City of Dreams will be a must-see integrated urban entertainment resort that will combine electrifying entertainment, stylish nightclubs, an amazing array of accommodation options, top-notch dining, world-class shopping as well as a spacious and contemporary casino.

“Our dreams are taking shape. In approximately one year, City of Dreams will begin to welcome visitors from all over the world,” said Lawrence Ho, Co-Chairman and CEO of MPEL at the topping out ceremony. “Macau is transforming from a gaming-focused destination into a leisure hot spot. City of Dreams will continue to drive this phenomenon and usher in a new era of gaming and entertainment in Macau.”

In addition to approximately 2,200 guest rooms and a wide range of restaurants and bars, City of Dreams will offer a kaleidoscope of entertainment options including stylish nightclubs, live music venues, free attractions and the spectacular Dragone show. The resort will also incorporate a 420,000-square-foot casino with over 550 gaming tables and 1,500 gaming machines.

One of the iconic landmarks of City of Dreams will be a free attraction that will provide visitors with a totally immersive experience, unlike anything they have seen in Asia or elsewhere in the world. Housed in a unique dome-shaped theatre, the production will combine high-definition video content, a customized music score, thousands of theatrical lights and a variety of sensory effects to create a spectacular 10-minute visual extravaganza that is sure to become a must-see for every visitor to Macau.

Renowned for spectacular and imaginative productions, Dragone will stage a permanent show at City of Dreams. Founder Franco Dragone will personally direct the breathtaking water-themed show, created specifically for City of Dreams, which is due to open in Macau in the second half of 2009.

A variety of musical performances by well-known regional acts, emerging artists and cover bands will be staged at a live concert venue that can accommodate up to 1,500 people.

The different styles of accommodation at City of Dreams will meet the diverse tastes of the wide spectrum of visitors the resort will attract from Asia and around the world. The options will include Crown Towers Cotai, Hard Rock Hotel, the Grand Hyatt’s twin towers and the apartment hotel, which will together provide over 2,200 guest rooms and suites. Each hotel will also offer its own individual spa and leisure facilities.

“We introduced the Crown brand into Macau in 2007 with the opening of Crown Macau, which has quickly become the property of choice for high-rolling VIP customers in Macau,” said Mr. James Packer, Executive Chairman of Crown Limited, and Co-Chairman and Director of MPEL. “We are very excited about extending the Crown brand in Macau, which is synonymous with a luxury six-star experience, through the opening of the Crown Towers Cotai at City of Dreams. City of Dreams is testament to our optimism about the future rapid development of the Macau market.”

City of Dreams will also feature a broad range of restaurants, noodle bars, cafes and lounges. These food and beverage venues will be located throughout the resort offering fine dining experiences as well as casual meals.

The resort will be home to some of the world’s most sought-after and acclaimed brands, with approximately 175,000 square feet of boutiques featuring high-end fashion labels as well as premium jewellery and watch brands.

Phase one of the City of Dreams resort will feature the casino, restaurants, retail boutiques, nightclubs, the iconic audio visual attraction, Crown Towers and Hard Rock Hotel. Phase one will be completed during the first half of 2009 with the date of the grand opening to be set early next year. The operation of the entire City of Dreams will require the support of 12,000 employees, which the company intends to recruit through a series of career fairs in Macau and throughout Asia starting in the summer of 2008.

With permission :: Melco PBL

• Hard Rock Hotel and Casino Coming To Macau
• Hard Rock Hotel and Casino Macau Signs With Melco PBL
• DRAGONE “City of Dreams” Show Looking For Personnel
• May 12 | Official Opening Crown Macau
• Crown Macau Officially Opened by James Packer

The Hong Kong-listed company said its net profit in the 12 months ended Dec. 31 was HK$2.69 billion (US$346 million; ?219 million), down from HK$2.84 billion in 2006.

Melco ? controlled by Lawrence Ho, son of Macau gaming magnate Stanley Ho said revenue rose 27 percent to HK$1.02 billion (US$131 million; ?83 million) from HK$801 million.

The company’s board proposed a final dividend of HK$0.01 (US$0.001; ?0.0008) per share, unchanged from a year earlier.

Melco booked a gain of HK$3.1 billion (US$398 million; ?252 million) from the listing of unit Melco PBL Entertainment Macau Ltd. (MPEL) in the U.S. in December 2006.

Melco PBL is one of six licensed casino operators in Macau, the only place in China where casino gambling is allowed.

