Echo Entertainment (EGP)

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One of the 2 big listed casino gaming companies. The other being Crown Entertainment.

Genting HK's application to raise stake in EGP above 10% remains pending...

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Echo upbeat about Brisbane bid
OCTOBER 31, 2014 11:45AM

Mitchell Neems

Business Spectator Reporter
Melbourne
Echo Entertainment has told shareholders it has three key strategic priorities for the year ahead, as the gaming group looks to zero in on its historical ties with Queensland.

Chief executive Matt Bekier said, at the company's annual general meeting, the group would improve operating performance across Echo's businesses; deliver on the Jupiters Gold Coast expansion; and "put its best foot forward" in bidding for a new development at Brisbane.

Echo, the owner of the Sydney Star Casino, Jupiters Gold Coast, and Treasury Brisbane, formed a consortium with Chow Tai Fook Enterprises and Far East Consortium (FEC Australia) to prepare a joint proposal to develop an entertainment precinct and integrated resort at the Queen’s Wharf Brisbane site earlier this year.

James Packer's Crown Resorts and Echo earlier this week submitted their proposals to develop a casino on prime real estate in Brisbane's Queen's Wharf precinct.

"In terms of the Brisbane bid, we can’t yet disclose the details of what we are proposing to build, or the scale of the tourism, economic or job-creation benefits to Queensland," Mr Bekier said.

"But let me assure you that we have put forward a responsible offer that delivers a truly iconic precinct."

Yesterday, Echo tipped an increase in first-half earnings growth of up to 31 per cent -- with its international VIP arm proving to be a goldmine -- but it did warn of potential volatility.

Mr Bekier said while the results point to success in creating a very successful international VIP business in Australia, partnering with Chow Tai Fook and Far East Consortium "adds massive genuine Asian hospitality capability to our bid".

"As a business with its historical roots very much in Queensland, perhaps the most gratifying aspect of developing our proposal with CTF and FEC has been the unique opportunity that this provides for Echo to make truly significant and enduring contributions to the future appeal and prosperity of Brisbane, as well as the Gold Coast, for locals and tourists alike," he said.

Mr Bekier said the Queen's Wharf project would be a major string to Echo's bow.

"Our long term leases on the Treasury and Lands Administration buildings mean that we have ongoing control over a very significant piece of the greater Queen's Wharf footprint," he said.

"This means that we can move the current casino into a new, fit-for-purpose location, and repurpose those important heritage buildings so that they can play a much more effective role in opening up and connecting Queen's Wharf into the rest of South Bank and Brisbane."

However, he reassured shareholders about Echo's competitiveness even if it were to lose to Crown.

"The control of this site and the proximity to Jupiters Gold Coast also means we have a credible long-term presence in Brisbane should the competing bid be selected," he said.

The Queensland government is expected to announce a decision on Queen's Wharf early next year.

Crown earlier this year trumped Echo for a second casino in Sydney.

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Growth in Chinese tourist arrivals halved
THE AUSTRALIAN NOVEMBER 07, 2014 12:00AM

Lisa Allen

Property & Tourism Reporter
Sydney
Outgoing CEO of the Australian Rugby Union, John O'Neill at Australian Rugby Union Headquarters in St Leonards in Sydney.

Echo chairman John O’Neill says the drop in Chinese arrivals is a matter of concern. Picture: Stuart McEvoy Source: News Corp Australia
ECHO Entertainment chairman John O’Neill says he will push ahead with a $345m upgrade of ­Jupiters Hotel and Casino on the Gold Coast, as well as his $1 billion bid to build a new casino and ­entertainment complex in Brisbane, despite signs of a slowing in Chinese tourism.

The pace of growth in mainland Chinese tourist arrivals almost halved over the past year, amid signs of a cooling Chinese economy.

“It is concerning the (Chinese tourist) growth is dropping,” said Mr O’Neill, commenting on the inbound data released by the ­Bureau of Statistics yesterday.

“Mainland Chinese arrivals are becoming far more important. That is why we are investing so heavily in tourism infrastructure, not so it sits there as a white elephant.”

The Bureau of Statistics figures show Chinese tourist arrivals increased 10.5 per cent in the year to September, almost half the 19.3 per cent rate in the previous year.

The Qantas, Accor and Carnival Australia-backed Tourism & Transport Forum said as Australia was missing out on Chinese visitors, the US was sustaining growth of 23 per cent while Chinese arrivals were up 30 per cent in Canada this year.

Malaysia, India, Singapore and the Philippines were also achieving higher growth in mainland Chinese arrivals than Australia.

Figures released from Macau — which ranks as the world’s biggest casino market — shows gaming revenue was down more than 23 per cent last month amid a slowing of visitors from mainland China. TTF chief executive Margy Osmond blamed Australia’s outdated visa process for the drop in Chinese arrivals, saying it takes up to three weeks for travellers to get approvals to enter Australia.

“If you look at the growth in the US and Canada they have been working very hard to make their visitor experience and visa system more attractive, and that is why the US is seeing growth. We are losing our competitive advantage, if we haven’t already lost it.

“We spend a lot of time and money doing terrific marketing, we get them interested and then we make it difficult for them. The government is conscious of this, work is being done, but it is not happening quickly enough.”

For Echo Entertainment, Chinese arrivals were becoming far more important to its business, as were arrivals from Japan and Indonesia, and while Mr O’Neill acknowledged the 12-month dip in arrivals he said the five-year average might paint a clearer picture.

Despite the falls, Mr O’Neill said his $860m investment in The Star casino in Sydney’s Pyrmont was paying dividends three years after its completion, and his VIP business driven by Asian visitors was growing exponentially.

“We are in a tender in Brisbane to hopefully win the rights to develop the Queen Street Wharf precinct into the best integrated resort in Australia.”

Mr O’Neill said the issue of slowing Chinese inbound arrivals was a matter for the aviation industry’s policy and pricing as well as the development of tourism infrastructure.

Tourism Australia said the number of visitors from China has doubled since 2009 from 350,000 to 789,300 for the year ending September 2014.

“While growth may have moderated slightly it is from a significantly larger base,” said Tourism Australia general manager Karen Halbert.

“Importantly September 2013 saw a significant increase in visitors from China prior to the introduction of the China Tourism Law in October 2013,” Ms Halbert said. “We expect some inconsistency in growth rates from China as the impact of the law is reflected over the next few months.”