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Cambodia – NagaCorp. generates EBITDA of US$17.7m despite four month closure

By - 31 August 2021

Despite being closed for nearly four months, Cambodia casino group NagaCorp. still managed to generate Gross Gaming Revenue (GGR) of US$129.3m at its NagaWorld casino in the capital of Phnom Penh with Adjusted EBITDA of US$17.7m and VIP Market GGR of US$80.5m.

Mass Market Tables generated GGR of US$29.9m for the six months ended 30 June 2021, reflecting the ‘impact from the voluntary temporary suspension of business operations since March 2021, in response to the COVID-19 outbreak in Cambodia.’

NagaCorp said: “The Group maintained positive EBITDA with an Adjusted EBITDA (being EBITDA less one-off cost related to the employee mutual separation scheme) of US$17.7m during the Period, despite the fact that the Group has effectively only about two months of business operations during the Period. The Group has recorded stable recovery of gaming business volume in the first quarter of 2021, prior to the 20 February 2021 COVID-19 community outbreak. Since the voluntary temporary
suspension of business operations, the Group has undertaken a series of measures to minimise run-rate operating costs and cash expenditures.”

As of 30 June 2021, the Group’s cash and deposits were US$275.4m. The Group said it has sufficient liquidity and cash reserve to fund cash expenditures during the voluntary temporary suspension of business operations.

It added: “Amid rising cases of COVID-19 infections, Cambodia is aggressively rolling out a vaccination program that will help the nation reach herd immunity. Some non-essential businesses remain closed while the Cambodian government has allowed the reopening of essential businesses, i.e. restaurants and local markets with strict social distancing and other health measures in place including requiring everyone to wear a mask, maintain social distancing, washing hands with sanitisers and scanning the “Stop COVID” QR Code before entering public venues. As of 23 August 2021, Cambodia had received about 25.1 million doses of vaccine which is sufficient to achieve the COVID-19 vaccination campaign goal of 12 million vaccinated people (75 per cent of the country’s population) by the end of 2021.

Furthermore, the vaccination drive in Phnom Penh has been completed and the city is ranked the most vaccinated capital in the world, with almost every resident vaccinated. The Cambodian government’s efforts in COVID-19 vaccination campaign are widely viewed as successful, particularly when measured by the increased vaccination up-take; this positive response to the vaccination campaign is the key to boosting market confidence.

The Group continued to focus on the execution of its existing development projects. The development of Naga 3 is in progress. It is expected that the combined complex of NagaWorld (Naga 1, Naga 2 and Naga 3) will have approximately 5,000 hotel rooms, 1,300 gaming tables and 4,500 EGM and many other non-gaming attractions. About 93 per cent of Naga 3’s gross floor area will feature non-gaming offerings, which is in line with the Group’s long term strategy of offering comprehensive lifestyle products and services. Naga 3’s long term strategy is the continuation of Naga 2’s success. The Company is committed to developing and completing the Naga 3 Project to stimulate and enhance Cambodia’s tourism industry. Given the uniqueness of a casino monopoly in the heart of a capital city, the combined complex of NagaWorld is expected to position the Group as one of the most sizable riverine integrated resorts and entertainment centres in the Asia Pacific region.

It added: “Looking ahead, 2021 will remain challenging largely resulting from economic uncertainties arising from the unprecedented COVID-19 pandemic. Nonetheless, with the relaxation of restrictions and the global economy slowly returning to normalcy, NagaWorld is expected to continue drawing tourists from South East Asia and East Asia, especially with incoming business migration inflows to Cambodia. The Group expects to continue its growth trajectory, and believes that the long term prospects and outlook of the Group will remain stable.”

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