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• Macau’s Biggest Slot Machine Supplier Profit Up By 20%

City of Dreams Complex

According to the Daily Telegraph, Crown Macau owned by Melco PBL Entertainment, James Packer’s first casino foray in the city had a rocky start after its opening in May last year.

But its fortunes have been given a major boost as a result of a strategic deal late last year with a Hong Kong-listed junkets operator, A-Max, and the decision to refocus the casino entirely on the VIP market.

The aggressive deal with A-Max, which involves higher than industry average total commissions of up to 1.35 per cent, has helped bring VIP gamblers to the upmarket casino, taking market share off more experienced operators, such as Macau veteran Stanley Ho and new players Galaxy and the Macau Sands.

“Thanks to A-Max’s junkets, Melco PBL’s market share improved substantially from 5.7 per cent in November to 18.1 per cent in February, making Crown Macau the busiest casino in the world in terms of betting volume,” Credit Suisse’s Hong Kong-based gambling analyst, Gabriel Chan, says in a bullish new report on the company.

“If we focus on market share in the high-roller segment alone, the improvement was even more astonishing with market share increasing from 6.6 per cent in November to 24.8 per cent in February.”

“A-Max junkets generated about $US5.3 billion ($5.8 billion) in rolling chip turnover in February, up about 5 per cent month on month,” he said.

“In our view, there is room for further growth.

“We expect A-Max’s junkets to generate on average $US6.3 billion rolling chip turnover per month in 2008.” Packer’s Crown now has a 37.9 per cent stake in the company, which listed on the US Nasdaq market in late 2006, alongside the Hong Kong-based Melco, operated by Stanley Ho’s son Lawrence Ho.

Macau observers say the aggressive deal struck with A-Max has seen the junket operator bring in substantial new volumes of high-rollers to Crown Macau, which has been difficult for its rivals to match.

“There has been a dramatic shift in the market since December,” one Macau veteran said last week.

“Stanley Ho’s junket operators have been struggling. Galaxy has been losing market share as well.

“It has not been easy for them to find the consolidators who can bring in the same horsepower as A-Max.”

Under the deal, A-Max, a consolidator of junket operators, receives a total commission rate of between 1.2 per cent and 1.35 per cent from Crown.

A-Max in turn pays its junket operators up to 1.2 per cent.

In the past, Macau casino operators would only pay around 1.1 or 1.2 per cent in total to junket operators to bring in high-rolling gamblers to their premises.

Observers say the financial viability of the Crown Macau deal with A-Max, which involves a potentially higher total commission structure, is dependent on A-Max being able to deliver high volumes, which has so far been the case.

Macau gaming turnover continues to increase, with total monthly revenues twice the level of the Las Vegas strip in recent months.

Unlike last year, which saw a flood of new casino openings in Macau, 2008 is not expected to see any substantial new supply come on to the market, giving the existing operators a chance to consolidate their positions.

The past few months have also seen Crown enjoy an increase in its “hold rate”, or house percentage retained, which has also helped the success of its operations. “Crown’s hold rate was terrible,” said one observer.

“It used to be around 2.2 per cent on baccarat, but now it is 2.7 per cent.”

Crown’s success has put pressure on its rivals to increase the commissions paid to junket operators. As Chan notes in his report, the junket operators now have more bargaining power in Macau than the casino operators.

Chan says that Galaxy’s market share has dropped from 14.9 per cent in November to only 10.3 per cent in February.

“Galaxy has extended credits to select junket operators and raised its commission rate to 1.25 per cent, even higher than the 1.2 per cent A-Max is paying junket operators,” he notes.

The new competition from Crown has also prompted Sheldon Adelson’s massive Venetian, which opened in mid-2007, to revise its commission structure, a move which has helped to boost its market share by 2 percentage points to 12 per cent in February. The Venetian’s commission rate is now 1.26 per cent.

Chan predicts that Melco PBL’s earnings before interest, tax and depreciation could reach as high as $US280 million in 2008. “With a total construction cost of about $US570 million, we estimate Crown’s payback period to be only about two years,” he says.

• Crown Macau: the new VIP king
• Melco PBL Fails to Raise Much Needed Cash
• Crown Macau Winning With VIP Junkets Deals
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• Melco PBL Shares Tumbles 50%

The award recognizes outstanding design in the casino sector. The winner was judged on originality, innovative style, quality of materials and customer friendly environment. See Crown-Macau.com

Among all the hotels & casinos currently run in Macau, “Crown Macau” is the first property to receive the “Best Interior Design” honor and earn international recognition.

