Donaco International Limited, listed on the ASX, has reported a significant turnaround in its financial performance for the six months ending on 31 December 2023. The company’s group net profit surged to AU$5.7 million, a notable reversal from the AU$36.7 million loss recorded in the corresponding period a year prior. This impressive transformation can be attributed to the robust recovery of its key assets, the Star Vegas casino in Poipet, Cambodia, and Aristo International in northern Vietnam.
Recovery of Star Vegas:
Star Vegas, a flagship property of Donaco International, witnessed a remarkable recovery, emerging as a major contributor to the company’s improved financial performance. With a 44% year-on-year increase in net revenue to AU$13.4 million, coupled with an impressive 77% surge in Adjusted EBITDA to AU$8.7 million, Star Vegas demonstrated substantial growth momentum. This resurgence was fueled by the easing of COVID-19 restrictions and a surge in tourism from Cambodia, with an average daily visitation of 891 players in the first half of FY24. The positive impact of the Cambodian Government’s campaign to attract Thai visitors further bolstered Star Vegas’ performance, positioning it as a key player in Donaco’s success story.
Growth at Aristo International:
Aristo International, located in northern Vietnam, also experienced a notable turnaround, contributing significantly to Donaco’s positive financial outcomes. The property witnessed a substantial increase in net revenue from AU$630,000 in 1H23 to AU$6.1 million in the current reporting period. Moreover, Aristo achieved an Adjusted EBITDA of AU$3.5 million, effectively reversing the AU$360,000 loss recorded a year earlier. This impressive performance can be attributed to a strategic campaign aimed at attracting VIP visitors, which successfully drove increased revenue for the property. The concerted efforts to enhance operational management and capitalize on international tourism bode well for Aristo’s continued growth trajectory.
Effective Turnaround Strategy:
Donaco International’s Non-Executive Chairman, Porntat Amatavivadhana, attributes the company’s success in the first half of the year to its effective turnaround strategy. He highlights operational execution and an influx in tourism and visitations across their venues as key drivers of improved performance. The commitment to enhanced operational management resulted in increased growth, fostering a robust balance sheet for the business. The successful implementation of targeted campaigns to attract visitors, both at Star Vegas and Aristo, underscores the efficacy of Donaco’s strategic initiatives.
Outlook for Sustained Growth:
Looking ahead, Donaco remains well-positioned for sustained growth in the second half of the financial year. The company’s commitment to executing its strategy, coupled with leveraging international tourism trends, positions it to deliver solid results. With the continued momentum at Star Vegas and Aristo International, supported by ongoing initiatives to attract visitors, Donaco is poised to capitalize on emerging opportunities in the gaming and hospitality sector. The positive outlook underscores the resilience and adaptability of Donaco International in navigating challenging market conditions.
Donaco International’s impressive turnaround reflects the resilience and strategic foresight of the company in capitalizing on market opportunities. The resurgence of Star Vegas and Aristo International, driven by effective operational management and targeted campaigns, underscores Donaco’s commitment to sustained growth. With a favorable outlook for the future, fueled by ongoing efforts to attract visitors and capitalize on international tourism trends, Donaco is well-positioned to consolidate its position in the gaming and hospitality industry