“Casino development remains a primary component of our growth strategy and this experience has provided us deeper operational expertise, which better prepares us for success in future projects. We are actively pursuing new projects in existing ready player markets that we believe will add meaningful scale to our operations.”
Dreamworld Poipet Ramping Up
The Company held the grand opening for Dreamworld Poipet, a slot hall in the established gaming market of Poipet at the Cambodia-Thailand border, on May 9, 2013. This $7.5 million project, which the Company exclusively developed and operates as a stand-alone extension to an existing casino, houses approximately 300 premium quality EGM seats.
With eight existing casinos in operation, Poipet is an established and growing regional gaming market. Given Dreamworld Poipet’s prominent location in the area and targeted marketing programs, the Company’s goal is to ramp up these operations and capture a meaningful share of the market.
Dreamworld Poipet has a low operating cost structure and requires average WUD of only approximately $25 to achieve breakeven EBITDA. In July 2013, the Company achieved solid improvement in operating performance and these operations contributed positive EBITDA. The Company continues to refine and expand its marketing programs and has already established a meaningful and growing quality player base.
Strong Potential for Dolphin Gaming Products
The Company entered the third quarter of 2013 with a strong order pipeline of approximately $2 million in revenue and a more normalized cost structure for the new gaming chips and plaque manufacturing facility in Hong Kong. The plant is working double shifts (24 hours/day) to fulfill these orders from existing customers and expects to book this revenue in the third quarter of 2013.
With a strong existing customer base and relationships, a comprehensive suite of products and high-security production facilities located amidst the growing Asian gaming markets, the Company believes it is well positioned to benefit from the major casino development anticipated over the next several years in Asia. This combined with the ability to meaningfully reduce operating expenses in this relatively lower cost market, provides the potential to make the Company’s gaming products division a meaningful contributor to future earnings.