Mar 2011 - Monticello Analyst Presentation

Mar 2011 - Monticello Analyst Presentation

Monticello Grand Casino & Entertainment World
Tuesday 8 March 2011
Presentation Outline

Vision

Entry into Chile market

Legislative environment

Partners

Overview of the property

Earthquake

The Brand

Casino market & Monticello performance

Future prospects
Monticello Grand Casino
& Entertainment World
Vision
To become the most unique, exciting gaming and
entertainment destination in Latin America
Entry into Chile market

SI first investigated Chile in 2004 when the
new casino dispensation was being
introduced

Originally explored a partnership with the
largest operator in the existing municipal
casinos – Martinez family – Enjoy

SI liked the potential, the legislative
framework and proposed process

SI were only prepared to consider a major
casino aimed at tapping the Santiago market

Additionally SI concerned at having two
“operators” in partnership
Entry into Chile market

Martinez (Enjoy) did not want to bid for
Santiago but rather protect their existing Vina
del Mar investment

SI agreed not to compete with Enjoy up to
December 2006

Mostazal opportunity was introduced to SI in
late 2006 via Novomatic who had bought into
the project from the original successful bidders

SI only able to consummate deal in 2007,
complete probity and gaming licencing, finance
project and commence construction during
second half of 2007 with casino required to
open in October 2008
Entry into Chile market
Project needed substantial redesign and
much of this was done during construction
 Construction program:








Commencement of construction – November 2007
Casino opened – 8 October 2008
Paseo opened – September 2009
Hotel – 17 December 2009
Earthquake – 27 February 2010
Complex re-opened 30 June 2010
Highway accesses open – 15 October 2010
Legislative environment

New gaming legislation passed in 2005


Maximum of 3 casinos in each of
the country‟s 13 regions – must be
>70 kms from one another
7 casinos exist under old regime

Must convert in 2015

Tax rates vary per municipality but
generally lower than new regime
Legislative environment

15 new regime licences awarded in
2006

No major changes to gaming
legislation since 2005

Very well regulated environment
Partners

Sun International

Novomatic AG

Chilean Enterprises S.A.

International Group of Gaming and
Resorts Chile S.A.
Shareholder structure
Novomatic
50%
NovoSun
80%
Sun International
50%
Chilean
Enterprises
10%
International Group of
Gaming and Resorts
10%
San Francisco Resorts SA
100%
San Francisco Investments SA
Introduction to Novomatic
Novomatic Group of Companies:
 30 year old Austrian private company - founder and major
shareholder is Prof Johann Graff
 Origins in slot machine manufacture - with focus on
innovation and manufacture
 Diversified into sports betting and operating slot machines
in casinos, arcades and street venues
 Now also a content provider for licensed online and offline
suppliers
 Has become the largest integrated gaming group in Europe
Introduction to Novomatic
Novomatic Group of Companies (contd):
The group is now also doing business in America, Africa, Asia
and Australia with a particular focus on South America
 Is a very significant global gaming group and despite the tough
recessionary conditions recorded headline results:
 2009 Revenue of Euro 1.22 billion and EBITDA of Euro 400
million.
 2010 Interim Revenue of Euro 660 million and EBITDA 215
million.
 Employs over 10,000 employees worldwide.

Overview of the property – Floor plans
Casino ground floor
Casino first floor
Paseo Monticello
Overview of the property – Casino

Casino:



1562 Slot machines

566 Non Smoking

1252 - Video

996 Smoking

234 – Stepper

50 – Electronic Roulette & Black Jack

142 Prive

29 – Poker

34 Non Smoking

34 Smoking

16 Prive
84 Tables

27 - American Roulette

19 - Poker

25 - Black Jack

10 - Punto Banco

3 – Dice
300 Bingo seats
Overview of the property – Hotel and Convention
Facilities

2343 m2 Convention and meeting space

155 room hotel with Spa & Gym, 2 bars and restaurant
Earthquake

27 February 2010

Closed for 4 months – superficial damage

US$8.9 m for repairs

US$22.9 m for BI claim

US$2.2 m for marketing re-launch

Community project to help rebuild
homes in San Francisco de Mostazal

Reopened 30 June 2010
pics
Earthquake
pics
Earthquake
The Brand
Monticello Grand Casino y Mundo
de Entrentencion
‘Diversion en Grande’
Background

