NLG Considers Options as Talks Continue

By Andrew Starke

Listed pub operator National Leisure and Gaming (NLG) has reported a loss of over $7 million for the six months to December 27, 2009, but predicts total revenues of $187 million for the 2010 financial year – up $6 million on FY 2009.

The group operated 36 hotels over the period in question, down from 38 the year before.

Aside from divesting in hotels, NLG sought to cut costs in the half year by implementing wage reduction initiatives.

In a statement to the Australian Stock Exchange, NLG CEO and managing director, Andrew Jolliffe, confirmed that NLG was trading within all debt covenants and continued to enjoy the support of its lenders.

“NLG’s trading outlook for FY 2010 is now forecast to achieve total revenues of approximately $187 million of which consolidated gaming revenue is forecast to constitute $87.5 million,” he said.

“Given the fact that the unwinding of the Federal Government’s Dec 2008 stimulus package has had a contracting affect on consolidated revenue lines, it remains difficult to comment with certainty on the expected trading results for FY 2010.”

The NLG board is currently considering potential restructuring and strategic options to address the company’s longer term capital sustainability.

However the group said that neither these discussions nor approaches from third parties were sufficiently developed to warrant disclosure to the market.

NLG shares were trading at two cents per share at midday today, unchanged from seven days ago but significantly stronger than a year ago.