A difficult 18 months has shown signs of easing for ASX-listed Donaco International Ltd with the company reporting significant increases in revenue and Group EBITDA thanks to strong growth at Vietnamese casino Aristo.
Donaco, whose operations have been hampered by ongoing legal disputes with the former vendors of its Star Vegas property in Cambodia and sweeping changes to its board and ownership, saw revenues rise 42% to AU$24.3 million and Group EBITDA by 167% to AU$8.9 million.
Aristo, which suffered from the absence of VIP players in 2018 due to a Chinese crime syndicate threatening players as they tried to cross the border from China, saw its revenues jump 164% to US$5 million and EBITDA by 1,163% to US$3 million following a very weak performance in 3Q18.
Star Vegas showed more moderate improvement with revenue up 3% to THB357.8 million, with a high win rate boosting results after VIP turnover declined 38.9% to THB12.1 billion. Donaco said the reduced turnover was in part due to the casino’s new management team beginning rationalization of its VIP junket arrangements to eliminate poor quality business practices and improve margins.
On the improved group-wide results, Donaco said, “The increase in revenues is pleasing given that the September quarter is traditionally not a particularly busy quarter for either of the Company’s casino properties. The public holiday calendar in Cambodia and Vietnam tends to skew the results towards the June half year.
“The new management team led by CEO Paul Arbuckle has just begun to implement improvements in operating procedures, which are expected to generate further improvements in results in future periods.”
Donaco reported a net profit after tax of AU$3.8 million for the quarter, compared with a loss of AU$1.8 million in the prior year period.
