An affiliate of Macau casino junket operator Suncity Group has warned shareholders of “significant” losses over the first half of 2018.
On Friday, Suncity Group Holdings Ltd informed the Hong Kong Stock Exchange that a preliminary review of its unaudited results for the six months ending June 30 had led the company to expect “a significant increase” in its H1 losses compared to the same period last year, when the company lost RMB1.06b (US$154.6m).
The company won’t release its final H1 results until August 27, but it says the expected fiscal plunge was “mainly attributable to the increase in loss of approximately RMB944.1m ($137.7m) in respect of the change in fair value of derivative component of convertible bond.”
Suncity Group Holdings is a separate entity from the privately held Suncity Group, which is considered Macau’s dominant junket operator. But both entities are linked via Suncity chairman Alvin Chau (pictured), who recently claimed that his company controls over 40% of Macau’s VIP gambling market and handles rolling chip turnover of over $19.2b per month.
Suncity Group Holdings is looking to expand into casino operations via its 34% stake in the Hoiana integrated resort project in Vietnam’s Quang Nam province. The project is a joint venture between Suncity, Hong Kong conglomerate Chow Tai Fook Enterprises and local real estate and development firm VinaCapital.
However, earlier this month, Suncity Group announced the latest delay in closing that deal, pushing the most recently missed deadline back another month until August 31 as the company waits for the project’s developer to secure bank approval to press forward.
Suncity is reportedly eyeing casino operator opportunities in other Asia-Pacific markets, including South Korea, the Philippines, Russia and Myanmar. The switch is part of the company’s strategy of adopting a ‘pure gaming’ model by 2020.