History of casinos in Chile


Location and limited family appeal
Research showed many potential customers
perceptions open to change

Do not trust

Not for the family

Wary / skeptical „cause they do not know how

But not averse to visiting
To introduce a new form of
entertainment to the market
A family entertainment
destination centered on a casino
The Brand and Reputation
• The product and its facilities
• Appearance and presentation of the
property
• The guest experience at all touch points
and times
• The first timers’ experience
• Most Valued Guest programme
• Advertising and other communications
Launch Campaign-The Creative Work-Press Insert
Promotional focus
• Gaming Promotions
• Build hype and excitement around the brand
• To reward
• To showcase winners
• People need to see others winning
• To influence play behaviour
•
•
•
•
Additional visit/s
Lengthen playtime
Attract to quieter times outside of peak periods
Change social behaviour eg: Sundays
Peak days in the week
¿Cuál es el primer casino que se le viene a la mente?¿Y cuál otro?
TOM
4Q10
Base: 313
Total Menciones
4Q09
4Q10
68,8
61,2
Monticello
32,9
31,9
Enjoy Santiago
9,8
Enjoy Santiago
1,0
La
Serena/Coquimbo/Peñuelas
2,0
0,0
Pucón
0,5
1,0
Puerto Varas
0,5
0,6
Las Vegas
0,4
0,6
Los Angeles
0,3
0,6
Iquique
0,3
0,6
Enjoy Colchagua
87,3
79,3
Monticello
Enjoy Viña
17,1
Enjoy Viña
4Q09
0,3
0,0
0,5
La Serena/Coquimbo/Peñuelas
2,9
4,8
Casino Juegos del Pacífico (San
Antonio)
2,7
2,2
Enjoy Colchagua
1,8
1,9
Pucón
0,7
2,2
Iquique
0,7
1,8
Puerto Varas
0,5
1,9
Las Vegas
0,4
0,0
Los Angeles
0,3
0,6
Enjoy Colchagua
0,3
1,9
Arica
0,2
0,8
Temuco
0,2
0,0
59,6
24,7
40
¿A cuál o cuáles casinos ha asistido en los últimos seis meses?
Total menciones espontáneas
1Q09
2Q09
3Q09
26
Monticello
29
40
Enjoy de Viña
38
29
35
Pucón
2
4
Enjoy de Colchagua
Casino Enjoy Puerto Varas
Enjoy Santiago
Casino Juegos del Pacífico (San
Antonio)
0
2
45
47
15
19
20
12
6
5
5
9
0
3
2
0
0
0
0
0
0
0
0
74
7
2
Arica
46
13
10
0
0
4Q10
7
10
7
La Serena/Coquimbo/Peñuelas
Iquique
4Q09
8
2
1
0
0
0
0
1
41
Finalmente, entre Monticello y Enjoy Santiago ¿cuál de los dos casinos
prefiere?
Base: 313
Monticello
Enjoy Santiago
89
88
81
85
81
80
79
85
69
65
35
31
21
19
20
19
Total
ABC1
C2
C3
15
15
12
11
Hombre
Mujer
18 a 24 años
25 a 40 años
41 a 54 años
55 años y más
42
Non-gaming promotions, events and
entertainment

To reward customers

To build the brand as a multi-dimensional entertainment
experience through PR and word of mouth

Examples:

