Melco to expand portfolio in Sri Lanka, gains recovery in Q1

Melco Resorts & Entertainment Limited is working with John Keells Group in Sri Lanka to develop a groundbreaking integrated resort in central Colombo, with an investment exceeding USD1 billion.

Formerly known as the “Cinnamon Life Integrated Resort,” the integrated resort will be rebranded as City of Dreams Sri Lanka and will be the first of its kind in Sri Lanka and South Asia.

The gaming operator’s local subsidiary has obtained a 20-year gambling license from the Sri Lankan government, and is set to supervise the casino activities at City of Dreams Sri Lanka and take charge of the uppermost five levels of the hotel, operating under its Nuwa label, providing ultra-luxurious accommodations.

The rebranded property will offer 800 hotel rooms, as well as retail outlets, food and beverage options, MICE facilities, and more.

“We will be responsible for the fit-out and operations of the casino, which we expect to open in mid-2025, while the City of Dreams Sri Lanka Integrated Resort itself is expected to open in the third quarter of 2024,” Lawrence Ho, Chairman & CEO of Melco Resorts, said in an earnings call with analysts.

Meanwhile, Ben Lee, managing partner at IgamiX, said that the reliance on the Indian feeder market will be an “interesting challenge as no major jurisdictions have been able to successfully develop that market.”

“There is however some anecdotal data to suggest that there is some chinese business to be had on the ground, presumably from the BRI participants involved in local projects,” he told the Times.

Moreover, Melco has hired Tim Kelly as the property president of City of Dreams Macau.

Kelly, a former executive at Wynn Palace and Atlantis Dubai, has a strong background in the integrated resort industry, having started his career at MGM Grand in Las Vegas.

Revenues at USD1 billion

Melco Macau’s first quarter property EBITDA reached 89% of 2019 levels as operating revenues for the quarter reached USD1.11 billion, a 55% increase compared to the same period in 2023.

The operating income for the first quarter of 2024 was USD125.4 million, a significant improvement compared to MOP0.4 million in the first quarter of 2023.

Melco generated Adjusted Property EBITDA of MOP298.8 million in the first quarter of 2024, compared to MOP190.8 million in the same period last year.

In the sam earnings call with analysts, Ho said that in March, both City of Dreams Macau and Studio City “recorded the highest [number of] mass table games dropped ever.”

“In April, we continued to gain market share, recording the highest daily gaming revenue since Macau’s reopening in January 2023,” he added.

Meanwhile, the executive has hailed initiatives recently announced by the Chinese government, such as the multi-entry group tour visas between Macau and Hengqin, the new cities added to the Individual Visit Scheme (IVS) in March.

“An easier online visa application process for residents of China’s 20 largest cities, along with the proposed connection of Shenzhen to the Macau Zhuhai bridge, increases accessibility to Macau and enlarges our customer base,” he said.