Casino equipment maker and distributor RGB International Bhd says it will not pay a final dividend for the financial year to December 31, 2019 due to the business disruption wrought by the global coronavirus crisis.
The Malaysian enterprise said in a filing to Bursa Malaysia its decision was “due to the socio-economic uncertainties arising from the ongoing Covid-19 pandemic”.
It added that the board “deliberated and determined not to declare a final dividend in respect of the financial year ending 31 December 2019, as we evaluate the full impact from the outbreak and reframe the group’s next course of action”.
The company affirmed that it had already paid in aggregate MYR4.6 million (US$1.1 million) in dividends for that financial year, “representing 12 percent of 2019 net profit”. On April 15, the firm had paid an interim single-tier dividend of MYR0.003 per ordinary share.
RGB stated: “While the group has maintained a regular dividend practice to reward loyal shareholders, the board continues to explore, over the long term, the establishment of a formal dividend policy, keeping in mind the requisite investments needed to execute our expansion plans, especially in the anticipated tough environment.”
The group added: “The priority for us is to build a sustainable growth path that will be beneficial to both the group and shareholders.”
The brand’s three main activities are: sale, marketing and manufacturing of electronic gaming machines and equipment; machine concession services, technical support and management; and on-site technical support, preventive maintenance and repair services for electronic gaming machines and equipment.
In February, RGB reported full-year 2019 net profit of nearly MYR39.8 million, up 13.1-percent on the previous year.
RGB said in its 2019 annual report filed on Friday it had “temporarily suspended its operations” on a gradual basis in its respective markets since the middle of March this year “in compliance with various restrictions implemented by the respective countries’ governments”.
It mentioned in the report that it had operations in Malaysia, Cambodia, Laos, Vietnam, Singapore, the Philippines, Macau, Timor-Leste and Nepal.
It noted that “beginning from May 2020,” the gaming industry in Vietnam had “resumed operation” and it expected “other countries to follow suit in the near future”. The Macau market has remained open during the Covid-19 crisis aside from a 15-day closure in February, but has seen a big reduction in its tourist arrivals.
RGB stated that as regional markets approach a recovery phase “in view of the requirement for social distancing measure in the respective countries, the group is exploring the possibility of remote gaming… as an alternative for land-based gaming operators”.
The firm further noted: “We are also distributing social distancing products such as machine partition and cashless payment solution for gaming outlets.”
The brand said that “despite the dampened outlook” during first-half 2020, RGB is positioning itself “to be ready for the gradual upturn once the uncertainties subside”.
Malaysia’s only casino complex, Resorts World Genting outside the capital Kuala Lumpur, remains shuttered, although its management hopes it can reopen prior to September 1, according to an analyst. Its operator Genting Malaysia Bhd said however in a notice posted on its corporate website that two of that group’s non-gaming tourism venues – Resorts World Kijal and Resorts World Langkawi – are scheduled to reopen on Thursday (June 18).