Asian casino operator Donaco International Limited has reportedly released its financial results for the twelve months to the end of June showing that its annual loss had widened by 55.8% year-on-year to hit nearly $130.88 million as a result of some $134.99 million in non-cash impairment charges.
According to a report from GGRAsia, the Sydney-listed firm used an official filing to detail that the impairment charges included a $125.86 million setback related to the value of the casino license for its Star Vegas Resort and Club property after the owner of the Cambodian venue’s land attempted to terminate its 50-year lease, which is a matter that remains the subject of litigation.
Donaco International Limited reportedly explained that its underlying net profit after tax for the twelve-month period had reached approximately $6.19 million despite the impairment penalties although this nevertheless represented a year-on-year decline of 49.7%. To make matters worse, the filing also purportedly showed that the Australian firm’s overall annual revenues had fallen by 6.8% to hit approximately $58.21 million while its earnings before interest, tax, depreciation and amortization were 30.2% lower at around $19.96 million.
The Sydney-headquartered operator reportedly stated that rising competition in the Cambodian casino market had pushed overall annual revenues for its Star Vegas Resort and Club down by a little over 2.8% year-on-year to slightly above $43.64 million as the venue’s net gaming revenues tumbled by 9.9%. To make matters worse, the firm purportedly moreover declared that the facility located in the border town of Poipet had been impacted by ‘unfavorable’ junket deals inked by former members of its management team although it was now in the process of renegotiating some of these arrangements.
Donaco International Limited reportedly proclaimed that its Star Vegas Resort and Club had nonetheless welcomed more visitors than in the previous year and saw its comparable VIP turnover swell by 76% ‘due to full-year impact of junkets brought in to replace those poached by the Thai vendor in fiscal year 2018’.
For its gaming operation inside northern Vietnam’s Aristo International Hotel, the operator reportedly pronounced that annual revenues had plummeted by 16.6% year-on-year to around $14.57 million as its VIP business suffered a 54% setback ‘due to [a] weak start to the year’. But, the firm purportedly affirmed that this enterprise had ‘recovered in [the] second half’ and posted a full-year win rate that was 0.18 percentage points higher than the previous twelve-month period at 2.09%.
GGRAsia reported that Donaco International Limited subsequently used a second filing to detail a number of operational and management changes including the recent appointment of Paul Arbuckle as its new Chief Executive Officer. The firm purportedly declared that this move will enable it to make a ‘fresh start’ following the removal from its board in July of a pair founding members in Joey Lim Keong Yew and Ben Lim Keong Hoe, who were the grandsons of Genting Malaysia Berhad founder Lim Goh Tong.
Donaco International Limited reportedly moreover used this subsequent presentation to state that its most recent full-year results had reflected a ‘lack of effective management and leadership under [the] former executive team’ but that its new senior leadership had made ‘an immediate positive impact’ as July results from both of its operations had ‘significantly improved’.