GuocoLeisure posts 23% rise in net profit on cost management

Thanks to better cost management, GuocoLeisure posted a 23 per cent rise in net profit for the 12 months ended June 30 to US$47.9 million.

"As the group's operations are predominantly in the UK, revenues were impacted by the depreciation of the Great British pound against the US dollar during the year," the group said in its financial statements.

"However, earnings were improved by lower finance costs and savings from operating expenses," it added.

Revenue for the period slipped 8 per cent to US$423.2 million due mainly to lower Bass Strait oil and gas royalty and gaming revenue. Lower average crude oil and gas prices and its production as well as the weakening Australian dollar against the greenback also affected royalty income.

Its key hotel segment posted a 46 per cent increase in profit after tax for the year to US$42.7 million, notwithstanding the impact of rooms not being available for sale due to the refurbishment. The oil and gas segment marked a 27 per cent drop in profit after tax to US$17.3 million.

The loss-making property development segment reported a loss after tax of US$2.1 million during the year, similar to the US$2.2 million after-tax loss a year ago. GuocoLeisure explained that the loss was incurred mainly due to lower business activities and no land sales during the financial year.

The gaming segment reported a decrease in revenue as a result of a significantly lower gaming win margins and drop compared to the previous financial year, resulting in a loss of US$6.1 million for the year following a US$4.6 million loss the year before.

GuocoLeisure said it managed to lower its cost of sales by 8 per cent during the year due mainly to lower gaming duty that was in line with the decrease in revenue from gaming sector as well as the weakening British pound against the US dollar. Operating and financing expenses were also pared from a year ago.