Core Viewpoint - CICC has downgraded the EBITDA forecast for KJC Holdings (03918) for 2025 by 25% to $329 million, while introducing a 2026 EBITDA forecast of $393 million, reflecting a longer recovery period for the gaming business [1] Group 1: Financial Performance - KJC Holdings reported total gaming revenue of $171 million for Q1 2025, representing an 18% year-on-year increase and recovering to 53% of Q1 2019 levels [2] - The mass gaming revenue led the recovery with a 24% year-on-year increase, reaching 120% of Q1 2019 levels, while VIP gaming revenue increased by 17% but only recovered to 29% of Q1 2019 levels [2] - The net gaming revenue for Q1 2025 has recovered to 92% of Q1 2019 levels, amounting to $148 million, attributed to the increasing share of high-margin mass gaming revenue [2] Group 2: Market Trends - The number of travelers to Cambodia is expected to increase, with total arrivals in February 2025 reaching 109% of the same period in 2019, and Chinese travelers at 49% [3] - The increase in direct flights to Cambodia and the upcoming opening of the new airport in Phnom Penh in July 2025 are anticipated to further boost traveler numbers, positively impacting the mass gaming business [3] Group 3: Dividend Outlook - The management plans to resume dividend payments in 2025, although the amount may be influenced by capital expenditures related to the Naga 3 construction project and NagaWorld renovations [4] - The projected capital expenditure for 2025 is approximately $70 million, primarily for renovations and upgrades to gaming systems at NagaWorld [4] - The estimated free cash flow for 2024 is around $96 million, leading to an expected dividend payout ratio of 60% in 2025 [4]