loss of VND9 billion (US$379,800), while the hotel and apartment divisions registered a combined loss of VND14.5 billion (US$611,900).
The company experienced a loss of VND35 billion (US$1.47 million) in the first half, falling far short of its annual profit target of $1.5 million. Moreover, in 2022, it faced yet another financial setback, with a loss of VND61 billion (US$2.6 million), marking the fourth consecutive year of losses.
Regardless of the rise in earnings, Royal International experienced a decline in revenue from VND125 billion in 2020 to VND119 billion in 2022 (US$5.27 million to $5.02 million), which is a 60% annual decrease.
Royal International, a registered establishment since 1994, has been in the red almost every year since then. Only in 2015 and 2018 did it report revenue gains. As a consequence of these difficulties, its shares were removed from the Ho Chi Minh Stock Exchange in May of 2022.
Vietnam is currently weighing options for the expansion of its casino industry, deliberating on the best course of action. Presently, the only casino available to Vietnamese is Corona Resort and Casino, situated on the island of Phu Quoc in the southern region of the country. However, access to the casino floor is granted exclusively to those who can demonstrate their financial ability to comply with the regulations set by the government.
Vietnamese Tourism Rebounds
An increase in international tourism isn't helping the casino. Vietnam's tourism industry is making remarkable strides towards recovery, as revealed by the tourism authorities, who disclosed a milestone of 1.04 million tourist arrivals in the month of July.
This figure surpasses all previous records since the outbreak of COVID-19. July's statistics are three times greater than that of the corresponding period from last year and account for nearly 80% of the influx of international tourists from July 2019.
Vietnam hosted 6.6 million international visitors during the first seven months of 2023, which accounts for 83% of its annual goal. The arrival surge in July was primarily fueled by a substantial influx of tourists from Europe and a notable boost in crucial Asian markets, as highlighted by the tourism agency.
Total revenue generated from tourism during the initial seven months of the year reached VND416.6 trillion ($17.6 billion). This accounted for an overwhelming 64% of Vietnam's ambitious annual target.
Among the leading tourist hotspots worldwide, Asia still holds its preeminent status, attracting a myriad of visitors. The top 10 coveted destinations within Asia are Korea, China, Taiwan, Japan, Thailand, Malaysia and Cambodia, alongside Australia and India.
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