Cambodian and Vietnamese casino operator Donaco International Limited has announced stable financial results for the third quarter, as dips in Cambodia were leveled by operations in Vietnam.
The group reported net revenue of AU$10.25 million ($6.8 million), a slight decrease from AU$10.81 million ($7.1 million) in the June quarter. Earnings before interest, taxation, depreciation, and amortization (EBITDA) also dipped to AU$5.55 million ($3.7 million) from AU$6.34 million ($4.2 million) in the previous quarter.
The downturn in revenue was primarily attributed to lower-than-expected performance at the DNA Star Vegas operation, located on the Cambodia-Thailand border. This was impacted by approximately AU$ 0.37 million ($0.24 million) in registration fees for new slot machines introduced in September.
At Star Vegas, net revenue fell to AU$6.30 million ($4.2 million) from AU$6.84 million ($4.5 million) in the June quarter, while property-level EBITDA decreased to AU$3.83 million from AU$4.65 million ($3.1 million). Average daily visitation remained stable at 941 players, buoyed by the company’s membership loyalty program launched earlier this year.
In contrast, The Aristo International Hotel in Vietnam demonstrated stable revenue, reporting a net income of AU$3.95 million ($2.6 million), nearly unchanged from AU$3.97 million ($2.6 million) in the previous quarter. Daily visitation slightly increased to 306 players, up from 291, with property-level EBITDA rising to AU$2.52 million ($1.7 million) from AU$2.47 million ($1.6 million).
As of the end of the September quarter, Donaco’s cash position improved to AU$33.02 million ($21.8 million), up from AU$29.30 million ($19.4 million) in June. The company reported payments to related parties totaling AU$195,000 ($128,817) for salaries and contracted services.
Non-Executive Chairman Porntat Amatavivadhana commented on the results, highlighting that both operations performed in line with expectations despite the challenges faced by Star Vegas.
He reiterated the company’s commitment to navigating the evolving gaming industry in Southeast Asia and mentioned ongoing evaluations of potential disruptors, including Thailand’s proposed Integrated Entertainment Business Act, which aims to legalize casinos within entertainment complexes.
The proposed legislation could significantly affect Donaco’s operations and cross-border tourism, as many patrons of DNA Star Vegas come from Thailand. Donaco is closely monitoring the situation, although there are currently no immediate impacts on its financials.
Continued legal action over tax on floating chips
Additionally, Donaco is pursuing legal action against Vietnam’s General Department of Taxation (GDT) after the agency denied Aristo’s appeal regarding tax on floating chips. In October, the company was granted permission to initiate proceedings challenging the GDT’s decision, with an update on the case expected in due course. Should the GDT’s ruling not be overturned, it could pose a potential liability of approximately AU$8,86 million ($5.9 million).
Looking ahead, Donaco anticipates that the construction of Sapa Airport in Lao Cai, set to open in 2025 with a capacity of 1.5 million annual passengers, will bolster tourism to the region where Aristo is located.
