Delta Corp Slides to Q1 Net Loss of Rs. 28 Crores; Online Business Value Soars
Delta Corp has reported a consolidated loss of Rs. 28.24 Crores for Quarter One (Q1) June 2020 ওcompared to a net profit of Rs. 42.48 Crores in Q1 June 2019.
Consolidated net sales slipped 74.08% tꦿo Rs. 48.34 Crores (Rs. 186.51 Crores in Q1 June 2019). Pre-tax loss was Rs. 34.78 Crores (pre-tax profit of Rs. 63.95 Crores in Q1 June 2019).
Like-for-like comparisons with previous quarters or years are rather pointless with the unprecedented coronaviru⭕s pandemic leading to unusuaꦕl trading conditions for businesses.
The company's offline operations were forced to shut during the lockdown and remain non-operational with no date in sight for Goa casinos reopening. A Rs. 236.8 million casino license fee hit chances of Delta Corp recording a pos𒀰itive EBITDA (earnings before interest, taxes, depreciation and amortization).
They took zero𓂃 casino reve🙈nue for the quarter due to the COVID-19 shutdown, which has forced the firm to take measures to control costs.
This has included a representation to waiver licence fees t♑o the government and other industry stakeholders during the loc𓄧kdown period.
Back in June, casinos bos꧙ses in Goa called for income tax breaks and other economic measures to help the industry.
Howeve♐r, Delta Corp's online business has been boosted with more people staying at home. Delta Corp said its online gaming arm, Adda52, which operates poker and rummy gaming, reported strong revenue growth during this period.
Union Gaming analyst John DeCree forecast revenue in the company's onlꦉine segment to reach Rs. 230 Crores in sales in FY22, which based on valuations of between 10x and 15x of sales for US online gaming businesses would imply a valuation of Rs. 2,300-3,450 Cro🅘res.
"This would suggest the online gaming business is worth more t💮han the current market cap of the entire company today," DeCree said.
Shar𒁏es of Delta Corp were trading at around Rs. 94 siꦫnce on 15 July, around 5% on July 14. The shares traded hands for as much as Rs. 220 in December 2019.
