Donaco International Ltd., the Australia-listed casino operator, had a good first quarter this 2019. In a filing with the Australian Securities Exchange (ASX) last Friday, the company said that its net revenue increased to US$17.2 million in the period, an increase of about 7.2% over the same quarter last year when it took in around $$16.86 million.
Donaco operates the Star Vegas Resort and Club in the Cambodian city of Poipet, which is popular with gamblers from Thailand. It also operates Vietnam’s Aristo International Hotel, a venue that attracts mainly Chinese mainlanders. Neither Thailand nor mainland China have legal casinos.
For the quarter, Star Vegas saw its net revenue increase to $13.74 million from $13.69 million a year ago. At the same time, though, its EBITDA dropped from $8.29 million to $6.19 million.
According to Donaco’s filing, “Higher gross gaming revenue from table games was offset by higher junket commissions and profit-sharing costs, and lower slot-machine revenue.” In addition, VIP turnover at the venue “increased during the March 2019 quarter to [$636 million], compared to [$580 million] in March 2018, driven by the addition of new junket groups as management rebuilt the VIP gaming business.”
Aristo saw things slide a little in the quarter. Its net revenue dipped from $4.6 million to $4.5 million; however, EBITDA remained unchanged at $2.3 million. The change was a result of tighter cost controls and Donaco added, The Aristo business recorded a lower rolling chip turnover of US$294.1 million over the March 2019 quarter, compared to US$368.1 million in the March 2018 quarter, as management continued to rebuild the VIP business. Junket commissions were reduced by 40 percent.”
Donaco is still engaged in a battle with a number of Thai businessmen with which it used to do business at the Star Vegas resort. Those individuals are reportedly operating competing casinos in violation of a signed non-compete agreement and Donaco is fighting them in several jurisdictions.