Australian casino and hotels group, Echo Entertainment, has staged a remarkable comeback this year with profits reaching $219 million.
Much of this success can be owed to the revamped Star Casino in Sydney which has given the entertainment group the record drive in revenue, signalling a turnaround which saw net profits for the gaming operator of just $42 million three years ago.
Earlier this year, Echo beat rival James Packer’s Crown Resorts to win a $2 billion tender to transform Brisbane’s Queen’s Wharf precinct into a luxury hotel and resort.
But Echo, which currently counts Hong Kong billionaire David Chiu of Far East Consortium and luxury conglomerate Chow Tai Fook as partners, is banking on the expertise of its Chinese counterparts to deliver the much needed success for the opening of the Queen’s Wharf casino scheduled to open in 2022.
Chiu’s holy grail advice? China’s VIP customers.
“They are not easy customers, but they are great customers,” Chiu told Fairfax. “Why do I say they are great? They lose a lot of money. In pure numbers, they are good.”
The Australian entertainment group is expected to lure in more high-rolling gamblers from China as Australia continues to be a leading tourist destination for Chinese tourists coupled with a slowing in Macau’s gambling scene.
According to Chiu, China’s middle class will also be critical to the success of the high end mecca in Brisbane with expectations that the group will increase from 240 million to 600 million people by 2025.
“There will be more disposable income – and one thing we do know is that the Chinese love to gamble. That will not change.”
Fairfax reports high rollers brought in a record $46 billion to Echo’s tables in the 2015 financial year with revenue rising 18.5 per cent to $2.14 billion.
It is expected that a third of the gross VIP revenue from the casino will come from wealthy Asian gamblers.
“If you ask me who the richest people are in Hong Kong, Beijing or Shanghai, in theory we should know them and we obviously do,” said Chiu.
“High rollers drop $2 million, but they are very concerned about being over charged for a coffee. For the Chinese it’s just as important they get a shark fin soup in a Chinese restaurant as it is a private jet turning up in Shanghai.”
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