RGB sees double-digit growth
Gaming machine maker to hit sales target of RM169mil by Q3
GEORGETOWN: RGB International Bhd expects to close its fiscal year ending Dec 31, 2017 with a strong double-digit growth in its sales and bottomline over 2016.
Group managing director Datuk Chuah Kim Seah ( pic) told StarBiz that the electronic gaming machine and equipment maker would likely hit sales target of US$40mil (RM169mil) or about 600 machines by the third quarter.
“In the first half of this year, we have achieved sales of about RM51.91mil.
“The orders in hand to date for the second half is about RM63.3mil. We expect more orders to come in before the year closes,” he said.
“The largest deliveries are to the Philippines, Vietnam, Cambodia, Malaysia, Nepal and Laos,” said Chuah.
Apart from manufacturing gaming machines, RGB leases out the equipment to gaming companies under a long-term concession busi- ness that contributes to 40% of revenue currently.
On the group’s concession business, Chuah said RGB was getting ready to install 300 machines in Asia.
The new markets that the group would focus on in 2018 include South America.
“The group’s cash in hand is about RM80mil. We will use some to expand our business in fresh markets such as Nepal and South America.
“Nepal is an exciting market which can serve as a gateway to the markets in South Asia,” he added.
The group is currently working with a partner in Nepal to promote its range of gaming machines to South Asia, which includes India, Nepal, Bangladesh, Pakistan, Bhutan and Sri Lanka.
Chuah said the group had shipped some new gaming machines for a trial run of three to six months to a South American customer.
“We believe South America can provide us a sizeable revenue stream eventually,” he said.
In Malaysia, Chuah said the domestic sales are expected to increase to 100 units from 50 last year. “Projected sales in Malaysia is RM10.55mil for 2017,” he added.
For the 2016 financial year ended Dec 31, the group posted RM24.8mil in net profit on the back of RM253.5mil in turnover, compared to the RM20.8mil and RM233mil achieved in 2015.
RGB derives 95% of its sales from the Asia-Pacific region.
Besides the RGB brand name, the group also distributes international brands in various Asian countries.
For the second quarter ended June 30, the group posted RM8.8mil in net profit on the back of a RM59.7mil revenue, compared to RM7.1mil net profit and a RM58mil revenue in the same period last year.
According to Technavio’s Global Casino Gaming Equipment Market 2017-2021 report, the global casino gaming equipment market is expected to grow at a compounded annual growth rate of 15.25% over the next four years.
The report said countries, such as Japan, are aiming to legalise casino gaming because it generates high revenue contribution globally. An increasing middle-class population and rising disposable income are fuelling market growth.
This has led to a rise in new casino centres across the world. The report said Marina Bay Sands, which opened in April 2010, generated a revenue of US$1.06bil from its casino in 2010 and more than US$2.3bil in 2015.