Philippines-listed licensed online gaming operator DigiPlus Interactive Corp says new measures to tighten oversight of the industry will promote equitable competition among operators in the country.
Regulator the Philippine Amusement & Gaming Corp (Pagcor) has set out maximum percentages for cash rebates or cashback programmes that providers of electronic games can offer players.
Pagcor said that – based on a player’s turnover, i.e., gross bets placed, or the player’s deposit – there would be a permissible maximum rate of 1.50 percent cash rebate for digital slot machine games, electronic bingo games, numeric games, and sports betting, “except for casino table games and arcade-type games”.
The regulator also said that – measured on a player’s net losses – there could be “up to a maximum rate of 15 percent cashback for all types of electronic games”.
The fresh regulation will help “control the overly aggressive promotions by some operators,” said Celeste Jovenir, DigiPlus’ vice president of investor relations, during a Thursday event promoted by the Philippine Stock Exchange (PSE).
The PSE STAR event provides a platform for companies to discuss their strategies and financial updates with investors.
Ms Jovenir described the step as “positive” because it “levels the playing field” in the marketplace.
“As a listed company, we are very mindful of margins, so, we cannot be too aggressive in our promotions for user acquisition or retention,” she noted. “We always have to strike a balance, and this new regulation sort of balances it out for all the operators.”
Ms Jovenir also mentioned the introduction by Pagcor of a “minimum guaranteed fee” to be paid by all Philippines-accredited gaming system administrators. The new fee regime is scheduled to start from June 1, following a two-month deferral.
The measure, she remarked, “will likely impact more the brands that are still growing their businesses, as it represents an additional cost and challenge for a company that does not yet have an established presence” in the market.
In the Philippines, DigiPlus runs BingoPlus, described as the country’s first government-approved online bingo platform. It also operates ArenaPlus, a sportsbook, and GameZone, a platform for casual and arcade gaming. One of the group’s other units operates casino slot arcades in the country.
Recovering volumes
During Thursday’s event, DigiPlus’ president, Andy Tsui, said the company was “still aiming to recover… by year-end” its business volumes back to the levels observed before the de-linking, in August last year, of electronic wallets (e-wallets) from online gambling platforms in the country.
“The focus is on restoring the accessibility, strengthening engagement with our high-value users, as well as continue to invest into our product and enhancing the player experience,” Mr Tsui stated.
“This effort will help us recover most of our business before the end of this year,” he added. “We are very confident about the growth of the business in the long term.”
Asked about the group’s expansion to the land-based segment, Mr Tsui said the firm still expected to generate most of its revenues from the online segment.
DigiPlus has a convertible notes agreement with Hong Kong-listed International Entertainment Corp, which – if fully converted – would result in DigiPlus holding a 53.89-percent stake in International Entertainment. The latter firm controls the New Coast Hotel Manila, a property that has a provisional casino gaming licence.
“The proportion of revenue generated from the land-based and online segments will likely be 10 percent and 90 percent, respectively, maybe increasing to 20 percent and 80 percent in the following years,” Mr Tsui noted. “Online will still be the major contributor… because it’s very scalable compared to a land-based operation.”
DigiPlus said recently that it was exploring opportunities to expand into adjacent and complementary segments, following a report that it was in talks to buy the Diamond Hotel, a 480-room seafront property at Manila Bay.
On Thursday, Mr Tsui confirmed the company was exploring expansion opportunities, but said that no deals had been signed.
DigiPlus reported net income of PHP2.82 billion (US$45.9 million) for the three months to March 31, down 32.9 percent from a year ago. First-quarter consolidated revenue decreased 25.2 percent year-on-year, to PHP17.24 billion.
