Operator News
Chile – Enjoy calls for capital increase of US$150m in Chile
By Phil - 31 March 2020
Chilean operator Enjoy has called a shareholders’ meeting in order to approve a capital increase of US$150m due to the coronavirus crisis and the negative affect of civil unrest in Chile last year.
Enjoy reported that it had approved a calling of a shareholders’ meeting for April 24. The firm expressed that “these resources will be mainly destined to the financial strengthening of the company and the development of its business plan and future investments.”
In addition, the company released its financial statements for the fourth quarter of 2019, which reflected the recent social unrest which began on October 18. As of December 31, 2019 Enjoy presented a loss of $27,707m, higher than the loss of $25,021m registered in the 2018 fiscal year.
The general manager of the company, Rodrigo Larraín pointed out that “there are many major events that have occurred in the world and in our country in recent times and that have made us operate in a permanent contingency mode. Despite the above, we have implemented profound changes to enhance our value proposition and lay the foundations for the profitable and sustainable development of the company in the long term, given the new context of physical and digital competition, globalisation, and technological development and accelerated evolution of customers and consumers.”
Larraín added that “this call to the shareholders meeting to propose a significant capital increase seeks to cement the growth path that we have set ourselves, and that outside the contingency periods that we have lived through, it will begin to show the expected results.”
Regarding the current epidemic the company stated that “the total closure for an indeterminate period of our facilities in the three countries in which we operate given the health emergency, drastically affect our results, and therefore the work of all our collaborators, chains of companies and small to mid-size enterprise that support our operation.”
The company also stated that “financially, we have already developed a plan with various measures that are in progress to face the impacts of the closure of operations decreed by the authorities.”
Violent protests left 26 dead last year. Protests began over a price increase for subway tickets in capital Santiago but escalated quickly. A number of cities in Chile were placed under a state of emergency while protestors took to the streets. In Argentina where Enjoy operates a number of casinos a nationwide lockdown is in place which will be in effect for at least two weeks. In Chile every casino has been temporarily closed under orders from the Chilean Gaming Control Board while Uruguay recently reported its first coronavirus death, while total cases climbed above 300.
In April 2019 Enjoy announced a US$118m investment plan for the next two years which would have provided for the construction of three new hotel towers in Punta del Este, attract customers from the United States and Europe, and cover major building work for the municipal casinos in Chile. The executive said in a statement to Diario Financiero that all the financial restructuring carried out by the group was complete and they now had the financing necessary for the new projects which would be carried out over the next two years.