“Crown Macau” stood out from seven other contestants including the short-listed Grand Lisboa Hotel and Casino as well as the Venetian Macau Resort to win the 2008 award.

The overall design concept of “Crown Macau” was originated from the mastermind of the Co-Chairman and CEO of MPEL, Lawrence Ho. “We saw a niche existed in Macau for a world-class contemporary and non-traditional luxurious hotel casino aiming to provide a 6-star experience to VIP customers,” said Ho.

“Crown Macau is actually a collective result from various designers, and I would like to take this opportunity to thank the designers and architects who helped to bring my ideas and vision to reality. Needless to say, this award also proved that all our efforts did not go in vain,” he continued.

Peter Remedios, a world-renowned and award-winning interior designer, is one of the designers who helped bringing Lawrence Ho’s ideas to life. Rem?dios also designed a number of high profile hotels including Four Seasons New York, Grand Hyatt Tokyo and Landmark Mandarin Oriental in Hong Kong.

As the tallest building on Taipa Island, “Crown Macau” is uniquely positioned to offer panoramic views of the Macau peninsula from its spectacular Sky Lobby on Level 38, and expansive floor-to-ceiling windows featured in every guest room and suite.

James Packer, Executive Chairman of Crown Limited, also the Co-Chairman of MPEL, said “We are delighted that Crown Macau has received this international accolade. It is indeed an honor for Crown Macau to receive this prestigious award.”

Mr. Packer also congratulated the designers, architects and operators of “Crown Macau.

This first-ever “International Gaming Awards 2008″ was a memorable evening for the gaming sector and was attended by international manufacturers and gaming operators.

With permission by :: Crown-Macau.com

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Ten Macau gambling representatives signed a new agreement this month to take their high rollers to the Crown Macau, which opened in May. The casino is operated by Melco PBL, a joint venture between Australian tycoon James Packer and Hong Kong businessman Lawrence Ho, son of Macau casino pioneer Stanley Ho.

The $565 million Crown Macau is on Taipa Island, between the main casino cluster on the Macau Peninsula and the growing gaming operations on the Cotai Strip.

The new arrangement could funnel a higher volume of the VIP business to Crown Macau’s ultraluxurious private gambling rooms and away from the just-as-luxurious gambling suites at the Sands-owned Venetian Macau and Sands Macau and the Wynn-owned Wynn Macau.

“It is still too early to know the impact of this deal,” Goldman Sachs gaming analyst Steven Kent said in a note to investors. “Wynn and Las Vegas Sands properties have amenities beyond just gambling and we suspect many gamblers would rather go to these facilities.

“However, if the customer is beholden to the junket operators, either due to history or other services, then the customer may be forced to go with the junket choice.”

Roughly 70 percent of Macau’s annual gaming revenue comes from the high-end VIP business, analysts said. The recent opening of the $1.2 billion MGM Grand Macau added a player seeking action from the VIP customer.

The Crown Macau’s private gaming salons are on the 37th floor of the 38-story resort and have spacious gambling quarters, private dining and living rooms and expansive views of the Macau Peninsula.

In an interview in September, Crown Macau CEO Greg Hawkins told the Review-Journal that a high-end customer is required to put up $30 million in Hong Kong dollars for gambling purposes, roughly $3.9 million in U.S. currency, to gain access to the private salons.

Kent said the junket representatives, who will receive a higher commission rate from the deal, will guarantee a certain amount of high-end play to the Crown Macau.

“In the near term, this play could come out of existing Macau casinos and could create short-term volatility in this driver of individual property results,” Kent said. “However, it remains to be determined how successful the deal will be and which casinos the play will flow out of and we still believe there is significant growth potential in the Macau VIP market.”

Source :: Las Vegas Gaming Wire

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Earlier this month Melco PBL announced a USD142 million loss for the nine months ending September 30. The third quarter saw the company lose USD45.2 million, five times the loss sustained in the same period last year.

While the poor result was blamed on license and opening costs, the company is confident a high-roller strategy will move it into the black.

Crown Macau is in the process of reverting to an almost totally VIP-focused casino, with some 187 tables to be dedicated to VIP gamers and a maximum of 60 for the mass market.

It is not so much a new idea but a reversion back to the original plan, according to Mr Ho.

“That was the original vision three years back and when it opened we kind of went away from that,” he said.

“I think in hindsight, the original vision that I had was completely right and that’s why we’re going back to the original track.”

Market revenue from VIP Baccarat tables continued to climb last quarter to US$17o million or a 67 percent share of the games of fortune revenue.

