Summit Ascent Holdings Ltd, an investor in the Tigre de Cristal casino resort (pictured), at Primorye near the Russian Pacific port of Vladivostok, has said it expects to report a net loss for full-year 2023, compared with a profit of HKD11.8 million (US$1.5 million) in the prior year.
The Hong Kong-listed firm said in a Thursday filing that the expected loss was due to a number of factors, including a 1-percent year-on-year decrease in revenue from gaming and hotel operations, to approximately HKD369.1 million, “due to the fluctuation of the Russian ruble”.
The company also said it recognised an impairment loss on property, operating right, and equipment, of about HKD438.8 million for 2023, “whereas no such impairment loss was recorded for the year 2022”.
In 2023, Summit Ascent also recorded a loss related with foreign exchange rates of circa HKD39.1 million because of “fluctuation of the Russian ruble”. In the previous year, it had a gain of about HKD60.0 million, according to Thursday’s filing.
The company said the information in the filing was “only a preliminary assessment” by the firm, which had “not been audited or reviewed by the auditor or reviewed by the audit committee of the company”.
That is because the company’s audit committee is “yet to be constituted” following the resignation of, amongst others, all the firm’s independent non-executive directors on January 15.
The mass resignation followed news of a plan to sell the Tigre de Cristal operations to a Russian firm. Summit Ascent had cited “uncertainties arising from the ongoing Russia-Ukraine conflict” as a reason for the sale.
But in late February, Summit Ascent said the deal had been terminated at the request of the would-be buyer.
The same exodus took place at Summit Ascent’s parent company, Hong Kong-listed LET Group Holdings Ltd, which is currently non-compliant with the Hong Kong bourse listing rules.
On Thursday, LET Group said in its own filing that it expected its full-year 2023 loss to be lower than the HKD408.8-million loss for 2022.
The parent company said it expected the reversal of an impairment loss on “equity loans to, loans to and amounts” due from a joint venture in the amount of HKD412.5 million, as well as a share of profit of a joint venture of approximately HKD112.3 million.
LET Group also said its finance costs in 2023 had decreased by about HKD158.6 million.
