Financial Performance - The total revenue for the first half of 2020 was HKD 96,000,000, a decrease of 63% compared to the first half of 2019, primarily due to the COVID-19 pandemic and the suspension of operations at Tigre de Cristal from March 28, 2020, until July 16, 2020[15]. - The loss attributable to the owners of the company for the first half of 2020 was HKD 47,000,000, compared to a profit of HKD 42,800,000 in the first half of 2019[15]. - The group recorded a negative adjusted property EBITDA of HKD 22,100,000 for the first half of 2020, down from a positive adjusted property EBITDA of HKD 108,500,000 in the first half of 2019[15]. - The group reported a total loss attributable to owners of HKD 46,975,000 for the first half of 2020, compared to a profit of HKD 42,814,000 in the same period of 2019[57]. - The company reported a loss before tax of HKD 89,044,000 compared to a profit of HKD 55,445,000 in the previous year[114]. - Basic and diluted loss per share was HKD (2.60), compared to earnings of HKD 2.86 in the previous year[115]. - The company reported a total comprehensive loss of HKD 89,157,000 compared to a total comprehensive income of HKD 55,364,000 in the previous year[115]. Revenue Breakdown - Total revenue from gaming operations decreased to HKD 95,967,000 in the first half of 2020, down 62.7% from HKD 257,291,000 in the first half of 2019[54]. - The gaming revenue from Tigre de Cristal was HKD 92,300,000 in the first half of 2020, down from HKD 236,900,000 in the same period of 2019, representing a decline of 61%[62]. - The turnover from the remittance business was HKD 1,192,000,000 in the first half of 2020, an 86% decrease from HKD 8,360,000,000 in the first half of 2019[67]. - The net win from the remittance business fell 74% to HKD 18,000,000 in the first half of 2020, down from HKD 69,000,000 in the same period of 2019[67]. - The total betting amount for table games decreased by 60% to HKD 141,000,000 in the first half of 2020, compared to HKD 350,000,000 in the first half of 2019[70]. - The net win from table games was HKD 34,000,000 in the first half of 2020, a 56% decrease from HKD 77,000,000 in the same period of 2019[70]. - Revenue from gaming and hotel operations decreased to HKD 95,967,000, down 62.7% from HKD 257,291,000 in the previous year[114]. Operational Changes - The company suspended its gaming operations from March 28, 2020, until July 16, 2020, due to COVID-19, which adversely affected visitor numbers and revenue[131]. - The company has implemented standard operating procedures to prevent the spread of COVID-19, including temperature checks and mandatory mask-wearing[26]. - The company continues to support the Russian government's measures against COVID-19, prioritizing the health and safety of guests and employees[25]. - The group has focused on local market operations, particularly in table games and slot machines, due to ongoing border restrictions[43]. Future Developments - Future developments include a hotel expansion project with 34 new guest rooms, a new VIP gaming hall, and a new noodle shop[24]. - The second phase of the Tigre de Cristal project is expected to have a total development cost of approximately USD 200 million, with the company's estimated capital requirement being around USD 120 million (approximately HKD 930 million)[33]. - The second phase of the Tigre de Cristal project aims to double the number of gaming tables and slot machines, and increase accommodation capacity to at least double that of existing properties[33]. - The company plans to utilize the proceeds from the proposed rights issue to enhance its financial position and fund the development of the second phase of Tigre de Cristal[47]. Financial Position - As of June 30, 2020, the company maintained a healthy financial position with cash on hand of HKD 816,700,000 and no bank borrowings[15]. - The group maintained a liquidity ratio of 3.0 and a debt-to-equity ratio of zero as of June 30, 2020, showcasing strong financial resilience during the pandemic[43]. - The company did not incur any external borrowings as of June 30, 2020, maintaining a debt-to-asset ratio of 0%[90]. - The group maintained a current ratio of 3.0 as of June 30, 2020, compared to 3.2 as of December 31, 2019[91]. - Cash and cash equivalents decreased to HKD 816.7 million as of June 30, 2020, from HKD 860.7 million as of December 31, 2019[91]. Rights Issue and Capital Management - The proposed rights issue aims to raise approximately HKD 1,623,400,000 before expenses, with a subscription price of HKD 0.6 per share[27]. - The estimated net proceeds from the rights issue are approximately HKD 1,618,420,000, with about 52.3% (HKD 847 million) allocated for the subscription of convertible bonds[37]. - The estimated costs related to the rights issue, including printing, registration, legal, accounting, and documentation fees, are approximately HKD 4,980,000[37]. - The company plans to hold a special general meeting on September 7, 2020, to consider and approve matters related to a rights issue, underwriting agreement, and subscription matters[16]. Employee and Management Information - The total number of employees as of June 30, 2020, was 1,164, an increase from 1,139 as of December 31, 2019, with over 97% being local Russian citizens[104]. - The total remuneration for directors and key management personnel for the six months ended June 30, 2020, was 4,185,000 HKD, compared to 3,285,000 HKD in the same period of 2019[191]. - The company continues to provide employee benefits and training programs, including a stock option plan for directors, employees, and consultants[104]. Currency and Taxation - The company has not hedged against currency translation risks, which may significantly impact the performance and financial position due to exchange rate fluctuations[99]. - The group had unused tax losses of approximately HKD 560 million under Russian corporate tax as of June 30, 2020, compared to HKD 522.3 million as of December 31, 2019[87]. - The estimated repayment amount of input VAT to the tax authority is calculated using an effective interest rate of 8.47%[180]. Miscellaneous - The company has agreed to subscribe to convertible bonds issued by Suntrust Home Developers, Inc. with a total principal amount of 5.6 billion Philippine Pesos (approximately HKD 847 million) and an interest rate of 6%[30]. - The company has entered into a conditional subscription agreement with Suntrust Home Developers, Inc. for convertible bonds that can be converted into shares, which will be measured at fair value according to HKFRS 9[196].
凯升控股(00102) - 2020 - 中期财报