The next earner for casinos is mass market baccarat that pulled in just over US$500 million for the nine months until September 30.

Contracts with some 20 junket operators, who will bring VIP gamers to the casino and finance their high stake betting, is the basis of Crown Macau’s strategy.

At a cheque presentation ceremony yesterday for a US$175,000 donation to the International School of Macao, Mr Ho said plans for the City of Dreams Cotai project were also now on track.

“We have received the contract from the government (for the land) and have agreed to it and now we are waiting for the gazettal,” he said.

Although not receiving the land that was originally asked for, Mr Ho hopes the company’s investment in Macau will help with future negotiations.

“Melco PBL Entertainment, you could make an argument, other than SJM who have been here for 40 years, have invested probably the most in Macau,” he said.

“If you look at what we had to invest in the gaming license, we bought it for 900 million, we’re putting close to 3 billion dollars into City of Dreams, we put about 550 million into Crown Macau so we hope that we have more opportunities and the government gives us opportunities.”

Melco PBL are targeting a March 2009 opening date for phase one of the City of Dreams project, which will include a 420,000 square foot casino and approximately 145,000 square feet of retail space, as well as the 370-room Hard Rock Hotel and Crown Towers Hotel, Cotai, with approximately 300 rooms, suites and villas.

The company will be hoping its relationship with the government will help the development of its first peninsula site, tentatively named Trinity.

The company pushed back a US$192 million land purchase from July this year until mid 2008, and reportedly is targeting a 2010 opening for the US$745 million resort-casino.

Yesterday Mr Ho said plans were not concrete and the company was assessing the effect of the first Cotai project on the peninsula.

“We’re 100 percent committed to building it (Trinity project),” he said.

“We want to see how the market plays out. Obviously the Venetian is a big draw away from the Peninsula so we just want to study that.”

Courtesy: Macau Daily Times

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Giuliani’s participation as a security consultant in the Singapore gambling venture illustrates the challenge he faces while attempting to win the Republican presidential nomination with a law-and-order message while maintaining a far-flung, international business portfolio, an unknown portion of which remains in the shadows.

As a candidate, Giuliani is banking on his reputation as a hard-nosed prosecutor and a crime-fighting mayor, along with his performance after the Sept. 11 attacks, to trump doubts about his turbulent personal life, his tolerant stands on gambling, abortion and other social issues and perhaps some of the decisions he’s made as a businessman.

So far, the strategy seems to be working, as Giuliani leads most polls of GOP presidential contenders.

But as the primary campaign nears its first electoral tests in Iowa, New Hampshire and other states in the coming weeks, new details of Giuliani’s extensive business dealings since leaving office continue to emerge piecemeal. Each revelation raises new questions for the first major presidential candidate in memory to build a multi-million-dollar business on the foundation of his time in elected office, and not the other way around.

Even today, more than a year after the former New York mayor signaled his intention to run for the presidency, it remains impossible to fully evaluate Giuliani’s business dealings because he has declined to list all of the clients in Giuliani Partners, the consulting firm he founded and heads.

Questioned during an appearance Tuesday in Chicago, Giuliani said that, “all of Giuliani Partners’ clients, maybe with one or two exceptions, I’m not even sure that’s right, are public….At least the ones that I was familiar with.”

Confidentiality agreements prohibit disclosure of an unspecified number of clients, Giuliani said, “but somehow I think you–you meaning the press in general–have been successful in discovering. I’d have to check if it’s every client. But just about every single client of Giuliani Partners. You’ll have to check with them.”

A spokeswoman for Giuliani Partners said that “a number of client relationships…must remain confidential, as per the specific request of those clients.”

She did not respond to questions about whether Giuliani was asking those clients to waive privacy in light of his presidential bid.

Giuliani’s public involvement in the gaming bid began at a September 2006 press conference in Singapore hosted by Mark Advent, CEO of Eighth Wonder LLC, a Las Vegas development company heading one of three consortia competing to build the Sentosa Integrated Resort.

Giuliani Security & Safety LLC, a division of Giuliani Partners, was to provide security on a celebrity-studded, multi-billion project featuring participation by soccer legend Pele, chef Alain Ducasse, New Age guru Deepak Chopra and designer Vera Wang, according to Advent.

Advent estimated that he spent more than $30 million to assemble and present his plans to Singaporean authorities. He declined to disclose the fees paid to Giuliani, but described them as “fair and priceless.”

Advent said he sought Giuliani’s services because he was impressed by the way Giuliani ran New York, before and especially after the Sept. 11 attacks. “In my personal opinion, the mayor is the best crisis manager, post-traumatic event, of anyone I’ve ever seen,” Advent said in a recent telephone interview.

