On September 19, Donaco International announced that Chief Executive Officer Paul Arbuckle and Executive Director Ben Reichel opted to purchase additional shares in the company. This, according to many insiders, is proof that the executives are showing their confidence in the future of the company by increasing their personal holdings.
In the filing with the Australian Stock exchange (ASX), it was revealed that Arbuckle had purchased nearly 167,000 shares while Reichel increased his holdings by nearly 170,000 shares. This increased the executive director’s total holdings to over 880,000 shares of the company’s stock.
This move comes almost exactly one month after there was a shakeup with the executive board at Donaco International. In July, the Lim Brothers, Joey Lim Keong Yew, and Ben Lim Keong Hoe, were forced off the board of directors. The two brothers were founders at Donaco.
With two positions available, the company added Leo Chan Yan Ho and Kurkye Wong. Both came with impeccable credentials as Chan was the executive director at Argyle Street Management and Wong was the company vice president there.
While Reichel has been a longtime director at the company, Arbuckle has only been in his position as CEO since June. That he has increased his investment is perceived as a sign to investors that they should have confidence in Donaco.
This comes after a report in late August that the company may take a lot longer to recover than expected. Because of the huge challenges the company has been facing with their casino operations in Cambodia, specifically related to the Star Vegas Resort and Club, it is expected that they will be facing a much wider loss for shareholders them what was first proposed.
The most recent fiscal year, concluding on June 30, found that the losses neared $131 million. That was 55.8% bigger than what was expected. This comes amid a growing legal battle between Donaco and Lee Hoe Property, the management company that owns the land where the casino resides.
With these kinds of troubles, it would’ve been easy for the executives to stand pat. However, their willingness to increase their shares in the company is a sign to many that they expect a significant turnaround at Donaco. There may not be much evidence to support that conclusion, but their willingness to increase their shares may be all the evidence that those looking for a good investment need to see.