Jennifer Lopez & Marc Anthony

Tennis masters

High profile Chilean artists
Customer Strategy – relationships with
customers

Top down focus with commensurate levels of personalization
and reward

Tiered approach

2-way communications
Casino Market and Monticello Performance

Map of Chile and locations

Direct competitive landscape

MVG Data

Revenue & EBITDA trends

Costs
New Casinos In Chile
Casino Sol Calama
Latin Gaming S.A
Enjoy Antofagasta
Enjoy S.A
Antay Casino & Hotel
Gran Casino Copiapo S.A
Casino de Juegos de Ovalle
Casinos Austria
Enjoy Santiago
Enjoy S.A
Enjoy Viña del Mar (Municipal Casino)
Enjoy S.A
Monticello Grand Casino
San Francisco Investment
Casino de Juegos Del Pacífico
Casino de Juegos Del Pacífico S.A
New Casinos In Chile
Monticello Grand Casino
San Francisco Investment
Casino de Colchagua
Casino de Juegos de Colchagua S.A
Gran Casino Talca
Casino Talca S.A
Termas de Chillán
Casino de Juegos Termas de Chillán S.A.
Marina Del Sol
Marina Del Sol S.A
Gran Casino Los Angeles
Casinos Austria
Dreams Temuco
Dreams S.A
Dreams Valdivia
Dreams S.A
Casino Sol Osorno
Latin Gaming S.A
Enjoy Castro
Enjoy S.A
Dreams Coyhaique
Dreams S.A
Dreams Punta Arenas
Dreams S.A
SCJ Casinos Win
(US$)
Casinos de Juego
Monticello Grand Casino
Annualized
%
126,846,677
28.4%
Marina del Sol
57,272,323
12.8%
Casino de Juego de Rinconada
48,327,242
10.8%
Enjoy Antofagasta
46,484,701
10.4%
Dreams Temuco
31,898,476
7.1%
-
30.5%
447,211,305
100.0%
Others
Total US$
Monticello Direct Competition
150 km
100 km
50 km
Monticello
•Enjoy Santiago
•904 slot machines
•50 tables
•200 bingo positions
• 3 Restaurants
•Night Club
•Viña del Mar
•1.200 slot machines
•48 tables
•200 bingo positions
• 2 restuarants
•Conference Center
•Night Club
•5 star Hotel, 90 rooms
•San Antonio
•300 slot machines
•16 tables
•296 bingo positions
•4 Star Hotel, 60 rooms
•Santa Cruz
•230 slot machines
•19 tables
•60 Bingo positions
• Restaurant
Geographical Segmentation Of Monticello Database
Region
RM
VI
V
Others
Total
Total
75%
16%
2%
6%
100%
•Over 93% of MVG cardholders comes from RM, V or VI
Market Share vs Enjoy Santiago Jan 09 to Jan 11
Source: SCJ Statistics Report
MVG database - monthly growth
MVG database
Demographic Segmentation
16.0%
14.5%
14.0%
12.4%
12.0%
10.2% 10.2%
10.0%
8.8%
8.0%
8.7%
8.2%
7.4%
6.4%
5.9%
6.0%
4.5%
4.0%
2.8%
2.0%
0.0%
18 - 25
26 - 35
36 - 45
Female
46 - 55
Male
56 - 65
66 - +
Feb-11
Jan-11
Dec-10
Nov-10
Oct-10
Sep-10
Aug-10
Jul-10
Jun-10
May-10
Apr-10
Mar-10
Feb-10
Jan-10
Dec-09
Nov-09
Oct-09
Sep-09
Aug-09
Jul-09
Jun-09
May-09
Apr-09
Mar-09
Feb-09
Jan-09
Dec-08
Nov-08
Oct-08
Daily average sign ups
600
500
400
300
200
100
-
Revenue Trend
EBITDA Trend
Analysis of Costs
Costs as % of revenue
Revenues
Casino Levies & VAT
Tables costs
Slots costs
Rooms costs
F & B costs
A&G
Marketing
Property costs
Management fees
Other
EBITDA
100%
29%
6%
6%
2%
8%
9%
14%
8%
4%
1%
14%
Future prospects

Why can we continue to grow over next 3
years

Growth of specific days – eg Sundays

Adapting to local demand and conditions

Penetration and customer sign ups

Current capacity

Future capacity

Bingo area
Why expect market growth

The potential of the market has not been reached

Current estimated propensity to gamble for regions V, VI and
RM is 0.4%

Growth to a propensity 0.6% is probable over the next few
years and a potential of probably 0.8%

New form of entertainment in Chile suggests at least 3 to 4
years to signs of maturity

Addition of Enjoy Santiago is growing the market
Muchas Gracias