Phnom Penh casino NagaWorld has announced that gross gaming revenue (GGR) rose 48 per cent year-on-year for the first quarter of 2015, largely on the back of returns from VIP clients.

Nagacorp, the Hong Kong stock exchange-listed parent of NagaWorld, said in an unaudited report released yesterday that gross gaming revenue rose to $113.5 million in 2015’s first quarter from $76.9 million in the corresponding period last year.

Revenues for the mass market, made up largely of Southeast Asian clients, grew only 8 per cent to $47.9 million, while earnings from VIP clients grew a massive 101 per cent to $65.5 million.

In last year’s first quarter, mass market earnings stood at $44.3 million, $11.7 million above VIP revenues.

However, gaming analyst Michael Ting of CIMB said while comparing the two quarters showed a large increase, a deeper look showed mixed results.

“Last quarter last year [NagaWorld’s] VIP segment hadn’t seen much traction yet,” Ting said. “If you look at overall GGR, it’s only up 4 per cent from [the most recent quarter].”

According to Ting, investors “seem to be pleased” at the latest filing from Nagacorp, but regional competition to attract Chinese junkets, who demand ever-higher commission fees to bring in clients, could cut into profits.

“From a share price perspective, margins are a major concern,” Ting said.

Nagacorp stock closed at HK$5.62 ($0.72) a share yesterday, up 8.9 per cent from the previous day’s trading.

In February, Nagacorp announced its 2014 revenue had risen 17 per cent to $381.4 million, although net profit was down 3 per cent.

“The relatively lower net profit growth compared to GGR growth is a result of higher incentives given to junket operators to promote NagaWorld to the rest of Asia (including China) as well as higher staff costs to improve service quality and staff retention,” the company said in a statement.

However, the company remains optimistic its efforts will bring desired results, saying it will “bear fruit in the coming years as NagaWorld grows its market share in Asia.”