Full year results 2020

Suncity revenue down 67.4% in 2020 but investments help drive profit

| By Conor Mulheir
Integrated resort operator Suncity Group has released its financial results for the full year 2020, showing total revenue of CNY199.3m (£22.1m/€25.9m/$30.3m), down 67.4% year-on-year.

However, the operator was able to turn a net profit of CNY786.4m, up from a CNY1.48bn loss in 2019, due to gains made on the value of financial instruments and convertible bonds.

The change in value of derivative financial instruments brought in CNY1.36bn, while a change in the value of convertible bonds brought in a further CNY213.5m as a result of the extension of maturity dates of the bonds issued by the company throughout 2020.

Suncity also made a net gain of CNY200.7m on the acquisition of Summit Ascent Holdings, operator of the Tigre de Cristal casino in Russia.

These gains were partly offset by a loss of CNY415.8m on the change in value of investment properties, finance costs of CNY345.6m, loss on a joint venture of CNY246.6m and impairment loss on interest of CNY47.4m.

Net gaming revenue from the operator’s Tigre de Cristal property in Russia was approximately HK$203m (£19.0m/€22.3m/$26.1m) in 2020, down 58% year-on-year.

As Suncity only acquired Summit in October, the property’s revenue for the year was greater than SunCity’s group revenue.

Including hotel, food and beverage and other revenues, total revenue for the property was HK$211m, down from HK$533m, giving an adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) loss of HK$15m compared to positive adjusted EBITDA of HK$215m in 2019.

Net gaming revenue from the operator’s Hoiana property in Vietnam, since opening in June 2020, was US$3.5m, with a total net revenue of US$4.8m including hotel, food and beverage and other revenues. This gave an adjusted EBITDA loss of US$32.0m for the property.

The operator made further revenue of CNY37.7m from property leasing and management and the operation of malls, mainly made up of rental income from the Gang Long City Shopping Centre. This figure was down from RMB44.8m in 2019.

Hotel and integrated resort consultancy services brought in RMB7.9m, compared to RMB14.5m in 2019, while travel related products and services brought in RMB110.0m, down significantly from RMB525.5m in 2019.

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