Operator News

Chile – Enjoy announces another restructuring

By James - 30 January 2024

Shares for operator Latin America’s leading casino operator Enjoy have fallen after the company announced that it was going through another restructuring. The decision was made “based on the current financial situation of the Company, the expected cash flows for the coming months, and the payment situation towards the Company’s creditors.”

Enjoy outlined a number of reasons for not reaching its growth projections including “liquidity constraints and the slow post-pandemic recovery, which had greater complexities than initially anticipated.” During the years 2020-2021, it had carried out a successful restructuring programme which had allowed it to address the problems in its operation arising from the social unrest and later the Covid-19 pandemic. This procedure ended in 2022 Enjoy said. Shares fell by as much as by as much as sixty per cent on the back of the news.

However, the company cited delays in lifting Covid related restrictions, which had gone on for longer than had initially been expected, in addition to high inflation, which had affected the company’s ability to generate a stable and consistent cash flow. This combined with a “highly restricted securities market to seek additional funds” had “led to a significant liquidity constraint for the Company, resulting in restricted investments, postponement of projects (in order to) to improve operational profitability, and maintaining a high financial burden.” This was also due to the fact that the recovery of the company’s EBITDA has not behaved in accordance with the company’s projections.

In addition Enjoy also stated that  the operation of its casino in Punta del Este had been  affected by the ability to generate “a stable and consistent cash flow,” including the effect of the UYU/USD exchange rate “which has experienced a progressive appreciation since 2021”.

Now the company will look to reach an agreement with their creditors to be able to restructure their liabilities and assets, so that it can comply with its pending commitments, continue with its businesses and recover its operational normality.

The company also announced the resignation of CEO Eliseo Gracia Martínez, from the general management of the company. He will be replaced by Esteban Rigo-Righi Baillie.