LEISURE LETTER (06/24/2014)

Tickers:  IHG, CCL


  • Today - 10 am CCL F2Q Conf Call


Four Seasons – Four Seasons has launched a luxury vacation rental site that offers private villas, residences and holiday homes in response to the growing popularity of Airbnb, FlipKey, VRBO and other short term rental booking sites. The web-site address is:  http://vacationrentals.fourseasons.com/  and includes upscale properties, urban residences, and resort villas around the world with fully equipped kitchens, and large indoor and outdoor spaces. Currently, the site has 13 properties in the Americas and the Caribbean, Africa and Asia

Takeaway: Cutting out the middle man while also preserving the brand integrity and offering. 


IHG – while the Board of Directors rejected an earlier take-over bid, rumors of a revised offer are circulating through media outlets.

Takeaway: Let the bidding begin, could a potential IHG buy-out be this cycle's Blackstone/Hilton transaction?


CCL – The sailing vessel, Queen Elizabeth, completed a recent 20-day refit of the 2068-passenger ship also involved laying more than 25,000sq m of carpeting, replacing more than 3000 mattresses, installing 1200 flat screen TVs, adding new awnings on the sun decks, re-modelling the Lido restaurant and Royal Arcade shopping area, replacing a 65-tonne alternator as well as the addition of nine single staterooms.

Takeaway: At a mere four years of age, CCL is making sure its UK super vessel stays hip and current. 


Macau & Union Pay – Jewelery shops inside casinos will have to remove all UnionPay China terminals and cancel means of withdrawing cash from there by Tuesday, July 1. 

Takeaway: During our trip last week to Macau it was apparent that operators were expecting this. 


Singapore- Singapore launches tourism campaign in China after hit by MH370 mystery and Thai crisis. The five million yuan (HK$6.3 million) marketing campaign that will last until October will encourage Chinese travelers to visit Singapore alone.  It is jointly organised by Singapore airport operator Changi Airport Group (CAG), the Singapore Tourism Board and Chinese and Singaporean travel agencies.  Edward Chew, regional director for the Greater China region at the Singapore Tourism Board, said the city-state is already “seeing more Chinese visitors travelling to Singapore as a mono-destination. They also stay longer than those on multi-destination package tours so as to enjoy Singapore at a more in-depth level.

Takeaway:  A needed stimulus to stem a declining trend in visitation


Florida Day Boat Gambling – Victory Casino Cruises begins offering a gambling-focused day cruise out of Mayport (Jacksonville) today.  The 600-passengers, high-speed catamaran will sail twice daily at 11 a.m. and 7 p.m. and features more than 300 slots, along with roulette, craps, blackjack, baccarat, poker, bingo and sports betting all for a mere $10 boarding fee, slightly more if dining is desired. 

Takeaway: Much easier and more affordable than a day trip to South Florida for Seminole sponsored gaming. 

New Jersey Sports Betting – The US Supreme Court opted not to review the State of New Jersey's appeal of lower court rulings that maintain the federal ban on sports betting. 

Takeaway:  A long road to legalizing sports betting 


Cambodia Gaming – The Cambodian government is in the process of amending its gaming laws in a bid to draw a major casino operator. The new draft of the national casino law could be finalized as early as this year.  Additionally, regulators are also considering legalizing online gambling in the country. However, NagaWorld, has a 70-year license for land-based, foreigners-only casino gaming, valid until 2065, and a 41-year gaming monopoly, ending in 2035, for activities within a 200-kilometre (124-mile) radius of the capital. 

Takeaway: Any new foreigners-only gambling would likely be targeted for northeast Cambodia near the Vietnam-Laos border or northwest Cambodia, near Krong Paoy-Paet, on the border of Thailand.


LEISURE LETTER (06/24/2014) - cambodia1


Hedgeye remains negative on consumer spending and believes in more inflation.  Following  a great call on rising housing prices, the Hedgeye

Macro/Financials team is turning decidedly less positive. 

Takeaway:  We’ve found housing prices to be the single most significant factor in driving gaming revenues over the past 20 years in virtually all gaming markets across the US.

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