Hong Kong-listed Century Entertainment International Holdings Ltd says it is aiming to have a disclaimer of opinion issued by its auditors for the prior financial year removed for the year ending 31 March 2024, in part due to guarantees offered by its major shareholder and Chairman Ng Man Sun.
In a lengthy filing outlining its debt obligations and ability to continue as a going concern, Century Entertainment – which has been waiting to launch a table games business at a new casino in Cambodia’s Dara Sakor – Century Entertainment said it has been undertaking various measures to improve the group’s liquidity and financial position, with the validity of the going concern basis dependent on the outcome of these measures.
Despite holding a net liability position of HK$67.5 million as of 31 March 2023 due to borrowing and convertible bonds on issue, the company explained it is of the view that this would not lead to significantly adverse financial impact to the company for the year ending 31 March 2024.
This, it outlined, is because Ng has vowed not to call for repayment of HK$54.7 million in loans issued by him; that he will continue to provide further financial assistance when necessary at least until 30 June 2024; that he will provide a personal guarantee on borrowings due to independent third parties totalling HK$36.2 million; and that he may convert a convertible bond amounting to HK$50 million into equity shares.
Although an agreement in relation to the table games business, which will see the company operate and take the profits from eight gaming tables at the Dara Sakor casino, has still not taken effect, Century Entertainment said there is “no urgency for the company to repay the indebtedness currently as they are personally guaranteed by or due to Mr Ng. In addition, Mr Ng is willing to maintain his financial assistance to the Group for the purpose of working capital of the Group.”
The company added that, assuming auditors agree with its action plan to address indebtedness, including the restructuring of exterior debt with creditors, “the proposed action plans would lead to removal of disclaimer of opinion for the year ending 31 March 2024.
“The Directors believe that the Group will have sufficient working capital to support its operations upon the commencement the satisfactory operations of the gaming table business.”
