Widetech rolls the dice on Asean

Date : Saturday, 22 October 2007

KUALA LUMPUR, SATURDAY, 22nd OCTOBER 2007 - In spite of restrictions in the Malaysian home market hindering it from participating in the country's gaming industry, Widetech (Malaysia) Bhd has kept busy by making inroads into the industry in the Asean region.

Chief executive officer Daniel Kong told The Edge Financial Daily that regional governments were, in general, cautious of opening up the gaming industry due to negative factors related to it, even though the industry could contribute volumes in taxes.

As such, the industry was restricted by regulations, with government decisions often taking a long time and licences mostly given to foreign companies, while the gaming establishments themselves were predominantly set up on the borders of countries, he said.

Widetech has however succeeded in capitalising on the industry in Asean, with its gaming division already contributing RM1.2 million to its net profit for the financial year ended March 31, 2007 (FY07), despite commencing operations only in the fourth quarter of FY07 in Cambodia and Vietnam.

Come November this year, the company will open the doors of its Riveria Hotel in Laos, a 50-room establishment equipped with gaming facilities.

Most of its gaming establishments were on the premises of hotels, namely Princess Hotel in Cambodia and Nha Trang Lodge Hotel in Vietnam although Widetech did also operate standalone gaming centres, said Kong.

On the possibility of setting up a casino, he said the company would consider it, and would look into the prospects, but added that it would be a huge endeavour.  Casinos are a very big investment, even a small one would require an investment of US$10 million (RM34 million) or more, and a big one would go into the hundreds of millions (of dollars),he said.

Additionally, although developments in the gaming industry in Macau and Singapore had stirred interest of late, Kong said the company was not looking into entering Macau at the moment as it required high investment and there was a lot of competition. Neither could Widetech enter Singapore as the country's gaming licences had already been given out, he added.

Meanwhile, on future profits for the division, Kong said results in FY08 would not be as good as FY07 due to recent raids by the authorities on gaming centres in Vietnam. None of Widetech's operations were raided. He also said some of its premises in the country were under renovation.  FY09 will be more promising because of Laos, and we're waiting for things to settle down in Vietnam, he said.

On the outlook for the regional gaming industry, Kong was optimistic. He said it was good and had a lot of promise despite being held back by regulations, adding that there was also a healthy demand for gaming in the Asian region.