Chips are down for Tsogo Sun Gaming

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Chips are down for Tsogo Sun Gaming

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Published Date: 2020-06-10 | Source: Stephen Gunnion | Author: Stephen Gunnion

Chips are down for Tsogo Sun Gaming

The casino operator says it is faced with the uncertainty of when its casinos will be allowed to reopen and the restrictions they may face.

Tsogo Sun Gaming says it was on track to show growth for its 2020 financial year - until the middle of March when President Cyril Ramaphosa declared a national state of disaster due to Covid-19. As a result, the spread of the coronavirus and government's regulatory restrictions negatively impacted its business. All the group's casinos, which include Montecasino and Gold Reef City in Gauteng, Hemmingways in East London and The Caledon in the Western Cape, amongst others closed on 25 of March and have remained shut since. So have its Galaxy Bingo sites.

The casino operator said the lockdown reduced income growth by about 3% in the year to end-March, leaving it just 1% higher at R11.7 billion. It incurred exceptional losses of R2 billion, mostly due to impairments of intangibles due to the extended lockdown and uncertainty for the sector. Operating profit declined by 67% to R1 billion. Earnings per share (EPS) fell 87% to 19.6c while adjusted headline EPS - which exclude the impairments - came in 24% lower at 137.6c. It hasn't declared a final dividend, leaving its total dividend for the year 86% lower at 26c per share.

Tsogo said it had developed a robust strategy of enhanced hygiene and social distancing that would enable it to operate successfully once it operations were allowed to reopen.

Its shares fell 0.6% to R4.88 yesterday.





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