South African Casino Operator, Tsogo Sun Gaming, announced that the adjusted earnings per share for the company are lower than expected.
The company announced it on November 21 as it sighted higher financial cost as the reason. This was a message to the investors who were expecting increased earnings per share.
This has created waves of surprises for the experts. It was expected that the earnings for the casino operator would actually surge. In a recent filing, it was found that the adjusted headline earnings per share (EPS) for the company were 68.4 cents per share. This was for the six months ending on September 30. However, it was still a sharp decline for the EPS as compared to 2018 for the same time period. The company had an EPS of 78.8 cents in 2018 for the six months ending on September 30.
Merely two weeks ago, Tsogo Sun Gaming announced that there is an increase in the cost of debt. The cost of debt increased because of the unbundling the hotel interest of the casino operator in June. This was expected to impact the EPS for the six months of time, however, back then as well.
The experts believe that the drop in the EPS was expected. However, the drop was expected by 15% or somewhere near. The adjusted headlines EPS was expected to drop but the basic EPS was expected to surge as the company also garnered R564m or $38.35m profit from the discontinued services.
The company announced that the target of the company would be to cut down the costs and improve operating efficiency now. They have to improve both at the administrative office as well as in the casino operations. The Casino Operator believes that this measure would help them to turn the financial figures in the upcoming year. In a statement, the company explained that the company would take appropriate measures and focus on the reduced capital expenditure. It further explained that the Tsogo Sun Capital wants to reduce the debt level in the coming year.
However, the company has not issued any plans neither has it issued any discussion on it. It is understood that the company wants to reduce the cost by reducing the debt level. However, the experts would urge them to explore other options as well for optimum operating efficiency and reduced cost. This is because the company is still doing well and there have been good reports for the South African Operator on many fronts.
The company has posted Rand 6 billion revenue or $406.39 reported Calvinayre. The revenue increased by 5% for the company and the management would be enthralled to see that figure. The increased revenue comes primarily from the gambling, hotel and food businesses of Tsogo Sun Gaming.
Marcel Von Aulock, the CEO of the Tsogo Sun Gaming announced a couple of weeks ago that the company is planning to build a 123 room hotel in Johannesburg. This comes after the company trimmed the expenses through a lease buyout of the Southern Sun Pretoria.