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 compared to a net pr♎ofit of Rs. 42.48 Crores in Q1 June 2019.
Consolidated net sales slipped 74.08% to Rs. 48.34 Crores (Rs. 186.51 Crores in Q1 June 2019). Pre-tax l🅺oss was Rs. 34.78 Crores (pre-tax profit of Rs. 63.95 Crores in Q1 June 2019).
Like-for-like com𒀰parisons with previous quarters or years are rather pointless with the unprecedented coronavirus pandemic leading to unusual trading conditions for busine💜sses.
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 positive EBITDA (earnings before interest, taxes, depreciation and amortization).
They took zero casino reven🎉ue 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 to the gover🔥nment and other industr🧔y stakeholders during the lockdown period.
Back in June, casinos bosses in Goa called for in𒉰come tax breaks and other economic measures to help the industry.
However, De𓃲lta 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 online 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 businesse𒁃s would imply a valuation of Rs. 2,300-3,450🐈 Crores.
"This would suggest the online gaming business is worth more than the current market cap of the entire company toꩵday," DeCree said.
Shares of Delta Corp were trading at around Rs. 94 since on 15 July, ar🦩ound 5% on July 14. The shares traded hands for as much as Rs. 220 in December 2019.
