Chen Lip Keong, one of the richest men in Malaysia, has passed away at 76. His death occurred on December 8 and was announced by the NagaCorp board in a filing with the Hong Kong Stock Exchange.

Chen, who developed the NagaCorp casino and hospitality brand, suffered a stroke a decade ago, sparking speculations that his death might be related to this. However, the leisure corporation’s board provided no specifics about his passing.

Later reports by Chinese news outlets claim that Chen passed away while in the US. His remains will likely be returned to Malaysia after a formal clearance process.

Chen spent the last few years of his life developing NagaCorp, cementing it as a major casino and hospitality brand in Asia. The news of his passing caused the company’s stock to plummet, although the leadership is certain that the loss of Chen will not lead to long-term material impact on the group’s finances.

As of the time of this writing, NagaCorp’s shares are trading for HKD 2.96, representing a significant decline from January 2023, when they had reached HKD 7.75.

What’s Next for NagaCorp?

In the meantime, Chen Yiy Fon, one of Chen Lip Keong’s sons, has succeeded him as head of the company starting December 10. Chen Yiy Fon already boasts significant corporate experience and has previously served as NagaCorp’s chief executive officer of operations.

Chen Yiy Fon started work as the casino and hospitality company’s CEO of Operations on April 5, 2022. His appointment came amid efforts to divide responsibilities for the company among Chen Lip Keong’s three sons.

For reference, this move saw Chen Yiy Hwuan named as chief executive officer of hotels and Chen Cherchi as chief executive officer of finance and treasury.

In its filing, NagaCorp did not disclose whether the change of leadership will have an effect on the ongoing strike at NagaWorld, one of the company’s biggest properties. Located near Phnom Penh, Cambodia, the huge resort is one of the highlights of NagaCorp’s portfolio. However, the property is currently dealing with a strike following the ousting of NagaWorld’s previous leadership.

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NagaCorp Ltd, a company incorporated in the Cayman Islands with limited liability and operator of NagaWorld integrated casino resort in Phnom Penh, Cambodia, published its full-year 2022 financial results, posting a net profit.

Positive Financial Results

For the twelve months ended December 31, 2022, NagaCorp generated revenue of $460.7 million, more than doubling its 2021 reading of $225.9 million. Compared to 2019 ($1.755 billion), 2022 revenue is down by 73.8%, casting aside any notion of pre-pandemic recovery.

Turning to the company’s shareholders, Timothy Patrick McNally, chairman of NagaCorp, highlighted the positive operational and financial results of the business that was impacted by the pandemic in the previous two years.

“The gradual recovery of our business and resiliency of our earnings in the face of major market disruptions placed NagaCorp as only one of the two regional gaming companies to achieve profitability during the period,” McNally stated.

Gross profit for the largest hotel, gaming and leisure operator in Cambodia was $376 million, up 162% on the previous year but down 55.6% compared to the pre-pandemic 2019.  50% of it, or $189.8 million, came from mass market table gaming, mass market electronic gaming machines contributed an additional 28%, or $103.9 million.

EBITDA for the twelve months at the gaming and hospitality operator listed on the Main Board of The Stock Exchange of Hong Kong came at $245.4 million. In 2021, EBITDA was just $15.6 million. The huge increase in EBITDA allowed NagaCorp to register a net profit of $107.3 million for the year as compared to a loss of $147 million in 2021.

ASEAN Reopening, Cost Control

The stable financial results were attributed to the gradual reopening in ASEAN and continued stringent cost control measures which resulted in a higher profit margin. The recovery of Cambodia tourism and visitations to NagaWorld also contributed to the bottom line of the operator.

NagaCorp reported that the average daily business volumes for its mass market and premium market segments in the year have recovered by 76.8% and 66.7%, respectively, compared to the pre-pandemic peaks in 2019. Both mass market and premium market gaming contributed about 94% of NagaCorp’s total gaming revenue.

The company’s non-mass referral VIP business declined during the year but as the number of direct flights to Phnom Penh continued to increase, the average daily numbers posted stable growth.

Non-gaming revenue of the company increased significantly year-over-year positively impacted by the reopening of business operations and the easing of travel policies in Cambodia and other countries in the region that increased footfall and occupancy rates.

“We believe that the long-term prospects and outlook of the Company are favourable, with the return of tourism and continued investment in the local Cambodian economy,” concluded McNally on the company’s future outlook, expressing the Board’s appreciation to employees, shareholders, customers and suppliers.

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