Behind the scenes, Giuliani had been involved in the project for three months before his involvement was made public, and he had a 10-year agreement to provide “security management on all levels,” including employee background checks, security features and disaster response, said Advent, who previously developed Las Vegas’ New York, New York casino.

Giuliani participated in Eighth Wonder’s presentation to Singaporean authorities last Nov. 29, according to Advent. That was nine days after the Rudy Giuliani Exploratory Committee Inc. registered with the Federal Election Commission.

Advent said he never discussed how the consulting arrangement would be affected if Giuliani ran for president. “At no time did Rudy ever talk politics with me,” Advent said.

Advent described Giuliani as extraordinarily concerned about his firm’s partners and associates. “They did a tremendous amount of due diligence…They wanted to make sure they vetted everybody,” Advent said. But in a later interview, Advent said Giuliani’s vetting only extended to Advent and his Eighth Wonder colleagues, and that Giuliani had no role in evaluating Eighth Wonder’s outside partners.

Those partners would include Melco PBL, a joint venture based in Hong Kong which joined the project, with a 24.5 percent equity stake in October 2006, according to Advent.

Melco PBL is a collaboration between Publishing and Broadcasting Limited (PBL), an Australian firm run by James Packer, son of the late media magnate Kerry Packer, and Melco International Development, run by Lawrence Ho, son of Stanley Ho, a colorful casino tycoon.

At 85, Stanley Ho remains the dominant player in the gambling industry on Macau, an 11-square mile spit of land near Hong Kong on China’s southeast coast.

A Portuguese possession for more than 400 years until it was returned to China in 1999, Macau has long been the gaming capital of Southeast Asia. For 40 years, until 2002, Stanley Ho held a monopoly on casinos there.

Even now, with the Macanese gaming market open to foreigners, including Americans, Stanley Ho and two of this 17 children, Lawrence Ho and Pansy Ho, have an interest in three of Macau’s six casino licenses.

Although he has never been charged with a crime, the U.S. government’s 2000 International Crime Threat Assessment described Stanley Ho as “a reputed organized crime figure.”

A 2007 State Department narcotics and law enforcement report noted links between casinos controlled by Stanley Ho and Chinese organized crime.

In addition, Stanley Ho retains ties to the regime of North Korean dictator Kim Jong Il. In 1999, he opened a casino in Pyongyang.

In March 2003, the South China Morning Post, the main English-language newspaper in Hong Kong, reported that Stanley Ho conveyed an offer of asylum in North Korea by Kim to Iraqi ruler Saddam Hussein. The State Department has designated North Korea a state sponsor of terror since 1988.

A spokeswoman for Stanley Ho declined to comment.

Advent and Giuliani’s spokeswoman said Stanley Ho had no involvement in the Singapore casino bid, pointing out that Stanley Ho has no direct interest in Melco PBL.

“We did business with Lawrence Ho,” Advent said. “It has nothing to do with his dad…He (Lawrence Ho) has a separate company.”

A spokeswoman for Melco PBL said that “Dr. Ho was not involved in the Singaporean bid and he is not involved in the affairs” of Melco International, PBL or their joint venture Melco PBL.

According to Hong Kong regulatory filings, Stanley Ho resigned as chairman and director of Melco International, sold the bulk of his shares in the company and turned over leadership of it to Lawrence Ho, in March 2006, about seven months before Melco PBL’s participation in the Singapore casino bid was announced.

But at the time of the bid, Stanley Ho and a firm controlled by him still owned more than 21 million shares of Melco International–just under two percent of the shares outstanding.

In addition, regulatory filings in Hong Kong and the U.S. show a series of loans and contracts for computer services and gaming machines between Melco International and Stanley Ho-run firms. Melco International reported spending about $2.4 million as its share of costs to pursue the Sentosa license through Melco PBL.

The Giuliani Partners spokeswoman termed the link between Stanley Ho and the Eighth Wonder partnership “a stretch.”

The government of Singapore announced Dec. 8 it was passing over Eighth Wonder and another bidder and selected a consortium headed by Genting International Bhd, a Malayasian casino company.

Analysts studying the three bids for the project before the decision generally marked down Eighth Wonder for its relative lack of experience in developing an entire resort complex.

Such a deficiency might be enough to eliminate Eight Wonder without considering other factors, but even a tenuous tie to Stanley Ho would give Singapore regulators pause, said William Eadington, an economics professor at the University of Nevada, Reno, who has extensively studied casino gaming in Macau.

