Dear Fellow Shareholders
It is with great pride and immense pleasure that I present to you Delta Corp Limited'sAnnual Report for the year 2016-17.
This past year has been a distinct and memorable one for a number of reasons. Therehave been many headlines that shocked the world - from BREXIT to the election of the 45thPresident of the United States to demonetization and the introduction of Goods andServices Tax in India. But this year has also been amongst the most significant for DeltaCorp as the Company reached an inflection point in terms of both financial performanceand growth. We now stand at the cusp of a New Horizon for the Company and we expect topropel to never been seen heights....
This year an array of key developments occurred for the Company.
Deltin Caravela India's first offshore gaming casino was relaunched as aboutique luxury Hotel aimed to attract the discerning elite.
We acquired Gauss Network which owns India's leading online poker websiteAdda52.com. With this acquisition Delta Corp has made its way into online gaming - anarea of great potential - opening us up to several cross-selling opportunities with ourcasinos.
We expanded our onshore gaming foothold with the addition of a casino in Sikkimat Hotel Welcome Heritage Denzong Regency.
Our successful QIP of Rs. 5500 million has afforded us the opportunity to growexponentially and explore exciting groundbreaking business opportunities while alsomaking us debt free.
With the occurrence of demonetization there was surely some uncertainty surroundingall businesses but we at Delta Corp have found that all fears were misplaced. While stockprices reacted to the initiative in its early stages investors soon came to see that theCompany's business was not lead or dependent on cash. By the fourth quarter of FY2016 thecasinos saw a record number of patrons returning marking not only a revival ofvisitation but pushing the Company onto a higher trajectory.
Driven by these events Delta Corp delivered a remarkable financial performance for theyear with the income from total operations at Rs. 45 960.14 Lakhs compared to Rs.38215.07 Lakhs in the previous year an increase of 20%. Profit Before Tax (PBT) for theyear increased to Rs. 9781.71 Lakhs against a PBT of Rs. 5030.70 Lakhs in the previousyear a rise of 94.5%. The Net Profit for the year stood at Rs. 7087.67 Lakhs a 100.5%increase from Rs. 3533.85 Lakhs in the year prior. Earning Per Share (EPS) was Rs. 3.19as compared to Rs. 1.66 in the year before. Furthermore the Company has declared adividend of Rs. 0.35 per equity share subject to the approval of the shareholders.
It is significant to note that Delta Corp has been consistently cash flow positivesince FY2013. Now that the investment phase has passed the Company is in a position toadd to its top-line while our fixed costs remain largely constant. As a direct result ofour strong operating leverage which will continue to hold us in good stead and boostmargins we estimate an additional revenue of 100 over the breakeven point adding 65 tothe PBT level. In addition the expected launch of the casino at The Deltin Daman willfurther enhance the Company's gaming capacity bringing 1200 additional gaming positionsinto its fold.
Delta Corp is in a leading position in the market operating five of the fifteenoperational casinos in India. We dominate Goa the gaming capital of India holding threeof the six offshore gaming licenses issued by the government. After our exit from the realestate business in FY 2014 our focus is honed in on gaming as well as gaming- relatedhospitality businesses which are an integral part of the overall gaming experience. Withthat in mind we have invested in marquee hospitality assets. Currently approximately 87%of the Company's revenue comes from gaming operations while 12% is garnered fromhospitality operations.
I strongly believe that results this year demonstrate that our business has beenpropelled to the next level. With a steady income stream and the exponential developmentof the gaming market in India I have no doubt that the graph is poised for a steep upwardcurve. With strong entry barriers such as licenses and investment hurdles the gamingspace challenges new entrants. Therefore Delta Corp enjoys a competitive advantage aswell as a first mover advantage owing to the licenses already held by the Companyinvestments that we have made the expertise that we have gathered and the solidmanagement and brand that we have established.
We are also excited about our entry into the online gaming sphere which hasoutstanding potential in India and the Company's foray into this sector will open doors toa diverse clientele across a new demographic.
With this move marking our presence across multiple platforms we believe that theCompany will secure its position as a leading player in the gaming and hospitalityindustry.
The new Gaming Policy proposed by the state of Goa is also expected to bring severalpositive changes a key one being the proposed move of offshore casinos to land. Onshorecasinos are far easier to scale up as well as more stable from a business perspective.These developments will further accelerate the Company's momentum.
Delta Corp's journey continues into A New Horizon and is filled with exciting newprospects. As we march forward along this path together I thank you for your continuedtrust and faith in the Company and assure you that the best is yet to come.