Current Financials
Condensed Consolidated Income Statements
Condensed Consolidated Balance Sheet
Review Of Operations
Note:
- "Leisure and Entertainment" consists of revenue from companies involved in gaming and leisure activities.
- "Others" consists of revenue from manufacturing activities, research & development activities and inter-segment transaction.
i) Comparison with previous year's corresponding quarter
The decrease in revenue and profit before tax for Sales and Marketing ("SSM") division by 50% and 117% respectively for quarter ended 30 June 2009 compared to previous years' corresponding quarter was due to drop in number of machines sold as tabled below.
The sale of machines was affected by the continuing economic slowdown and the preference of casino operators to enter into concession programs rather than outright purchase due to budget constraint. In addition to the above sales, the Group managed to place approximately 100 machines under concessions in Macau and Philippines.
The drop in revenue and gross profit as above resulted in the drop in profit before tax as certain expenses are fixed in nature even though the gross profit margin is consistent with previous year corresponding quarter. Included in the loss before tax is impairment on assets and stock written off amounting to RM0.4 million in this quarter.
The revenue of Technical Support and Management ("TSM") division decreased by 59% for the quarter ended 30 June 2009 compared to previous years' corresponding quarter due to decrease in no of machines under concession and new concessions in Philippines and Macau not being able to generate sufficient revenue. It is the Group's target to achieve the required revenue within 9 months for new concession.
TSM division made an operating loss of RM5.3 million during the quarter mainly due to high depreciation cost on machines, provision for doubtful debts of RM1.4 million and cost of removal and relocation of 1,500 machines out of 2,000 machines under the mobilization plan to be completed by end of the year.
The decrease in revenue of the Leisure and Entertainment ("L&E") division is due to cessation of slot operation in Mekong Hotel and Club, Phnom Penh. The loss before tax of this division was contributed by:
- pre-operating costs of Chateau Hotel and Casino, Bavet, Cambodia
- fixed operating costs and impairment loss arising from closure of slot operations in clubs in Cambodia
The increase in revenue of "Others" division was mainly by sales of AGT and Elaut machines assembled in our factory in Malaysia. Stock written off amounting to RM0.8 million is included in loss before tax for this quarter.
ii) Comparison with previous year's corresponding period
The decrease in revenue and profit before tax from SSM division by 33% and 34% respectively for the six months period ended 30 June 2009 as compared to preceding year is mainly due to reasons stated above.
The summary of number of machines sold for 6 months ended 30 June 2009 and 2008 are as follows:-
The revenue from TSM division decreased by 54% for six month period ended 30 June 2009 as compare to the preceding year due to reasons stated above.
The summary of outlets in operations and the number of machines placed as at 30 June 2009 and 2008 are as follows:-
TSM division made an operating loss of RM10.6 million during the period mainly due to reasons stated above.
The decrease in revenue and loss before taxation of the L&E division is due to reasons stated above.
The revenue and profit before tax of "Others" division increase was mainly contributed by sales of RGBGames, AGT and Elaut machines assembled in our factory in Malaysia.
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