Gaming | Imperial Pacific falls after denying reports casino in probe

Imperial Pacific International Holdings Ltd., the operator of a casino in the U.S. territory of Saipan, tumbled to an 18-month low as it resumed trading in Hong Kong after the company denied reports that its Best Sunshine gaming operation is being investigated by a U.S. regulator in charge of anti-money laundering efforts.

Bloomberg News reported Nov. 14 that the U.S. Treasury’s Financial Crimes Enforcement Network has taken notice of activities at Best Sunshine. Imperial Pacific never received any investigation notice from the U.S. Treasury unit, it said in a stock exchange statement this week that was in response to “certain media articles,” after requesting a trading halt earlier that day. Fincen, as the unit is known, is responsible for alerting prosecutors and other authorities of suspicious financial flows.

Imperial Pacific has implemented stringent internal control measures and has fully applied an anti-money laundering system to ensure compliance with all applicable U.S. laws and regulations, according to the exchange filing.

The stock fell 7 percent by the close of trading Wednesday to the lowest level since April 29, 2015, giving the company a market value of HKD16.9 billion (USD2.2 billion). It slumped as much as 11 percent earlier.

Imperial Pacific reported daily revenue of about $170,000 for each of its 16 VIP tables in the first half of the year – almost eight times the average of Macau’s largest casinos. In September, Imperial Pacific posted a record $3.9 billion in total bets at its casino – meaning the 100 or so high-rollers who it says come through its doors monthly each wagered an average of $39 million.

Imperial Pacific says its casino, overall, is attracting visitors at full capacity.

“As there are only 38 gaming tables in the casino and each table is able to serve 5 to 6 customers at the same time, our service capacity has saturated,” Imperial Pacific said in its statement. “Each night, around 100 customers could not be arranged with a seat and had to queue or stand to participate.”

Chief Executive Officer Mark Brown said in an interview this month that he believes that comparisons with Macau casinos reflect that Imperial Pacific’s peers are under-reporting figures, with off-books betting not showing up in official reports. Many gaming tables at Macau resorts are underused, which accounts for the high revenue from the limited tables in Saipan, according to Imperial Pacific. Bloomberg

Gaming stocks on a high note

Macau gaming counters rose across the board in afternoon trade yesterday at the HK stock exchange.

Galaxy Entertainment and Sands China surged 4.3 percent and 5.2 percent to HKD34.95 and HKD36.35, respectively. Melco Crown International rose 2.6 percent to HKD11.08. S&P Global Ratings this week forecast Macau’s gaming revenue will be flat to 10 percent higher in 2017.

Also this week, Chief Executive Chui Sai On a made a more conservative yet positive prediction for gambling revenue in 2017: flat or a little better than this year.