Hong Kong’s Summit Ascent Holdings says it expects to announce it returned to profit in the first six months of 2022, reversing losses endured during the same period last year despite western sanctions on Russia impacting operations at its Vladivostok casino resort, Tigre de Cristal.
Providing a financial update prior to its H1 results release next week, Summit Ascent said it anticipates a 37% increase in revenue based on its preliminary review, with Adjusted EBITDA to increase from HK$17 million for the six-month period ended 30 June 2021 to approximately HK$60 million.
Likewise, a loss of HK$8 million recorded in 1H21 will be reversed to a profit of HK$123 million on positive cash flows at Tigre de Cristal and net exchange gain of approximately HK$157 million from an “unanticipated appreciation of the Russian rubles”.
Nevertheless, Summit Ascent said it remained wary of global sanctions on Russia and the long-term impact they may have on its business operations there.
“Although the Group’s integrated resort Tigre de Cristal is operating in the Russian Far East and has been self-sustaining without any bank borrowings, the Western sanctions resulting from the Russia-Ukraine conflict may cause significant long-term damage to the Russian economy and its tourism industry,” it explained.
“The Board has been closely monitoring the market conditions, including a possible geopolitical realignment, supply disruptions and food and energy insecurity, and will continue to assess the impact on the financial position and operations of the Group.”
Summit Ascent, which counts Hong Kong-listed Suncity Group as its majority owner of Summit Ascent with a 69.66% stake, holds 77.5% of Tigre de Cristal’s operating entity, Oriental Regent Ltd.
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