“There were and probably still are Triad [Chinese organized crime] connections around Stanley Ho,” said Eadington. “I think anything very close to Stanley Ho they [Singaporean regulators] are going to have trouble with.”

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Hold adjusted property EBITDA has grown each month during the third quarter, and we are excited by our continued progress in expanding the business. VIP rolling chip volume has shown excellent growth, progressing from US$1.375 billion in July to over US$2.5 billion for the month of October. Based on our estimation for the month of October, Crown Macau’s combined VIP and mass table game market share of the whole market was approximately 8%, continuing the positive growth trend and despite the introduction of a major new entrant into the market.

“We are very optimistic that we can continue to drive additional improvement at Crown Macau, as a result of our previously announced reconfiguration of the property to accommodate additional VIP capacity with a commensurate reduction in mass market and slot capacity. This reconfiguration reflects the positive reception Crown Macau has received from the market and complements our competitive advantage in the VIP segment driven by our market leading amenities and strong local relationships with junket operators.

“We believe that this reconfiguration will lead to significantly increased gaming activity at Crown Macau and an expansion of our already strong junket network. Our previously announced Gaming Promotion agreement with Ama International Limited has the potential to meaningfully accelerate this process, largely due to the working capital solution this agreement brings to the property. The physical reconfiguration of the property is scheduled for completion by December 1, and, pending satisfaction of certain conditions, we anticipate that full Ama operations will commence at Crown Macau by year end. Final table mix plans for the reconfiguration of Crown Macau is still being finalised. Following completion of the reconfiguration and based on our current plan, Crown Macau is expected to have approximately 187 VIP gaming tables, 57 mass market gaming tables, and 230 gaming machines.”

Company-wide Operating Results

Total revenue, net of rebates paid on rolling chip play, for the third quarter of 2007 was US$113.4 million, up from US$7.3 million in the third quarter of 2006. Results for the third quarter of 2007 include the operations of Crown Macau, which opened on May 12. The year over year revenue increase was driven primarily by the opening of Crown Macau.

Third quarter results also reflect the impact of the acquisition of the gaming sub-concession in September 2006, which resulted in a change in reporting of gaming revenues from the Company’s Mocha Clubs from a service fee basis prior to acquisition of the sub-concession, to gaming revenue based on net win after gaming taxes since the acquisition of the sub-concession.

Total group operating costs and expenses were US$159.7 million in the third quarter of 2007, up from US$16.9 million for the third quarter of 2006. The increase was largely attributable to the opening of Crown Macau and the commencement of amortization of the Company’s gaming sub-concession, increased amortization of land use rights for projects under development, and increased pre-opening, selling and marketing investment costs associated with the development of Crown Macau and City of Dreams. Pre-opening expense for the third quarter of 2007 was US$3.3 million, mainly associated with the final phase of opening of Crown Macau during July 2007.

Total non-operating income for the third quarter of 2007 was US$0.8 million, including US$1.9 million in interest income and US$1.0 million in net foreign exchange losses. Capitalized interest during the third quarter of 2007 was US$2.0 million.

The Company reported a net loss of US$45.2 million for the third quarter of 2007, compared to a net loss of US$7.7 million for the third quarter of 2006. Net loss per share for the third quarter of 2007 was US$0.037, compared to a net loss per share of US$0.015 in the third quarter of 2006.

Crown Macau 3Q Operating Performance

In the third quarter of 2007, net revenue at Crown Macau totaled US$97.6 million. Prior period comparisons are not available.

Adjusted EBITDA(1) at Crown Macau for the third quarter of 2007 was a deficit of US$10.4 million.

Our expected rolling chip table games hold percentage is 2.7%. In the VIP table games segment, rolling chip volume totaled US$4.8 billion for the third quarter of 2007. Actual rolling chip table games hold percentage (calculated before discounts and commissions) was significantly below expectation at 2.3%. Life-to-date of the property through November 13, rolling chip table games hold percentage is slightly below 2.5%.

In the mass market table games segment, drop (non rolling chip) totaled US$99.3 million and table-hold percentage was 17.4%. The expected range for mass market table games hold percentage is 16% - 18%.

Gaming machine handle (volume) was US$67.1 million and gaming machine revenue was US$4.2 million in the third quarter of 2007.

Total non-gaming revenue at Crown Macau in the third quarter was US$8.1 million. Occupancy in the third quarter of 2007 was 51.9% and the average daily rate (ADR) was US$233 per occupied room.

