Donaco narrows losses as revenues drop 38%

The firm says it is confident finances will pick up when borders reopen.
The firm says it is confident finances will pick up when borders reopen.

The Australian operator’s casino in Vietnam is running limited operations and its casino in Cambodia remains closed.

Australia.- Casino operator Donaco International has announced that in the full fiscal year 2020 it narrowed its losses to AU$58.95 million (US$43.4 million), down from AU$198 million (US$146 million) in FY19.

However, revenues for the year was AU$53.49 million (US$39.4 million), down 38 per cent on the previous year.

EBITDA totalled AU$10.34 million (US$7.6 million), with 7 per cent growth during the first half before the impact of the Covid-19 pandemic.

Donaco’s Vietnam casino Aristo reopened on May 8 and is set to continue with limited operations at management discretion for at least the short-term future while the border with China remains closed.

Star Vegas in Cambodia, meanwhile, remains closed, while the Cambodia-Thailand border is also closed.

In both cases, Donaco has given local management discretion to continue operations as they see fit under local conditions.

The firm said in a release: “The two casinos are ready to ramp up to higher patron capacity when the situation ameliorates which will likely occur when borders reopen, and once cross border travel flows recommence.”

The company stressed that it has implemented cost control measures, obtained refinancing from its main lender Mega Bank, and successfully raised AU$14.41 million (US$10.6 million) to provide immediate capital relief.

Non-executive Chairman Mel Ashton said: “Covid-19 has presented significant challenges for Donaco, as it has for the vast majority of businesses which have a large customer base of international travellers, and this is reflected in our FY20 results.

“However, we have pragmatically reduced our operating costs substantially, and have received the support of our primary lender being able to strengthen our balance sheet.

“This has enabled us to maximise the preservation of shareholder value during this challenging and volatile period. Our two casinos are set to operate on a limited basis for at least the short term, until the situation is normalised.”

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