GGRAsia – Russian casino op Summit Ascent yearly profit dips 88pct

Russian casino op Summit Ascent yearly profit dips 88pct

Mar 24, 2021 Newsdesk Latest News, Rest of Asia, Top of the deck

Hong Kong-listed Summit Ascent Holdings Ltd, the promoter of the Tigre de Cristal casino resort (pictured) in Vladivostok, Russia, says its 2020 profit fell 87.8 percent year-on-year, on gaming and hotel revenue that was down 60.4 percent.

Profit was HKD10.0 million (US$1.29 million) compared to HKD82.0 million in 2019. The 2020 revenue was HKD211.2 million versus HKD532.8 million a year earlier.

No dividend was paid or proposed during the years ended December 31 2020 and 2019, “nor has any dividend been proposed since the end of the reporting period,” stated the firm.

The decline in 2020 revenue was “primarily due to the adverse impact of the Covid-19 pandemic especially when our integrated resort… had been suspended for business from 28 March 2020 to 15 July 2020,” stated the firm in a Tuesday filing to the Hong Kong bourse.

The 2020 revenue from gaming operations was HKD202.9 million, a 57.9 percent decline from the HKD482.2 million in 2019.

Revenue from hotel operations fell 83.6 percent year-on-year in 2020, to HKD8.3 million versus the HKD50.6 million achieved a year earlier.

The group recorded negative adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) of HKD14.7 million for 2020, compared to positive adjusted EBITDA of HKD214.8 million in 2019.

Despite the negative EBITDA in 2020, Summit Ascent’s chairman Alvin Chau Cheok Wa, who is also a boss of Hong Kong-listed Suncity Group Holdings Ltd, said in commentary he was “glad to report a silver lining” for the Russian operation.

Since Tigre de Cristal’s reopening in mid-July, not only did it “manage to break even on a month-on-month basis, but it also delivered a slightly positive adjusted EBITDA in the second half of 2020, thanks to strong local demand for high-quality entertainment and hospitality services”.

The chairman also noted electronic gaming and mass table volumes had “almost returned” to pre-pandemic levels, which he suggested “confirms my belief that Summit Ascent is worth investing [in] for the long-term because Tigre de Cristal is an integrated resort well loved by both local Russians and tourists”.

In November 2020, Summit Ascent acquired additional equity interest and increased its stake in Tigre de Cristal from 60 percent to 77.5 percent, noted Tuesday’s filing.