Australia-listed Donaco International will be placing a stronger emphasis on controlling costs and expenses after weak June quarter results due to the continued impact of Covid-19 travel restrictions on the company’s operations.
The company posted a 95.6 percent fall in revenue in the June 2020 quarter, reaching A$0.9 million. Operating expenses reached $2.6 million.
DNA Star Vegas, located in Cambodia, has been closed since April 1, according to the company. Net revenue has come in at US$0.2 million, whilst operating expenses is at US$1.1 million.
Its Vietnam property, Aristo, whilst it has reopened, has been operating on a limited basis as the border with China remains closed. Average daily visitation is 14 players. Rolling chip VIP turnover reached $34 million, net revenue reached 0.4 million whilst operating expenses are at around $0.6 million.
“The June quarter was significantly impacted by the onset of Covid-19 and the restaurant restrictions on casino operations and border closures. The closure of both DNA Star Vegas and Aristo International Hotel for an extended period of time has had a material impact on Donaco’s operations,” said the company in a filing to the Australian Stock Exchange on Friday.
Donaco said it will turn its attention to cost control amid the continued impact from the coronavirus.
“As a result of the shutdowns, Donaco has placed heavy emphasis on tightly controlling and reducing costs and capital expenses to ensure the Company’s sustainability into the future.”
Donaco said it has set a monthly target cash burn rate of approximately US$800,000 to $900,000.
“We have taken pragmatic measures to adopt a cost control strategy at both casinos as Donaco continues to be impacted by Covid-19 travel restrictions,” said chairman Mel Ashton.
The company filing also makes note that Donaco CEO Paul Arbuckle will be stepping down from August 4, 2020.
Arbuckle’s departure was first announced in December 2019, but the company had kept him on until a suitable replacement was found. Donaco said the recruitment process for its next CEO is ongoing.