Australia-listed Silver Heritage Group has advised the market that it may likely fall short of its 2016 total revenue and adjusted EBITDA forecasts that were previously noted in its IPO prospectus.
“For the year to date, total revenue has been lower than expected at the Phoenix International Club (PIC) in Vietnam due primarily to additional gaming tables not being installed on the main gaming floor by the owners of PIC for management by SVH as anticipated,” said the operator.
“In addition the current 12 gaming tables have been experiencing a lower hold percentage (17. 9 percent for 2H16 to date vs. 19.0 percent YTD and 22.0 percent long term average),” it added.
The operator also said the increase in casinos in Kathmandu “has increased competition in that market which has resulted in a lower level of monthly revenues at The Millionaires Club & Casino, Kathmandu (TMCCK) than expected.”
With the above considered, and if PIC and TMCCK continues with its performance as observed in the last six months, total revenue and adjusted EBITDA could be 13 percent and 31 percent below forecast respectively, said the operator.
“Whilst these results are disappointing in the transition period as we complete Tiger Palace Resort Bhairahawa, we continue to constantly seek to improve footfall and performance across all of the Group’s operations. We believe that with incremental footfall driven by our overall marketing efforts in Nepal and Vietnam, and the hold percentage at PIC likely trending back towards long term historical average levels, we will see an improvement in Total Revenue and EBITDA for the Group in 2017,” it said.