By Ian Neubauer
Shares of hotel operator National Leisure and Gaming (NLG) hit a record low of 2.6 cents per share today after the company lost just under 28 per cent of its value on Tuesday.
NLG shares were placed on a temporary trading freeze early last month after tumbling to a then-record low of 8.5 cents. Analysts attributed the fall to a 32 per cent profit downgrade for the 2007-08 financial year blamed and a botched $26.5 million rights issue.
The meltdown at NLG is closely related to developments at Hedley Leisure and Gaming (HLG), which leases 32 hotels to NLG. HLG shares were placed on a trading halt this morning after the group lost more than 28 per cent of its value as a result of short selling by investors and an internal cash flow shortage.
NLG refused comment today. But in an announcement to the Australian Stock Exchange (ASX) following the downgrading of its profit forecast last month the company cited the ongoing effects of new smoking laws on its gaming trade in NSW and Queensland as the primary cause of its financial difficulties.
NLG stock rebound marginally this morning, climbing 54 per cent to reach 4 cents per share.