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Donaco FY17 profit down on non-recurring items

Australia-listed Donaco International reported a 60.6 percent decline in net profit in FY17 compared to the prior-year, due to a number of non-recurring items.

Net-profit-after-tax for the year fell to A$31 million (US$24.7 million) in FY17, down from A$78.7 million in FY16.

Donaco said that the fiscal year saw merger and acquisition costs, working capital facility costs and a final management fee payable to its Thai partner at Star Vegas, resulting in A$24.1 million in non-recurring costs.

The previous fiscal year also saw a one-off Star Vegas valuation uplift of A$55.2 million.

Total revenue fell 4.8 percent to A$136.4 million, down from A$143.4 million in the previous fiscal year.

Donaco noted that Aristo’s EBITDA was up 40 percent to RMB 74.8 million, “as this business continues to benefit from management initiatives to increase mass market visitation, while reducing exposure to the volatile VIP segment.”

Slot machine revenue went up 62 percent to RMB14.9 million due to a strong increase in visitation to the property.

Star Vegas however, saw EBITDA go down 6 percent to THB2.1 billion, due to weaker consumer sentiment and economic conditions in Thailand. Gaming revenue at the property fell 7 percent in the period.

The operator however noted that with Star Vegas now under Donaco management control, there will be “great flexibility in marketing and gaming activities,” and that it expects visitation to improve after the mourning period (for the King of Thailand) ends in October 2017.

As a result of moving management of the casino in-house, deputy CEO Att Asvanund is stepping down from the business on August 31, 2017.

Donaco has appointed Kenny Bee as the general manager at Star Vegas.

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