Initial Recovery Observed as Total Revenue Increased

Tigre De Cristal Adjusted EBITDA Grew 1.3 Times Sequentially Albeit Covid

Local Mass & Slots Businesses Offered Downside Protection During Covid

HONG KONG SAR - Media OutReach - 24 August 2021 - Summit Ascent Holdings Limited ("Summit Ascent", the "Group" or "Company") (Hong Kong Stock Exchange code: 102) today reported selected unaudited financial data for the six months ended 30 June 2021. All amounts are expressed in HK$ unless otherwise stated.

INTERIM 2021 UNAUDITED RESULTS HIGHLIGHTS:

Summit Ascent: Initial Recovery Observed as Total Revenue Rose 35% YoY & 12% Sequentially

• 1H 2021 Group Total Revenue of HK$129.5 million, up 35% YoY and up 12% sequentially
• 1H 2021 Loss attributable to Owners of the Company was HK$(0.13) million, significantly improved when compared to HK$(47.0) million in 1H 2020

Tigre de Cristal: 1H 2021 Adjusted EBITDA Continued Trending Positive While Increased 1.3 Times Sequentially in the Middle of COVID, Thanks to Sustained Local Mass & Slots Businesses

• 1H Net Revenue from Gaming Operations of HK$122.7 million, up 33% YoY
• 1H Total Gross Gaming Revenue ("GGR") of HK$139.1 million, up 9% YoY
• 1H Adjusted EBITDA of Tigre de Cristal was HK$17.2 million versus negative HK$(22.1) million in 1H 2020, 1H Adjusted EBITDA was also up 131% sequentially versus 2H 2020
• Average Hotel Occupancy was 44% during weekends and 21% during weekdays in 1H 2021

Balance Sheet: Solid and Liquid Balance Sheet; Zero Gearing

• As at 30 June 2021, Bank Balances and Cash were at HK$635.3 million
• Summit Ascent granted a short-term loan of US$120 million that bears 6% interest per annum to SunTrust for yield management to generate interest income for the Group
• The Group had no outstanding Bank Borrowing throughout the first half of 2021; Gearing Ratio was 0%

Development Update: Tigre de Cristal Phase I Upgrade Ready; Phase II on its Way; Diversifying into the Philippines

• Tigre de Cristal Phase I upgrade ready – A brand-new Suncity Premium Club, new hot pot restaurant and a new private club are now ready
• Phase II planning & design on its way – Minor delays due to COVID; Continue development works with Phase II
• Diversifying into the Philippines – Invest in one of the fastest-growing Asian gaming jurisdictions in Asia, the Philippines; Receiving 6% coupon from convertible bonds and short-term loan investment in SunTrust

Mr. Chau Cheok Wa, Chairman, said:

"We are creating the good, and sustaining the bad. Summit Ascent is a blessed company with a solid cash basis and is debt-free. Suncity brought in additional flexibility to become our company's core mindset. We have a lot of bright ideas for growth; however, being able to sustain for now is the prerequisite to talk about tomorrow. Thanks to the solid local Russian demand, Tigre de Cristal continues to generate a positive-EBITDA in the first half of 2021, even surpassing that of the second half 2020 by 1.3 times. No one knows for certain how long the world will be disordered by COVID. Yet I am certain that even if the pandemic last for a while longer, Summit Ascent is well-equipped to survive the storm. Thanks to the Russian Government, our shareholders, our staff and our suppliers for your support to our company during challenging economic times."

Market Overview

Russia

In Russia, the tourism industry was significantly impacted by the resurgence of COVID-19 pandemic in the first half of 2021. Total foreign arrivals in Primorsky region in the first quarter of 2021 decreased 71 % year-on-year to 19,788¹. Borders for international tourism remained closed, and electronic visas to Russia were still suspended. Authorities extended tightened COVID-19 countermeasures, including restrictions on mass entertainment events and limiting restaurants' operating hours. Russia has launched its vaccination programme since December 2020. Mandatory vaccination was introduced in at least 18 regions in the country for high-risk groups as virus cases surged in the first half of 2021. Russia targets herd immunity by 1 November 2021.

