Neptune still recovering from Venetian termination

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Local junket Neptune Group Limited has issued a profit warning noting the group would continue to record a net loss attributable for the fiscal year ended 30 June, 2017 following the termination of two junket operations associated with the group in The Venetian, the company said in a filing with the Hong Kong Stock Exchange yesterday.
The group noted that ‘it expected that the intangible assets in respect of all junket business of the group would be fully impaired’ as a result of the termination of both agreements on December 30, 2016 and May 31, 2017.
The announcement of the termination of the gaming promotion agreement with junket operator Hou Wan, effective August 30 this year, followed the termination of the agreement of the 14-VIP table operation of Hao Cai Entertainment Company Limited in the same property, effective last June 30.
The company noted in a previous filing that Hou Wan contributed ‘approximately 26 per cent of the total revenue’ of Neptune during the financial year ended June 2016.
Neptune said the loss for the year ended June 30, 2017 would decrease significantly vis-a-vis the net loss from last year, although the group would still record a reversal of impairment loss of trade receivables in an aggregate amount of approximately HK$306.3 million (US$39.22 million/MOP315.48 million).
The company further noted that the impairment of intangible assets in respect of the junket business for the fiscal year would amount to approximately HK$397.3 million rather than HK$365.9 million as stated in an announcement from July 31, while amortisation would decrease nearly 47 per cent as compared to the previous financial year.