Neptune says Venetian terminates junket accord

The Neptune Group says the Venetian Macau has terminated an accord with one of its junket operators that accounts for about 41.3 percent of group revenue. The Venetian wrote a letter to Hao Cai Sociedade Unipessoal on May 31 informing the operator of the termination. Hao Cai operates 14 VIP tables at the casino.

In a filing with the Hong Kong Stock Exchange, Neptune says as far as it is aware, two other operators representing 10 VIP tables in Sands Macau and 8 in the Grand Lisboa are operating normally.

For the year ended 30 June 2016, revenue contributed by the junket business of Hao Cai amounted to approximately HK$115.1 million ($14.7 million), while its intangible assets amounted to HK$220.9 million, representing approximately 14.6 percent of the total assets of the group.

The company is currently assessing the impact of the termination, but says on a preliminary assessment it believes that the intangible assets will be fully impaired.  The company is also assessing the recoverability of about $95.1 million of outstanding account receivables.

The shares were suspended from trading on Thursday pending news and fell more than 5 percent on resumption of trade on Friday.