The Philippines

In the Philippines, international tourism has not resumed yet. Manila's integrated resorts were required to temporarily suspend all operations in late March 2021 as the country entered another wave of COVID-19. Until late May 2021, the casinos resumed operations at limited capacity. The Philippines' total GGR in the first half of 2021 was PHP50.9 billion (equivalent to approximately US$1 billion), down 8% year-on-year². Foreign arrivals in January to May of 2021 decreased 97% year-on-year to 46,322 million³. The Philippines government started its COVID-19 vaccination programme in March 2021 and targets to have up to 70 million people vaccinated by 2021.

¹         Federal Security Service (FSB) 

²      Philippines Amusement and Gaming Corporation

³      Department of Trade and Industry, Republic of the Philippines

GROUP FINANCIAL RESULTS

Adjusted EBITDA of Tigre de Cristal

The Group recorded a positive Adjusted EBITDA of HK$17.2 million in the 1H 2021, versus a negative Adjusted EBITDA of HK$(22.1) million in the 1H 2020. 

Revenue and Segment Reporting

Revenue of the Group, comprising revenue from gaming operations and hotel operations, was HK$129.5 million in the 1H 2021, increased by 35% compared to HK$96.0 million in the 1H 2020.

Gaming Operations

Our Gross Gaming Revenue ("GGR"), represented the amount of money players wagered minus the winning payouts to them, before commissions rebated, discounted or complimentary products and services provided and redeemable points earned under the loyalty programs, consisted of the following:

Rolling chip business

Our rolling chip business primarily targets foreign players. The table below sets forth the key performance indicators of our rolling chip business in 2021 on a quarterly basis.

Note: Excluding the period of suspension from 28 March to 13 April and 22 April to 30 June 2020.

Due to the COVID-19 pandemic, no rolling chip activities has been noted in the 1H 2021. Rolling chip volume (measured as the sum of all non-negotiable chips wagered and lost by players) at Tigre de Cristal was HK$1.2 billion in the 1H 2020. Net win after all commissions rebated directly or indirectly to customers from rolling chip business was HK$18 million in the 1H 2020. Gross win rate percentage (represented the ratio of gross win to rolling chip volume) was 4.19% in the 1H 2020.

Mass table business

Our mass table business targets both the foreign tourists and the local market. The table below sets forth the key performance indicators of our mass table business in 2021 on a quarterly basis.

Note: Excluding the period of suspension from 28 March to 13 April and 22 April to 30 June 2020.

Mass table drop (measured as the sum of gaming chips purchased or exchanged at the cages) increased remarkably by 68% to HK$237 million in the 1H 2021, compared to HK$141 million in the 1H 2020. Net win from mass table business increased by 62% to HK$55 million in the 1H 2021, compared to HK$34 million in the 1H 2020. Net win rate percentage (represented net win as a percent of mass table drop) decreased slightly from 24.1% in the 1H 2020 to 23.2% in the 1H 2021.

Electronic gaming business

Our electronic gaming business primarily targets the local Russian market. The table below sets forth the key performance indicators in 2021 on a quarterly basis.

Note: Excluding the period of suspension from 28 March to 13 April and 22 April to 30 June 2020.

Electronic gaming volume (measured as the total value of electronic gaming credits wagered by players) was HK$1,563 million in the 1H 2021, increased significantly by 93% compared to HK$810 million in the 1H 2020. The electronic gaming business recorded net win of HK$68 million, increased by 66% compared to HK$41 million in the 1H 2020. The net win rate percentage decreased to 4.4% in the 1H 2021 from 5.1% in the 1H 2020. The average number of electronic gaming machines deployed slightly decreased by 4% to 291 units in the 1H 2021, compared to 304 units in the 1H 2020.

Hotel Operations

Revenue from hotel operations, despite largely dependent on foreign tourists, steadily increased to HK$6.7 million in the 1H 2021 or by 82% compared to the 1H 2020. Average hotel occupancy rates increased to 44% (1H 2020: 15%) during weekends and 21% (1H 2020: 20%) during weekdays in the 1H 2021.