Lawrence Ho, Chairman and CEO, Melco Resorts & Entertainment: Interview

Interview: Lawrence Ho

How does the country compare to other ASEAN states as an entertainment destination?

LAWRENCE HO: The Philippines is unique in ASEAN: outside of gaming, the whole market is undergoing a step change in its consumer orientation. It is one of the region’s top gaming and entertainment destinations. The tourism market is attractive and growing fast, infrastructure is rapidly improving and expanding, and, geographically, it can attract potential players and tourists who have already developed interest from the more established gaming spheres in both Macau and Australia. With visitor arrivals set to continue increasing from in and around the region in conjunction with infrastructure improvements moving forward, we anticipate healthy revenue and earnings growth in the year ahead.

Demand for luxury entertainment is on the rise throughout Asia. It stretches beyond attractions or amenities: it is about customers wanting to have an entire ecosystem of luxury experiences. In the Philippines specifically, we’ve been seeing strong demand in the VIP and premium-mass segments, so we will, therefore, continue to expand our retail, entertainment and hotel offerings accordingly.

Furthermore, we have strong relationships with the regulators of the markets in which we operate. It is of vital importance to have regular engagement and an open dialogue between operators and regulators to continue to learn from each other and find solutions.

How do you see the balance between in-country residents and overseas visitors as drivers of future demand in the luxury entertainment segment?

HO: Across our resorts in Asia we have seen a substantial increase in foreign visitors, particularly Chinese consumers in the premium-mass segment. Research has shown that this segment is growing exponentially: today it is made up of 64m Chinese consumers and is set to nearly double to 120m by 2025. These consumers are well travelled, discerning and seekers of culture and experience. They come to us for an entertainment experience beyond gaming. We expect this demand to continue and to be the driving force behind the growth of the luxury entertainment segment in the country.

What more can be done to position the Philippines as an international luxury destination?

HO: The Philippines has always been an ASEAN centre, attracting visitors from South-east Asian countries, South Korea and Japan. Ever since the government in the Philippines opened up the gambling market to international bidders, gaming has been a driving force for the tourism industry. The challenge now is to capture a more diverse visitor base, in particular Similarly, in 2006, when we first introduced Altria in Macau, the enclave was a smoky gambling den. Casino concession operators invested considerably to bolster non-gaming offers to attract the growing number of premium travellers. As the local gaming market matures – Credit Suisse projects that the Philippines gaming industry gross gaming revenue could reach $6bn by the end of 2018 – diversification will enable it to grow into a luxury entertainment destination.

Taking the local culture into account is also important. We want to build resorts that contribute to the development of the local community. As a result, we don’t develop cookie-cutter resorts. Instead, each resort should offer different experiences, and guests should have a memorable and distinctive experience to the resort that hosts them. Entertainment programmes should also be dynamic, taking their expecWe also place the highest value on employee training and making infrastructure improvements. Employees are at the front line, so we need to invest in training and creating a happy working environment to allow them to do their jobs better. These are all important components that will impact guests’ experiences.