GGRAsia – Asian casino operator Donaco restates US$100-mln loan

Asian casino operator Donaco restates US$100-mln loan

Mar 09, 2016 Newsdesk Latest News, Rest of Asia, Top of the deck

Southeast Asia casino operator Donaco International Ltd says that its earlier classification – for accounting purposes – of the whole of a US$100-million bank loan as a current liability was “overly conservative”.

The firm said in a filing on Tuesday to the Australian Securities Exchange: “… only some of the principal amount – not all of it – is repayable in the next 12 months”.

Donaco said that as a consequence, its board had decided formally to reissue the company’s accounts for the half-year to December 31. The reissued accounts restate the loan liability, showing that as of December 31, US$25 million of the principal was repayable within 12 months. Of that amount, US$10 million had been paid, and US$15 million was due on July 1, with a further US$15 million payable on January 1, 2017.

Donaco had said in a filing in March 2015 that it had obtained a facility of US$100 million from Taiwan’s Mega International Commercial Bank Co Ltd, commonly known as Mega Bank. Tuesday’s filing confirmed that was the loan in question.

The securing of the three-year term loan followed an announcement that Donaco was acquiring the Star Vegas Resort and Club (pictured), a casino property in Poipet, Cambodia, for a consideration price of US$360 million.

The casino operator has said that the acquisition was immediately accretive to group revenue. The firm also operates the Aristo International casino hotel in Lao Cai, in northern Vietnam.

“The loan repayment is not onerous, given the company’s strong cash flow generation. Cash flow from operations in the December 2015 half was AUD43.98 million [US$32.6 million],” noted Donaco in its Tuesday filing.

On February 24, Donaco reported casino operating revenue of AUD68.8 million for the six months to December 31, compared to AUD8.6 million in the prior-year period.