Casino operator Donaco International says its Cambodian casino is firing on all cylinders while its Vietnamese property continues to battle overly lucky VIPs.
The Australian-listed Donaco’s financial year ended June 30 but the company filed papers on Monday with the Australian Securities Exchange that offered insights into its performance in the “September quarter,” aka the three months ending Sept. 30.
Donaco says business at its new Star Vegas Resort and Club in Poipet, Cambodia was “pleasing, and the business is on track.” Donaco officially took control of Star Vegas in July after striking a deal this January to purchase the casino – considered the swankiest of Poipet’s nine gaming venues – for $360m.
Donaco said Star Vegas’ VIP table game turnover came to AUD 1.3b (US $943m) during the quarter, a 43% year-on-year improvement. The gains are all the more impressive given that the three-year deal Donaco struck with the Heng Sheng Group junket operator to steer VIPs to Star Vegas didn’t take effect until the last 10 days of September, and Donaco postponed much of its marketing activity in the quarter due to management’s focus on getting the Heng Sheng room ready.
VIP table game revenue came to just under A$44m while mass market tables added A$6.1m. After paying A$29.5m in junket commissions, net table game revenue at Star Vegas came to A$20.6m. Electronic gaming machines contributed A$10.3m while non-gaming revenue contributed a mere A$630k. Overall, revenue was up 12% while the property’s earnings for the quarter came to A$25m, up 29% year-on-year.
Traffic was up significantly as at Donaco’s original flagship property, the Aristo International Hotel in Vietnam’s northern Lao Cai province. Visitation was up 79% and 61% in August and September, respectively, and the property’s quarterly revenue rose 19% year-on-year to A$4.6m. Total net gaming revenue was A$2.6m, only slightly more than the A$2m contributed by Aristo’s non-gaming offerings.
Aristo’s VIP table turnover was flat year-on-year, but win rate improved from 1.24% last year to 1.76% this quarter. Both numbers are well below theoretical win rates and management took steps to address this shortfall by lowering table limits, which it believes will help attract more minnows than whales and reduce exposure to the VIP luck factor.