Boutique Asia casino operator Donaco International posted a net loss of A$36.8 million ($26.1 million) for the six months ended Dec. 31, 2018 on Thursday, compared with a net loss of A$133.8 million a year earlier.
In a filing with the Australian Stock Exchange, the casino company blamed the net loss on impairment costs related to its Cambodian casino operations.
Donaco operates Star Vegas Resort and Club (pictured) in Poipet, Cambodia, and Aristo International Hotel, a casino hotel property in northern Vietnam, near the border with China.
In a filing on Thursday, Donaco said its net loss in the first half of fiscal 2019 included A$38.2 million in non-cash impairment from its Star Vegas casino license, which it accused of “vendor breach of contract.”
Donaco previously said damage to its Star Vegas business was a direct result of “violation of agreement.” The Australian-listed company claimed the former business partner was still running the Star Paradise casino, even though Donaco’s contract to operate Star Paradise had expired and not been renewed.
“The Board continues to pursue legal proceedings to enforce its legal rights against Thai suppliers and receive financial compensation for losses incurred,” the company said in a recent filing.
Donaco said it had received a provisional injunction that would prevent its former business partner from terminating a 50-year lease on the land where the Star Vegas casino is located, and the matter would be arbitrated in Cambodia.
“Donaco’s main legal claim is in Singapore arbitration, and the company is seeking $190 million in damages,” the company said. “The claim is scheduled to be heard in July 2019, and is supported by a freeze order obtained by Donaco on the company’s shares, which is currently extended through Oct. 4, 2019.”
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