Donaco doesn’t plan to sell properties despite financial challenges
Australian-listed casino operator Donaco International said it is not planning to sell any of its casinos, despite the challenges inflicted on the company from the coronavirus pandemic.
Gambling Insider reports that the group owns several venues, including in Vietnam and Cambodia, with the Aristo International Hotel and Star Vegas Resort and Club among their holdings.
Donaco owns a 95 per cent interest in its Vietnamese casino business as a joint venture with the government and it has stated it is not considering selling Aristo at this stage, despite the fall of stock value, opting to wait until the situation stabilises once borders open because the group sees great potential in the casino.
In a recent question and answer session, chief executive Lee Bug Huy and chief financial officer Gordon Lo said that while both Aristo and Star Vegas continue to be impacted by the pandemic, the group “will continue to execute on the strategic initiatives implemented in the first six months, while keeping tight control over costs.”
The group doesn’t see anything that could potentially affect their recovery.
The executives noted the vaccination progress should provide more stability, despite how long recovery might take.
“At this stage, ew do not expect the Thai government to legalise gambling in the country,” Donaco executive said, when asked if the group had a plan in place to mitigate the financial risk in case Thailand legalises gambling.
“As we weather the impacts of COVID-19, we will carry on our rigorous cost control strategy and prepare for when the border reopens.”
They added a positive long-term outlook should outweigh the short-term losses. The group remains optimistic about the future of their casinos.
“We did everything we could during the first half to fix what had to be fixed internally, and we are now ready to move forward once the pandemic’s situation improves.”
Donaco settles Star Vegas dispute
Australian casino operator Donaco International has confirmed the conclusion of its dispute with Cambodia’s Star Vegas Casino.
Yahoo Finance reported in February that the dispute, originally announced on March 3, 2020, has concluded.
The accounts for the six months ending December 31, 2020 will fully reflect the positive outcome in accordance with the terms of the settlement, the report said.
In addition, as detailed on December 18, 2020, the business has continued to improve to a positive EBITDA as impacts from coronavirus have moderated from earlier extreme levels.
The company’s debt has been reduced significantly and a solid platform for growth is now emerging, it said.
Donaco’s largest business, Poipet’s Star Vegas Casino and Resort, on the Thai-Cambodia border, was established in 1999 and is the largest and highest quality of the Poipet hotel casinos.
The property has more than 100 gaming tables, more than 1400 pokie machines and 385 hotel rooms.
Donaco’s flagship business is the Aristo International Hotel, a successful boutique casino in northern Vietnam, located on the border with Yunnan Province, China.
Established in 2002, the property has recently been expanded to a brand new five star resort complex with 400 hotel rooms.
Donaco owns a 95 per cent interest in the business, in a joint venture with the Vietnamese government.
Donaco settles case with Star Vegas casino
Australian-headquartered casino operator Donaco International has gained approval from a key lender to settle the casino firm’s legal cases with third parties, including its Cambodian casino venue.
GGR Asia reported in December that an outstanding debt of US$7.8 million payable to Mega Bank was a “notable reduction from the initially borrowed amount of US$100 million and the company is on track to repay all the remaining debt in financial year 2021,” Donaco said in a filing to the Australian Stock Exchange.
The approval by Mega Bank was in relation to the “successful settlement of all legal cases with the Thai-vendor” parties regarding Star Vegas and was “part of the provisions of a facility agreement with the lender,” Donaco noted.
“Donaco is extremely pleased to secure this approval as the company continues to work with Mega Bank and pay down the debt facility under the agreement,” it said.
The firm further noted that interest cover and debt ratio covenants were “not required to be tested” as of December 31 and would only be tested as of June 30, 2021, the end of the current financial year.