Venetian Macao Limited (VML) is terminating its gaming promotion agreement with one of Neptune Group’s major junket partner, Hou Wan Entertainment Company Ltd.
On Monday, Hou Wan received notice from VML that its gaming promotion agreement will terminate on August 30, 2017. Hou Wan currently operates 10 VIP tables in Sands Macao.
As of the year ended June 30, 2016, revenue contributed by Hou Wan to Neptune amounted to approximately HK$72.5 million (US$9.3 million), representing 26 percent of total revenue of the group. Intangible assets of Hou Wan amounted to approximately HK$160.2 million, representing 10.6 percent of total assets of the group.
Neptune says it is currently assessing the impact of the termination notice on the group.
It is expected that the intangible assets in respect of the junket business of Hou Wan would be fully impaired as a result of the termination.
As a result, Neptune says it expects to record a net loss for the year ended June 30, 2017.
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