Mocha Clubs 3Q Operating Performance

Gaming revenue from the Company’s Mocha Clubs totaled US$19.8 million in the third quarter of 2007. Revenue for the third quarter of 2006, before the Company had acquired its gaming sub-concession, totaled US$5.7 million in the form of service fees received under the terms of a revenue-sharing service agreement with SJM, where the revenue share was calculated as 50% of net gaming revenues after deduction of Macau gaming tax at 39% of gross gaming revenue. On a pro forma basis (which assumes that the Mocha Clubs had operated under an owned gaming sub-concession during the third quarter of 2006), gaming revenue from the Mocha Clubs was essentially flat year-over-year, despite a reduction in the average number of gaming machines in service in third quarter 2007 as compared with third quarter 2006.

Mocha generated US$5.9 million of adjusted EBITDA(1) in the third quarter of 2007, which compares with US$1.1 million in the third quarter of 2006.

The Company’s seventh Mocha Club opened on October 3, 2007 at Mocha Square, a prime location in central Macau. It added approximately 130 gaming machines to our total existing installed base of gaming machines at Mocha Clubs. Additionally, the first phase of a two phase expansion of an existing facility at Hotel Royal opened in November and phase two is expected to open in January 2008. Taking into consideration both of these developments, Mocha Clubs is expected to have over 1,250 gaming machines by the end of January 2008.

In the third quarter of 2007, the number of gaming machines in operation at the Mocha Clubs averaged approximately 980 in six locations versus 1,015 in the third quarter of 2006. Average net win per gaming machine per day increased by 4.3% to US$220 from US$211 as compared with the same period last year. Over the same period, the total number of gaming machines in the Macau market as a whole more than doubled on a year-over-year basis.

Nine Month Results

For the nine month period ending September 30, 2007, the Company reported revenue of US$178.8 million versus US$18.2 million in the nine month period ending September 30, 2006. The year over year revenue increase was driven primarily by the opening of Crown Macau.

The Company reported a net loss of US$141.6 million for the nine month period ending September 30, 2007, compared with a net loss of US$20.5 million for the nine months ending September 30, 2006. The net loss per share for the first nine months of 2007 was US$0.117, compared to a net loss per share of US$0.041 for the year ago period.

City of Dreams Update

City of Dreams is on budget and remains targeted for opening by the end of March 2009. The initial phase opening will include substantially all of the 420,000 square foot casino and approximately 145,000 square feet of retail space, as well as the 370-room Hard Rock Hotel and Crown Towers Hotel, Cotai, with approximately 300 rooms, suites and villas.

The 1,000-room Grand Hyatt Macau hotel is scheduled to open in September 2009, and the 2,000-seat Theatre of Dreams is scheduled for completion in the first quarter of 2009. Opening night is expected before year-end 2009 following four to six months of rehearsals. The approximately 800 unit apartment hotel complex integrated within the City of Dreams footprint is expected to be completed by December 2009 and to be marketed in advance of project completion, subject to compliance with legal and regulatory provisions.

The main podium superstructure works are now over 84% complete and roughly 40% of the hard costs associated with the project have been let to contractors. The Hard Rock hotel tower and Crown Towers hotel tower construction works have both progressed to the 9th floor.

Macau Peninsula Project Update

The Company continues to review and develop its plans for development of the Macau Peninsula project. Those plans are subject to completing the acquisition of the site and certain conditions including meeting applicable Macau regulatory requirements.

Financial Position and Capital Expenditure

Cash and cash equivalents as of September 30, 2007, including restricted cash, totaled US$599.1 million. Total outstanding debt at the end of the third quarter was US$614.3 million, consisting of US$500 million from the draw down of the first tranche of our US$1.75 billion bank facility and US$114.3 million in loans from the Company’s two major shareholders. Total debt to shareholders’ equity ratio as of September 30, 2007 was 32%.

The Company priced its follow-on public offering at US$15.50 per ADS following market close on Wednesday, October 31. The offering comprised a public offering of 37,500,000 ADSs representing 112,500,000 ordinary shares with each ADS representing three ordinary shares of Melco PBL Entertainment. The Company raised roughly US$580 million in proceeds from this financing before fees.

Capital expenditure for the third quarter 2007 was US$163.6 million, bringing capital expenditure to US$560.2 million for the nine months ending September 30, 2007. Third quarter capital expenditure consisted of US$2.0 million for Crown Macau and US$157.5 million for City of Dreams. Total capital expenditure for City of Dreams in the first nine months of 2007 amounted to US$339.6 million.

