S.Korea’s Paradise Co 2019 profit, Paradise City helps

Feb 26, 2020 Newsdesk Latest News, Rest of Asia, Top of the deck  

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Paradise Co Ltd, a South Korean operator of foreigner-only casinos in that country, said it swung to profit in full-year 2019, from a loss in 2018.

Such net income was KRW14.96 billion (US$12.3 million), compared to a net loss of nearly KRW21.05 billion in the prior reporting period.

The firm stated in a Wednesday filing to the Korea Exchange that the 2019 result had been positively influenced by operating profit growth due to increased casino sales at Paradise City (pictured), the gaming resort venture between Paradise Co and Japan’s Sega Sammy Holdings Inc conducted via Paradise Segasammy Co Ltd.

Paradise City produced an annual operating profit of KRW20 billion, according to a separate investor presentation lodged on Paradise Co’s corporate website.

Paradise City is at Incheon, near the main international airport serving South Korea’s capital Seoul. It opened in April 2017 with a hotel and the foreigner-only casino and has steadily added other non-gaming amenities since then.

Paradise Co recommended on Wednesday a year-end dividend for shareholders amounting in aggregate to just under KRW8.52 billion. If approved by stockholders during the company meeting due on March 27, the scheduled payment date would be April 24, for shareholders registered as of December 31.

Total 2019 sales for Paradise Co were up 24.4 percent year-on-year, at KRW979.43 billion, versus just under KRW787.62 billion in 2018.

The separate presentation to investors said 2019 casino sales were just under KRW408.31 billion, representing 41.7 percent of all group sales, and an increase year-on-year of 5.4 percent, compared to the nearly KRW387.35 billion achieved in in 2018, when such sales were 49.2 percent of the group’s total sales.

“Integrated resort” sales – a reference to Paradise City – were KRW463.17 billion in full-year 2019, accounting for 47.3 percent of all group sales, and showing a year-on-year gain of 53.6 percent. In 2018, integrated resort sales had been KRW301.60 billion, or 38.3 percent of group sales.

4Q results

In the fourth quarter, the group had a net loss of just under KRW9.66 billion, versus a KRW27.15-billion loss in fourth quarter 2018.

Group-wide sales in the fourth quarter were up 24.4 percent, at KRW269.45 billion, versus KRW216.56 billion in the final quarter of 2018.

Casino sales in the three months to December 31 were KRW110.24 billion, up 5.8 percent from the prior-year period.

Integrated resort sales rose 50.7 percent for the quarter, to KRW131.50 billion, from KRW87.25 billion a year earlier. Fourth-quarter casino sales at the integrated resort complex were nearly KRW106.58 billion, versus just under KRW71.80 billion a year earlier, an improvement of 48.4 percent.

Paradise Co runs – as well as having an interest in Paradise City – three other casino complexes. They are: Walkerhill in Seoul; Jeju Grand on Jeju Island; and Busan Casino in the southern port city of Busan.

The investor presentation lodged online on Wednesday, said Jeju Grand’s casino sales had risen 74 percent year-on-year in the fourth quarter.

The document said the group’s casino business that quarter had seen an “improving hold ratio on the back of growing [numbers of] mass customers and promotion control.”

The group also stated that in terms of fourth-quarter casino drop – the amount of cash exchanged for chips by customers at the table – what the firm termed the “Japanese VIP” segment expanded year on year, accounting for KRW515 billion of the nearly KRW1.52-trillion casino drop achieved in that period; compared to KRW475 billion of the slightly less than KRW1.52-trillion casino drop recorded in the fourth quarter 2018.

Chinese VIPs made up KRW398 billion of fourth-quarter 2019 casino drop, versus KRW450 billion in the final three months of 2018.

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