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France – Partouche seeks debt protection

By - 8 October 2013

French casino operator Groupe Partouche has sought creditor protection at the Tribunal de Commerce de Paris (similar to Chapter 11 bankruptcy protection) that will allow the struggling company to temporarily halt debt payment amounting to €233.7m.

The ‘safeguarding’ application will allow the company to suspend debt repayments in order to raise funds to pay creditors and avoid insolvency. Partouche is France’s number two casino operator, behind only the Barrière group (operating 49 casinos, 15 hotels, spas and golf courses), but Partouche has failed to turn a profit in each of the past five years, posting a €17.1m loss in 2012. The slide has continued into 2013, with revenue down 3.5 per cent to €328.7m in the first nine months of its fiscal year.

The company has been wrestling with it debt for the last five years, employing asset divestment plans to restructuring its debt and in the last 12 months Partouche’s debt to total capital ratio has fallen to 43.48 per cent from the previous year’s 79.69 per cent. However, in 2012 Groupe Partouche did not generate a significant amount of cash as net income fell 146.09 per cent despite relatively flat revenues.

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