For the quarter ended June 30, 2024, Donaco International reported notable financial outcomes, revealing both impressive growth and some challenges. The group’s net revenue reached AU$10.81 million (US$7.09 million), marking a significant year-on-year increase of 57.1%. However, this represents a decrease from the AU$12.66 million achieved in the previous March quarter.
In terms of EBITDA, Donaco saw a substantial rise of 164.2%, reaching AU$6.34 million compared to the same quarter last year. Despite this impressive growth, EBITDA for the June quarter fell short of the AU$8.39 million recorded in March.
VIP Win Rate Impact
The decline in group earnings and EBITDA for the June quarter compared to March is attributed to a higher-than-expected VIP win rate at the DNA Star Vegas. In June, the VIP win rate was notably high at 10.82%, a significant increase from 4.27% in the March quarter. This variation in the VIP win rate directly impacted the financial performance, illustrating the volatility that can affect casino operations and revenue.
Revenue and Visitation Trends
Despite the decrease in net revenue and EBITDA compared to the previous quarter, Donaco’s operations showed positive trends in visitation. Average daily visitation across both operations increased in the June quarter, reflecting higher engagement with both the DNA Star Vegas and the Aristo International Hotel. Year-on-year comparisons also revealed growth in net revenue for both properties.
DNA Star Vegas
The DNA Star Vegas experienced stabilised property-level EBITDA and net revenue figures during the June quarter. However, the elevated VIP win rate created a financial challenge. Donaco’s turnaround strategy effectively managed operating expenses, mitigating some of the negative impacts caused by the increased VIP win rate.
Aristo International Hotel
The Aristo International Hotel maintained high visitation levels similar to those in the March quarter. This stability in visitation contributed to an increase in net revenue. Nonetheless, a minor surge in operating expenses negatively affected the property’s EBITDA. Donaco remains optimistic about Aristo’s future, particularly with the anticipated opening of the new Sapa airport in 2025, which is expected to bolster the hotel’s performance.
Chairman’s Remarks
Non-Executive Chairman Porntat Amatavivadhana highlighted the company’s stable operational performance and focus on enhancing customer experience. The Chairman underscored the robustness of visitation numbers and the stability achieved across Donaco’s operations. Despite the financial challenges presented by the VIP win rate and increased operating expenses, Donaco’s strategic initiatives and improvements in visitation are seen as positive indicators for the company’s ongoing success.
Boyd Gaming’s Q2 2024 Financial Results
In addition to Donaco’s results, Boyd Gaming has released its second quarter financial outcomes, showcasing a 5.5% increase in revenue to $967.5 million. This growth in revenue reflects positive performance and operational strength within the gaming sector.
Donaco International’s financial results for Q2 2024 demonstrate a mix of robust growth and operational challenges. While net revenue and EBITDA faced some declines compared to the previous quarter, the year-on-year improvements and increased visitation figures provide a positive outlook. The impact of the VIP win rate and the management of operating expenses are crucial factors in understanding the financial results. As the company navigates these challenges, the focus on operational stability and enhanced customer experience remains central to its strategy. The upcoming infrastructure developments, such as the new Sapa airport, are expected to support future growth and performance.