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Land Concession
Our subsidiaries Melco PBL (COD) Developments Limited (“MPBL (COD) Developments”) and Melco PBL Gaming (Macau) Limited (“MPBL Gaming”) recently received an offer letter from the Land, Public Works and Transport Bureau (“DSSOPT”) of the Macau Special Administrative Region of the People’s Republic of China (“Macau SAR”) for a land lease agreement to be entered into with the Macau SAR for the two adjacent land parcels on Cotai that comprise the City of Dreams site.

This offer letter defines the premium and payment schedule for the City of Dreams site and specifies the development rights associated with the land concession. Our subsidiaries MPBL (COD) Developments and MPBL Gaming accepted the terms of the offer on November 6, 2007.

Upon the receipt of requisite approvals, our subsidiary MPBL (COD) Developments will make its first scheduled land premium payment, and following the gazetting of the land concession, the land grant process will be complete. We do not have a committed timetable for the completion of these final steps.

Program and Budget Update
Construction of City of Dreams on Cotai remains on time and on budget. The development budget remains in-line with our June 15, 2007 announcement that provided an update on the timing and scope of the project. At that time, MPEL indicated that the direct cost of the construction of City of Dreams, excluding the co-located apartment hotel tower, would be US$1.85 billion and that the cost of the land would be US$279 million – these costs remain unchanged.

Our US$1.75 billion bank facility, when fully drawn, is intended to fully fund the budgeted construction costs of City of Dreams resort and casino. The drawdown of the balance of the financing remains subject to the fulfillment of certain conditions precedent.

The cost of development of our apartment hotel complex on the site of the City of Dreams casino and resort development will be financed from funds drawn from outside of the bank lending facility. This provides us with significantly improved flexibility in the application of the proceeds generated from the planned monetization of the apartment hotel. Our recently completed equity offering has, among other uses of proceeds, secured the funding to complete the construction of the apartment hotel complex on Cotai, the estimated cost of which remains essentially unchanged at US$330 million.

Commenting on this status update for City of Dreams, Mr. Lawrence Ho, Co-Chairman and CEO of Melco PBL Entertainment, stated, “Our City of Dreams casino and resort will set a new benchmark for a “must-see” destination in Asia. The rapid pace of construction progress on site is exhilarating. Full praise is due to the efficiency and professionalism of the Macau government, the DSSOPT and our managing contractor and work site personnel.”

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By now James Packer must surely call this the ‘City of Nightmares’.

The new costs for the casino/hotel project, now under construction, are given in a 190-page filing to the US Securities and Exchange Commission by the US-listed Melco PBL Entertainment, which is seeking to raise $US563.8 million in new shares.

Packer’s Macau casino business is being undertaken as a joint venture with the Hong Kong-listed Melco, run by Lawrence Ho, son of Macau casino veteran Stanley Ho.

The latest SEC filing, made this week, estimates the City of Dreams casino project, which is now being built by the Leighton group, will cost $US2.1 billion excluding the cost of the land. This is in addition to the $US330 million cost of an apartment hotel project which it also plans for the site.

In June, Melco PBL announced a City of Dreams “project review” which put the cost at $US1.85 billion — 23 per cent higher than the estimated $US1.5 billion in the prospectus issued late last year when the company listed on the US market.

The cost of the project, on Macau’s Cotai strip, has been hit by a combination of design changes and higher construction costs.

This week’s SEC filing says the apartment hotel complex will involve 800 apartments compared to 650 units in the June announcement — itself an expansion of previous plans.

The SEC filing also reveals that Melco PBL still has not reached an agreement with the Macau Government over the cost of the land. “We are developing City of Dreams on land for which we have not yet been granted a … concession by the Macau Government on terms acceptable to us,” it says.

“If we do not obtain a land concession on terms accessible to us, we could forfeit all, or part of, our investment in the site and the design and construction of the City of Dreams and would not be able to open and operate that facility as planned.”

The filing also notes the joint venture partners have also yet to receive approval from the Government on their plans to expand the gross floor area of the site.

The first phase, which includes the casino, retail space and two hotels, is set to open by the end of March 2009. But this week’s filing warns potential investors that the current plans may face further cost blowouts and delays.

The partners opened their first casino/hotel project in Macau, the smaller Crown Macau pitched at VIP gamblers, in May, although it was not fully operational until July. The prospectus says revenues from the Crown Macau rose in July and August but were hit in September by “a substantial fall in the hold rate” on its VIP gaming operations.

Source: The Australian

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