My estimates on the DNA Star Vegas numbers:
$THB
Tables
VIP Turnover: 36,829m up 213% on pcp
Gross table: 1,229m up 46% on pcp
VIP Win Rate: 2.81% down 15% on pcp
Net VIP: 372m up 35% on pcp (estimate based on 1.8% junket commission rate)
Main Floor: 194.1m down 20% on pcp
Slots Gross drop: 408m down 23% on pcp
Net Slots: 133.8m down 48% on pcp*
*Interestingly, in 1H18 I worked out that the share DNA netted on gorss revenue was about 50%, if the table junket commision were indeed about 1.8%, then the slots revenue share has dropped to 33%! I suspect that RGB may take a 2/3rds cut on the first 'level' of revenue, and then to perhaps incentivise DNA to drive higher revenue, DNA takes 50% of majority on revenue milestones after this. In any event, the gross reduction in revenue combined with smaller share has decimated the slots business at this stage. Net slot revenue is down 48% on an already subdued pcp.
Costs: 454.5m up 30.5% (apparently due to higher marketing and online spend)
EBITDA: 314.7 m / USD10m
DNA Star Vegas is on a run rate of about 1/3rd of what the Vendor was achieving when he sold it. On the written down value of A231, and based on about 5.5m D+A per year, DSV is on about a ROI of about 10%.
Note: What is interesting in a highly negative way, visitation is up 30%, so then why on Earth is main floor and slot revenue down so much? The commentary refers to new marketing initiatives to target Chinese and Korean players, and talks to visitation as a achievement of this. Can we assume then that the average spend per patron has fallen dramatically, perhaps in the core Thai market the most? It's amazing that despite a 30% increase, in what would be primarily mass market players, would not even maintain mass market drop on tables and slots, in fact it was materially worse.
Note: Big positive in rebuilding the VIP business and this is now, in turnover, about 3/4s of the previous property potential.
Note: Significant work is now needed to increase the mass market yield of the property with slots and main floor tables a pale shadow of the former business.
Note: nothing reallt disclosed specifically numbers wise on the online business, yet again disappointing. I understand they don't want to set expectations, but to be investmenting in it heavily at a vulnerable time without detailed explanation seems unwarranted. What is the size of the prize? Why are we even pursuing it when the barriers to entry seem so low and it's blow up a lot of the profitability of our biggest property?
Await the lease arbitration, hopefully positive, and a refinance with Megabank.
Expand
(20min delay)