Asian casino operator Donaco International Limited has released its financial results for the six months to the end of December showing that its half-year gross revenues had decreased by over 14% year-on-year to stand at $45.34 million.
Sydney-listed Donaco International Limited operates the Aristo International Hotel in northern Vietnam along with Cambodia’s Star Vegas Resort And Club property and stated that group earnings before interest, tax, depreciation and amortization for the six-month period declined by almost 15% year-on-year to $25.59 million although its net profit after tax rose by 4.9% to $11.37 million.
“Our group net profit after tax for the six months was up on the prior period to $11.37 million but operationally the results were mixed with a strong result from the Aristo International Hotel and weaker performance from the Star Vegas Resort And Casino, which was impacted by tough trading conditions in the period,” read a statement from Joey Lim, Chief Executive Officer for Donaco International Limited. “The strengthening of the Australian dollar against the Thai baht and the Chinese renminbi also had a negative impact on the results reported in Australian dollars after currency conversion.”
In terms of its Aristo International Hotel, which lies only 2.4 miles from Vietnam’s border with China, Donaco International Limited reported that net gaming revenues for the six-month period had increased by 11.9% year on year to $6.27 million while non-gaming takings improved 20.6% to $3.82 million. Similarly, the border venue’s half-year earnings before interest, tax, depreciation and amortization swelled by 19% to $6.2 million with a VIP gross win rate at over one percentage point higher at 3.18%.
“At the Aristo International Hotel it was pleasing to see the strong improvements in venue performance following management actions to focus on the main floor and away from the VIP segment of the market,” read the statement from Lim. “Accordingly while our VIP turnover was down 23%, our overall local currency revenues increased by 15% and earnings before interest, tax, depreciation and amortization improved by almost 20%.”
However, Lim proclaimed that the Star Vegas Resorts And Casino had faced “difficult trading conditions” due to a weakening in the Thai economy and diminished consumer sentiment following the death of King Bhumibol Adulyadej in October. The Poipet development saw its six-month net gaming revenues plummet by 16.2% year-on-year to $32.46 million with takings from non-gaming activities down by 9.4% to $1.96 million. Earnings before interest, tax, depreciation and amortization at the border venue lessened by 17% to $23.04 million while its VIP gross win rate fell by 0.26 percentage points to 2.75%.
“We also had one less VIP event in the period while other events were cancelled due to the late King’s passing, [which led] to a reduction in patronage and turnover during the period,” read the statement from Lim. “The normalized earnings before interest, tax, depreciation and amortization was down slightly by 1.7% as the previous period had an above theoretical win rate compared to a slightly below theoretical win rate in the current period. In recent weeks we have had an improving trend in turnover, which is starting to return to more normal levels and improved performance is expected in the second half.”