Friday, August 19, 2016

NagaCorp reports second quarter earnings

NagaCorp website:

Net profit increased by 24% to US$125.2 million

VIP rollings increased by 26% to US$4.5 billion

Mass Market table buy-ins increased by 17% to US$305.6 million

Mass Market EGMs bills-in increased by 18% to US$741.8 million

Basic earnings per Share of US cents 5.51


An interim dividend for Shareholders and a distribution for the holder of the Convertible Bonds of US cents 2.77 per Share/Conversion Share (or equivalent to HK cents 21.47 per Share/Conversion Share) has been declared, representing a payout ratio of 60% based on the net profit generated for the Period. The interim dividend and distribution shall be paid on Tuesday, 13 September 2016

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The Cambodian economy continued to register stable growth. The International Monetary Fund is projecting Cambodia’s real Gross Domestic Product to grow at 7% in both 2016 and 2017, with an inflation rate of 2.1% and 2.8%, respectively. Visitation to Cambodia continued to grow with international arrivals increasing by 2.4% to 2.0 million visitors in the first five months of 2016 compared to the same period in 2015. 

Visitor arrivals to Phnom Penh International Airport increased by 10% over the same period. The top three countries where visitors originated from were Vietnam (19%), China (16%) and Korea (8%), together accounting for 43% of total arrivals to Cambodia. In particular, visitors from China increased by 12% year-on-year to 325,206 visitors during the first five months of 2016 (Source: Ministry of Tourism, Cambodia). Visitor growth continues to be one of the growth drivers of the Group’s business.  

As you can see 16% of visitors to Cambodia are from China and amazingly 19% are from Vietnam. As these countries become wealthier and their middle class continues to develop they will be traveling more and more. This should benefit Cambodia's tourism industry and NagaWorld. The company continues to increase earnings and has a commitment to pay out around 60% of earnings as a dividend. I will continue to hold.

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