Jeju casino investor New Silkroad warns 1H loss to double

Jul 17, 2020 Newsdesk Latest News, Rest of Asia, Top of the deck  

---

New Silkroad Culturaltainment Ltd, which has a casino business within a hotel on Jeju Island, South Korea, warned in a Thursday filing that it expected to see its interim loss double, to HKD47 million (US$6.1 million), compared to a loss of HKD23 million in the prior-year period.

The firm told the Hong Kong Stock Exchange there had been a “significant drop in revenue” in the group’s “entertainment business in Jeju”.

This has been brought about “by the outbreak of the novel coronavirus pandemic since January this year, and the imposition of local travel and entry restrictions by the [South] Korea government thereby resulting in a sharp reduction of tourists to Jeju, Korea”.

The group has the MegaLuck casino operation (pictured) in the Jeju KAL Hotel on Jeju Island, and distributes wine and baijiu, a Chinese alcoholic drink.

The firm noted there had been a “decrease in gross profit margin on the group’s winery business due to slack market momentum”.

The filing added the group had “implemented cost-reduction measures to counteract the current situation,” and would “closely monitor” market developments in order to provide a “prompt response”.

In its 2019 annual report, filed on May 15 this year, New Silkroad said that a development scheme it planned on Jeju known as Glorious Hill, had “not commenced due to a delay in project financing”.

In 2017, New Silkroad announced that it had taken control of a firm called Macrolink Glorious Hill Co Ltd, putting money into it with a view to developing a big resort complex at Glorious Hill, including a “large-scale casino”.

---

---