Donaco International said it swung to a profit in the September quarter, helped by a strong performance from its property in Vietnam and reduced costs.
Group revenue gained 42 percent to A$24.25 million from the prior year, while net profit after tax was $3.81 million compared with a loss of $1.76 million. Corporate costs were down by 19 percent, the company said in a filing to the Australian Stock Exchange.
Donaco operates the Aristo International in the far north of Vietnam and the Star Vegas in the Poipet area of Cambodia.
At the Aristo, revenue was up 164 percent to $4.99 million, while EBITDA surged to $3 million from $0.19 million. Donaco said its Vietnam performance in the prior-year period had been “unusually weak.”
At Star Vegas, revenue gained 3 percent to THB357.8 million, while EBITDA was up 7 percent.
During the September 2019 quarter, the new management team at Star Vegas began rationalising the VIP junket arrangements, with a focus on eliminating poor quality business practices, and improving margins, the company said.
Accordingly, while VIP turnover declined due to the departure of unprofitable junkets, net revenue increased.
Operating expenses at the property rose slightly to THB229.6 million from THB227.8 million due to legal costs related to an ongoing dispute with the former Thai owner of the property and on diesel costs for back-up generators due to national outages.
“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 said in its results statement.