Australian-listed casino operator Donaco International Ltd saw its gaming revenues head north again in the three months to 31 March 2019, however the impact on EBITDA was negated due to legal costs relating to the company’s ongoing legal dispute with its former partners at Cambodian resort Star Vegas.
Donaco recorded group revenue of AU$25.5 million (US$18 million) in 1Q19, up from AU$23.65 million 12 months earlier, with VIP turnover and win rate at Star Vegas both improved at THB20.3 billion (US$636 million) and 3.37% respectively.
But Group EBITDA fell slightly, from AU$11.03 million to AU$10.82 million, with Donaco explaining that, “Operating expenses increased to THB242.1 million (US$7.6 million) during the March 2019 quarter, versus THB172.5 million in the pcp, due to higher legal costs caused by the dispute with the Thai vendor, and higher staff costs due to increased headcount and the impact of competition in the Poipet area.”
Property level EBITDA at Star Vegas fell from THB264.6 million in 1Q18 to THB197.6 million.
By comparison, Donaco’s Vietnam property Aristo International Hotel held steady for the quarter, with a decline in VIP turnover offset by reduced corporate expenses. As a result, revenue was US$4.5 million compared to US$4.6 million last year, with property level EBITDA at US$2.3 million in both periods.
Donaco said it was eyeing improved revenue from its online gaming business in the back half of 2019, with its online operations being relaunched with a new software platform and new marketing partners from May.
However, a much-needed strategic review of the company, originally due for completion in March, has been “delayed by shareholder matters, specifically the appointment of receivers over the shares formerly held by the Lim family.”
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